Summary
Highlights
The S&P 500 continues to reach all-time highs, with Tom Lee projecting a strong finish for 2025, potentially gaining another 10%. Despite a strong market performance and retail investors buying dips, overall investor sentiment is shaky, flickering between fear and extreme fear. This video will focus on six S&P 500 stocks that have pulled back after recent earnings reports.
Texas Instruments narrowly missed EPS and barely beat revenue, with EPS struggling year-over-year while revenue grew 14%. The stock is down 5.5% in the last 5 days and 10% year-to-date. Its forward P/E is 29.3, higher than its 5-year average of 25, suggesting potential overvaluation. The intrinsic value is calculated at $166, indicating it's near fair value, but not a strong buy currently without a margin of safety.
Elevance Health reported a 22% EPS beat and a marginal revenue beat, though EPS is down year-on-year. The stock is down over 2% recently and 7% year-to-date, underperforming the S&P over 10 years. Its forward P/E of 12.4 is below its historical 14, suggesting potential undervaluation. The intrinsic value is $462, offering a 26% margin of safety, and Wall Street sees a 17% upside.
AT&T met EPS expectations but marginally missed revenue. Its stock is down 4% over the last 5 days and has seen a significant 25% decline over the last 10 years. The forward P/E is 12, well above its 5-year average of 8, and its yield is below its historical average, indicating potential overvaluation. Despite this, a DCF intrinsic value of $30 suggests potential upside, with Wall Street projecting a 26% upside.
Lockheed Martin beat EPS by 9% and marginally beat revenue. The stock is down 3% in the last 5 days and is flat year-to-date, underperforming the S&P over 10 years. Its forward P/E and yield are similar to its 5-year average, placing it in a 'reasonable' valuation range. The intrinsic value is $485, suggesting it's trading at a fair price, with Wall Street seeing an 11% upside.
Domino's Pizza had a marginal beat on both EPS and revenue, though EPS was down 3% year-over-year. The stock is down 1% recently and flat year-to-date but has significantly outperformed the S&P over 10 years. Its forward P/E of 22 is the lowest in 5 years, and its yield is marginally higher than historical, indicating a potential undervaluation. The intrinsic value is $515, suggesting a 20% margin of safety, and Wall Street sees a 21% upside.
Netflix missed EPS by 16% but met revenue. Despite a 10% drop in the last 5 days, the stock is up 23% year-to-date and has massively outperformed the S&P over 10 years. Its forward P/E has been on a downward trend from 2018 but still sits high at around 42. The intrinsic value is $832 using a 15% growth rate, suggesting a 31% premium at current prices. Wall Street is incredibly bullish, projecting a 30% upside and seeing it as a 'buy the dip' opportunity.