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The Q2 2015 earnings season is about to end, with the retail sector being the only big chunk left to release reports. Apart from dollar strength and energy weakness, the earnings season has so far been a decent one, with no big surprises or shocks. On an ex-energy basis, earnings from 416 companies out of 500 grew 5.3% on 1.3% on revenue growth. This would have created a new all-time quarterly record, if we could rule out energy drawbacks. However, on a general note, earnings from the S&P 500 so far have decreased 2.4% this season on an annual basis, with a beat ratio of 70.5%, while revenues declined 4.1%, with a beat ratio of 49.6%, as noted by the August 5 issue of the Zacks Earnings Trend . Estimates for the current period are being cut, but the size of negative revisions for the current period is not as stern as we saw in the prior quarters. Whatever the case, investors must be interested in finding out which sectors and their related ETFs lead or lag in the context of the Q2 earnings season. To do so, we have analyzed the sector ETF performance for the last one month, which was practically the key earnings period, and find the top ETF winners and losers from the season. Below, we profile those products . Winners PowerShares KBW Property & Casualty Insurance Portfolio ETF (NYSEARCA: KBWP ) This insurance ETF added over 5.6% in the last one month (as of August 11, 2015). The insurance sector posted earnings and revenue growth of 3.4% and 0.3%, with beat ratios of 57.9% and 52.6%. The looming Fed rate hike, sector consolidation, buybacks and dividend hikes also favor the sector and the ETF. KBWP has a Zacks ETF Rank #3 (Hold). iShares U.S. Healthcare Providers ETF (NYSEARCA: IHF ) Total earnings for 88.8% of the Medical sector were up 10.6% on 7.3% higher revenues, while 87% beat on bottom lines and 67.4% on top lines. As a result, IHF was up over 4.5% in the last one month. IHF has a Zacks ETF Rank #1 (Strong Buy). PowerShares KBW Regional Banking Portfolio ETF (NYSEARCA: KBWR ) This regional banking fund benefited greatly from nearing Fed policy normalization. The space boasts solid Zacks Ranks. In any case, U.S. banks reported solid earnings this season, with 11.6% growth in earnings on 0.6% decline in revenues. Banks recorded a 66.7% beat on earnings, with a 60% top line beat. KBWR was up 4.2% in the last one month. The fund has a Zacks ETF Rank #2 (Buy). iShares U.S. Home Construction ETF (NYSEARCA: ITB ) The housing sector has rebounded considerably this season on the construction boom. Earnings from the construction sector were up 6.7% on 2.1% higher revenues. The beat ratios on both counts were 53.8% and 30.8%, respectively. ITB has a Zacks ETF Rank #3. Columbia Select Large Cap Growth ETF (NYSEARCA: RWG ) This active large-cap growth ETF does not deal with a specific sector, but better reflects the above-average growth prospects of the overall market. As of now, Visa (NYSE: V ), Alexion Pharma (NASDAQ: ALXN ) and Nike (NYSE: NKE ) are its top three holdings, each with over 4% weight. Since the fund is active in nature, it should better capture the earnings impact as these funds actively select and remove stocks. RWG was up about 4%. Losers First Trust ISE-Revere Natural Gas Index ETF (NYSEARCA: FCG ) This product offers exposure to the U.S. stocks that derive a substantial portion of their revenues from the exploration and production of natural gas. Thanks to the weakness in energy prices, underperformance in FCG was expected from this earnings season. The fund was down 13.5% and has a Zacks ETF Rank #4 (Sell). SPDR S&P Metals and Mining ETF (NYSEARCA: XME ) The metals and mining industry has been a dreadful investing area for quite some time now, as commodities crashed on the dollar strength and reduced demand from China and other key consuming nations on growth concerns. Several of its key constituents came up with unenthusiastic results this season. The fund lost over 12% of its value in the last one month. PowerShares S&P SmallCap Energy Portfolio ETF (NASDAQ: PSCE ) This fund provides exposure to the energy sector of the U.S. small cap segment. No wonder an energy ETF, that too of smaller capitalization, will be come under extreme pressure post earnings. Given the drastic plunge in energy prices, it was more difficult for the smaller energy companies to absorb losses, as these companies lack scale advantage. As a result, PSCE was down about 9.8% in the last one month and has a Zacks ETF Rank #4. PowerShares Dynamic Semiconductors Portfolio ETF (NYSEARCA: PSI ) The semiconductor space faltered massively post earnings, as earnings declined 12%, while revenues fell 5.4%. Its fundamentals have worsened in the struggling PC market. The second quarter of 2015 witnessed PC shipments falling 9.5% year over year, marking the steepest decline since third-quarter 2013, per Gartner. Quite expectedly, investors rushed to dump the sector. The semiconductor ETF PSI thus lost about 5.8% in the last one month. The fund has a Zacks ETF Rank #3. First Trust NASDAQ-100-Tech Index ETF (NASDAQ: QTEC ) This broader tech ETF also was an underperformer post earnings. This is because the fund mainly invests in the lagging tech sub-sectors. QTEC invests over 40% in semiconductors, over 25% in software, over 14% in Internet, over 10% computer hardware and over 5% in telecom equipment. Notably, computer software services saw an earnings decline of 4.6%, telecom equipment segment endured an earnings decline of 11% and electronics division posted about 10% of negative earnings growth. QTEC was down 4.6% in the last one month. Original Post Scalper1 News
Scalper1 News