S&P 500: 7 Companies Just Wowed Investors With Huge Profit Surprises

In a market filled with doom and gloom, finding positive surprises in the S&P 500 is all the sweeter. And there’s plenty of them.

Seven companies in the S&P 500, including communication firm T-Mobile US (TMUS), real estate play American Tower (AMT) and industrial General Electric (GE), just reported second-quarter profit that topped estimates by more than 40%, says an Investor’s Business Daily analysis of data from S&P Global Market Intelligence and MarketSmith.

That’s an astounding surprise that’s much needed when S&P 500 investors are preoccupied with recession, inflation and global tensions.

“U.S. stocks rallied after a steady dose of impressive earnings and economic data,” said Edward Moya, strategist at Oanda. “The economy doesn’t look bad at all after strong earnings.”

Low Expectations For S&P 500 Profit

More than 350 companies in the S&P 500 have reported their results for the second-quarter so far. And so far, they’re not as bad as most investors feared coming into earnings season.

Second-quarter earnings growth for the S&P 500 is coming in at roughly 6%, says John Butters of FactSet. That’s on track to be the S&P 500’s lowest profit growth since it grew by 4% in the fourth quarter of 2020.

But it’s all about the surprises. Nearly three-quarters of S&P 500 companies to report profit earned more than expected, Butters says. That’s below the 77% of companies that usually do. And for most S&P 500 companies, the surprises are smaller than usual. Additionally, they’re only beating by 3.1%. That falls short of the 8.8% typical surprise.

Still, there have been some massive surprises.

T-Mobile US Dials Up Giant Surprise

If you’re looking for an S&P 500 that’s doing much better than anyone saw coming, it’s T-Mobile US. The telecom carrier’s second-quarter profit came in 424% higher than expected.

In some ways, the fact T-Mobile US’ profit surprised on the upside is more of the rule than the exception. The company’s profit topped bottom-line estimates in every quarter since 2015. But it’s the magnitude of the beat in the second quarter that’s unusual.

The company’s quarterly profit of $1.94 a share absolutely smashed the estimate calling for a profit of 37 cents a share. And it’s not completely missed by investors. Shares of T-Mobile are up 7% in the first few days of August. And they’re up more than 24% this year.

Other Big Profit Surprises

T-Mobile is the master of positive surprises. But it’s not alone, at least in the second quarter.

Cellphone tower rental company American Tower, which hosts some of T-Mobile’s wireless bandwidth, is another big winner. The company reported a second-quarter profit of $1.95 a share in the second quarter. That topped views by 103%. Investors got in slightly ahead of the report, driving the stock up 5.2% since July.

And another surprising surprise came from struggling industrial firm GE. Despite the company’s travails all year, leading to a 20% drop for the stock this year, the company’s second-quarter profit of 78 cents a shares topped views by nearly 86%. And that’s been a boost the stock needed. Shares are up nearly 18% since July.

So while it’s true S&P 500 investors have lots to worry about, there’s good news, too.

Biggest S&P 500 Profit Surprises

All topped in the second quarter

Company Name	Ticker	Earnings per share Q2 surprise	Sector
T-Mobile US	(TMUS)	424.3%	Communication Services
American Tower	(AMT)	103.1	Real Estate
General Electric	(GE)	85.7	Industrials
Kimco Realty	(KIM)	60	Real Estate
Ford Motor	(F)	51.1	Consumer Discretionary
Electronic Arts	(EA)	46.4	Communication Services
The Hartford Financial Services Group	(HIG)	41.4	Financials