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Investors should always pay attention to earnings because they are the fundamental driver of long-term stock value, revealing a company's profitability, efficiency, and financial health, directly impacting stock prices through growth, dividends, or buybacks, and signaling future potential and overall market trends.
It’s also important to pay close attention to guidance.
Look at Apple for example.
Apple is running ahead of earnings on Thursday, after JPMorgan boosted its price target on stronger iPhone demand.
In fact, the firm reiterated its overweight rating on Apple and raised its price target to $315 from $305 ahead of Apple’s first-quarter earnings report on Thursday.
“We see a positive set up for the shares heading into F1Q26 (Dec-end) earnings print as AAPL shares are trading at 30x NTM P/E, below the peak multiple that is typical for the shares heading into a key iPhone product cycle (previous peak of ~32x into 5G cycle), in combination with the modest upsides in relation to both F1Q26 print and the F2Q26 outlook,” added the firm, as quoted by CNBC.
Other analysts agree.
Evercore ISI added Apple to its Tactical Outperform list, arguing that strong iPhone demand positions the company for strong earnings. The firm reiterated an Outperform rating and a $330 price target on Apple stock. Evercore expects iPhone revenue to climb 17% year over year, which would be well above calls for 11% growth.
Analysts at Citi say that the surge in demand for iPhone 17 models carried through the end of the year. The firm expects to see Apple beat earnings, thanks to the sale of 82 million iPhone units, which was ahead of consensus estimates.
Meta Platforms
Meta Platforms has been rocketing higher heading into earnings on Thursday.
Analysts expect Meta to generate earnings of $8.29 per share, an increase of 3.4% from $8.02 per share reported year over year. For the current year, analysts forecast the company to report an EPS of $29.40, a 23.2% increase from $23.86 reported for FY 2024. EPS is expected to grow 4.2% year over year to $30.63 in fiscal 2026.
With this report, we’re looking for growth in its investments in data centers and hardware. That’s in addition to what its spending on R&D, which jumped about 50% over the last few years, as the company aggressively invests in artificial intelligence.
Helping, analysts at Bank of America just reiterated a buy rating on the stock with an $810 price target. The firm expects fourth-quarter revenue of $59.2 billion and earnings per share of $8.27, above consensus estimates of $58.3 billion and $8.20, respectively.
For the first quarter of 2026, the firm expects revenue of $52.3 billion and EPS of $6.31, compared to Street expectations of $51.2 billion and $6.29. The firm anticipates Meta will guide first-quarter revenue between $50 to $52.5 billion, representing 18 to 24% year-over-year growth.
PayPal
PayPal reports Q4 2025 earnings on February 3rd. After four consecutive quarters of beating estimates, the company continues to attract attention. This time around, the company is expected to post EPS of between $1.29 and $1.34 on sales of about $8.76 billion, which would show modest year over year growth.
For full-fiscal year 2025, the company is expected to post EPS of $5.36, up about 15% year over year. For fiscal 2026, EPS is expected to jump 9.3% year over year to $5.86.
Granted, there are concerns about slowing growth and competitive pressure.
In fact, in the last reported quarter, active accounts grew only about 1% year-over-year, while total payment transactions declined 5%. Plus, there were signs that users weren’t transacting as often. Moving forward, if PYPL can show that those numbers are turning around, the better.
In short…
Apple appears well positioned heading into its earnings release, supported by strong iPhone demand and rising analyst confidence. Meta Platforms also enters its report with solid expectations, fueled by continued advertising strength and aggressive investments in artificial intelligence. Meanwhile, PayPal faces a more mixed outlook, with earnings growth expected but lingering concerns around user engagement and transaction volumes.
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Written by Ian Cooper