Lackluster quarterly results from a few big tech names and other mega-cap stocks pulled markets down today. Still, a post-earnings drop is often seen as a buying opportunity for traders and longer-term investors alike.
While heightened market volatility can be nerve-wracking, a spike in either direction is not abnormal when companies report their earnings. That said, LendingTree TREE and Royal Caribbean Cruises RCL are two top-rated Zacks stocks that are very intriguing as their Q2 results approach on Thursday, July 25.
To that point, LendingTree and Royal Caribbean's stock appear to be poised for more upside but may be ideal buy the dip candidates on a selloff.
LendingTree’s Q2 Expectations
Traders will certainly be watching LendingTree’s earnings as its stock has continued a monstrous year-to-date rally after retaking its 50-day moving average at the beginning of the month.
The personalized loan comparison company is expected to post Q2 sales of $194.07 million, a 6% increase from the prior-year quarter. In what is a tougher-to-compete-against period, LendingTree’s Q2 EPS is projected to fall to $0.73 versus $1.14 per share a year ago.
However, the Zacks ESP (Expected Suprise Prediction) indicates LendingTree could widely surpass earnings expectations with the Most Accurate Estimate having Q2 EPS slated at $1.05 and 44% above the Zacks Consensus. Such a significant earnings beat could certainly extend the rally in TREE with it noteworthy that LendingTree has surpassed bottom line expectations for 14 consecutive quarters dating back to February of 2021.
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Royal Caribbean’s Q2 Expectations
The broader cruise industry has continued to strengthen since the pandemic and Royal Caribbean’s profitability stands out amongst other peers such as Carnival Corporation CCL and Norwegian Cruise Line NCLH.
Royal Caribbean’s Q2 sales are expected to increase 13% to $4 billion with EPS thought to have soared 52% to $2.77 compared to $1.82 a share in the comparative quarter. Plus, Royal Caribbean has exceeded earnings expectations for 9 consecutive quarters.
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Recent Performance
Topping the broader market, LendingTree’s stock has skyrocketed over +70% YTD with Royal Caribbean shares up nearly +30% to largely outperform the S&P 500’s +17%. The anticipation of high double-digit EPS growth for fiscal 2024 and FY25 has been the primary catalyst for LendingTree and Royal Caribbean’s stock.
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Bottom Line
Ahead of their Q2 reports, LendingTree’s stock boasts a Zacks Rank #1 (Strong Buy) with Royal Caribbean sporting a Zacks Rank #2 (Buy). It would be no surprise if these top-rated stocks kept rising if they could reach or exceed their quarterly expectations and offer positive guidance that reconfirms their attractive growth trajectories.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
