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Understanding Where Earnings and Revenue Growth Is Coming From

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What’s in Today’s Report:

  • Understanding Where Earnings and Revenue Growth Is Coming From
  • Visual – Money Is Moving From the Hyperscalers
  • JOLTS Data Takeaways

Futures are mildly lower as geopolitical tensions flared in the Middle East overnight with the U.S. and Iran launching a fresh wave of military strikes against one another which sent crude oil prices and global bond yields higher.

Economically, China’s May Service PMI was solid (54.4 vs. E: 52.2) while the EU Composite PMI was better than feared (48.5 vs. E: 47.5) but still in contraction territory. Paired with the latest EU PPI release, which showed a headline increase of 4.9% vs. (E) 4.5% Y/Y, the data rekindled stagflation fears in the Eurozone.

Looking ahead to today’s session, focus appears to be shifting back to the geopolitical situation in the Middle East, so any material developments (good or bad) will likely impact markets with traders keenly watching oil prices as a bellwether.

On the data front, “jobs week” kicks off with today’s ADP Employment Report (E: 120K) due out ahead of the bell, while data on Factory Orders (E: 4.3%) and the ISM Services Index (E: 53.9) will both be released shortly after the opening bell. The stronger the growth data/cooler the inflation data, the better for stocks.

Additionally there are two Fed officials scheduled to speak today: Barr (9:00 a.m. ET) and Logan (4:00 p.m. ET) and investors will be looking for a less-hawkish tone regarding potential rate hikes in 2026 in order for the risk-on rally to continue.

Finally, on the earnings front, quarterly results from MDT ($1.54), M ($0.02), AVGO ($2.02), CRWD ($0.13), AI ($-0.74), and FIVE ($1.70) are all due to be released. The semiconductor/AI-names will be particularly important as tech earnings/revenue growth has been a major market tailwind in Q2.

 

‘Tom Essaye | Corporate America is Firing on All Cylinders

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Tom Essaye Quoted in Yahoo Finance

‘Firing on all cylinders’: Wall Street strategists expect a strong quarter of earnings growth

Tom Essaye, founder of Sevens Report Research, told Yahoo Finance that “corporate America is firing on all cylinders.” He notes that S&P 500 earnings per share have climbed from roughly $235 in 2024 to projected estimates of $315 for 2026.

Whether it’s AI or other tech, the strong quarter of earnings growth has been fueled by solid margins, per Essaye. Companies are successfully navigating higher energy and transport costs without letting them dent the bottom line. Despite inflation, customer bases are “broadly good.”

“If anything, there’s upward risk, and that tells you that companies are executing well in an environment where fear is high, but the actual reality is quite good,” Essaye said.

Also, click here to view the full article published on Yahoo Finance on April 19th, 2026. However, to see the Sevens Report’s full comments on the current market environment sign up here.

If you want research that comes with no long term commitment, yet provides independent, value added, plain English analysis of complex macro topics, then begin your Sevens Report subscription today by clicking here.

To strengthen your market knowledge take a free trial of The Sevens Report.

Join hundreds of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.

Sevens Report: Tech Can Rally, but AI Dominance Is Uncertain

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Tom Essaye says software ETF IGV must stabilize before AI fears ease.

In a Broader Rally, Tech Can Still Win—But Maybe Not Dominate

Technology stocks may continue to participate in a broader market rally, but their dominance is no longer assured, according to Sevens Report President Tom Essaye.

Essaye says growing concerns that artificial intelligence could cannibalize parts of the software industry have created the most uncertain backdrop for the AI-driven bull market in three years. He points to the iShares Expanded Tech-Software Sector ETF (IGV) as a key barometer, arguing that the fund must stabilize before broader confidence in AI stocks can return.

In his view, IGV holding above last week’s low is critical. Without that technical support, skepticism surrounding AI spending, earnings sustainability, and lofty valuations could intensify. Essaye cautions investors against dismissing the recent weakness as routine volatility, noting that legitimate questions are emerging about whether expectations have outpaced reality.

That said, Sevens Report does not believe the outlook for AI and tech has turned outright negative. Major technology companies are still delivering earnings growth, but elevated expectations and aggressive capital-expenditure plans leave less room for error.

For investors seeking diversification, Essaye suggests looking beyond mega-cap tech to equal-weight, value, developed international, and low-volatility strategies. While tech can still win in a broader rally, its leadership may no longer be automatic.

Also, click here to view the full article published in Barron’s on February 12th, 2026. However, to see the Sevens Report’s full comments on the current market environment sign up here.

If you want research that comes with no long term commitment, yet provides independent, value added, plain English analysis of complex macro topics, then begin your Sevens Report subscription today by clicking here.

To strengthen your market knowledge take a free trial of The Sevens Report.

Join hundreds of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.

Tom Essaye Says Markets Trust The Rally’s Core Pillars Despite Political Noise

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Why Trump-Driven Selloffs Keep Becoming Buyable Dips

The TACO theory on Trump makes every ‘dip’ a buy, analyst says

“Trump is not going to willfully drive the markets or the economy into the ground. At least we hope not,” Tom Essaye, president and founder of Sevens Report Research, told Yahoo Finance’s Opening Bid.

The theory has become the defining feature of Trump’s current term, Essaye argues. The administration started the year laser-focused on Venezuela and has since taken aim at credit card companies over interest rates, healthcare providers over insurance costs, and even the Federal Reserve.

“The sheer volume will test the TACO theory,” Essaye said.

Despite the noise, the underlying “four pillars” of the market rally — earnings growth, stimulus, Fed support, and the AI boom — remain largely intact. Essaye suggests that while protection is “relatively cheap” and perhaps necessary for those with no hedge, the “buy the dip” mentality shouldn’t be abandoned just yet.

“One of the most important things in investing is being able to cut out the headline noise and stay focused on the big trends,” Essaye said. He points to financials and healthcare as prime examples and some of the best trades to make right now, as these sectors often sell off 3% to 5% on a single social media post, only for the threatened regulations to never materialize.

Investors should focus on earnings, underlying economic growth, and the likelihood the Fed will cut rates in the first half of the year, Essaye said. Not to mention, “AI enthusiasm is alive and well,” he added.

Ultimately, the TACO trade relies on the belief that the president’s greatest vanity is the stock market ticker. As long as that holds true, every policy-driven dip should not be viewed as a disaster, but as a tactical entry point, per Essaye.

Also, click here to view the full article published in Yahoo Finance on January 20th, 2026. However, to see the Sevens Report’s full comments on the current market environment sign up here.

If you want research that comes with no long term commitment, yet provides independent, value added, plain English analysis of complex macro topics, then begin your Sevens Report subscription today by clicking here.

To strengthen your market knowledge take a free trial of The Sevens Report.

Join hundreds of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.

Investors Are Pricing in a Soft Economic Landing – Tom Essaye Quoted in Bloomberg

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Tom Essaye says equities have room to run amid earnings growth optimism.

Stocks Close at Record, Nudged Higher as Cook Buys Nike Shares

“Investors are pricing in a soft economic landing with conviction as we approach the year-end,” said Tom Essaye, founder of the Sevens Report. He said that “equities have room to run amid optimism surrounding the potential for strong earnings growth in the quarters to come.”

Also, click here to view the full article published in Bloomberg on December 24th, 2025. However, to see the Sevens Report’s full comments on the current market environment sign up here.

If you want research that comes with no long term commitment, yet provides independent, value added, plain English analysis of complex macro topics, then begin your Sevens Report subscription today by clicking here.

To strengthen your market knowledge take a free trial of The Sevens Report.

Join hundreds of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.