The stock jumped after the company reported June-quarter earnings of $1.78 per share, well ahead of the $1.11 analysts were expecting for the period.
"The key takeaway in the quarterly results was operating leverage, as Amazon's overall operating margin widened to 6.9% from 4.6% in the year-ago quarter and 5.7% in the March quarter. The combination of top-line growth and margin expansion resulted not only in strong EPS generation relative to expectations, but robust year-over-year growth in both operating cash flow and free cash flow, which Amazon is using to fund growth initiatives," Hawkins and Versace wrote.
"Margin expansion reflected strong progress at North American Retail and Amazon Web Services, offset by International Retail as continued losses at that business remained a margin drag during the June quarter. Despite that, Amazon reported its fifth straight profitable quarter, which, in our view, should quell the naysayers that have periodically banged the "Amazon doesn't earn a profit" drum."
Meanwhile Action Alerts PLUS holding Alphabet (GOOGL) also had a strong quarter, reporting EPS of $8.42, also well ahead of Wall Street's $8.03 consensus. Revenue for the period was $21.5 billion, topping analyst expectations by about $750 million.
"Digging deeper into the results, free cash flow rose to nearly $7 billion, up from $4.5 billion in 2Q15, highlighting the company's incredible optionality and operating leverage embedded within this company's business model, not to mention the cost discipline CFO Ruth Porat has instilled since joining the company," AAP co-managers Jim Cramer and Jack Mohr wrote in a recent note. "This was a fantastic quarter, with core Google's dominance and Ruth Porat's capex discipline on full display. There had been some concerns from sell-side in the weeks leading up to the quarter regarding potential share loss or impacts from Brexit, but the company flexed its muscles and showed its resilience."
Kohl's is scheduled to announce its results for the fiscal second quarter (ended July) on Aug. 11, and Peltier plans to pay the most attention to more details on the distribution deal the retailer recently signed with sports apparel manufacturer and Growth Seeker holding Under Armour (UA) . Analysts on average are expecting the company to report EPS of $1.03 on revenue of $4.16 billion.
Pfizer is expected to report second-quarter EPS of $0.62, a $0.06 increase over the previous year's quarter.