Is a Recession Coming? What 100+ Companies Are Telling Us | The Weekly Wrap
TL;DR
After analyzing earnings from over 100 companies across multiple sectors, Steve Eisman concludes that recession fears remain overblown with no imminent economic downturn visible in the data, despite specific stress in private credit, software, and airline sectors from Middle East conflict and oil price spikes.
📊 Macro Outlook: No Recession Signal Despite War Drag 3 insights
Broad earnings resilience across sectors
Over 100 companies reported mostly better-than-expected results across industrials and healthcare, indicating underlying economic stability despite geopolitical noise.
Oil price pressures hit airlines
Higher oil prices from Middle East conflict forced United Airlines to slash 2026 EPS guidance from $12-14 to $7-11, with American Airlines following suit.
Credit quality remains benign
Major banks and recent corporate earnings show benign credit data, contradicting recession predictions.
🏦 Financial Services Disruption 3 insights
Private credit market shows cracks
Blackstone's $81B BCRED fund saw flat March performance, nonaccruals rise to 1.4%, and monthly inflows plummet to $230M from a $1B average.
FICO monopoly officially ends
FHFA approved Vantage Score as an alternative to FICO for GSE mortgages, ending decades of exclusivity and driving FICO stock down 40% year-to-date.
Blackstone AUM hits record despite weak returns
Despite weak credit and real estate returns, Blackstone grew total revenue 10% and AUM to a record $1.3 trillion.
🏭 Sector Winners: Industrials & Healthcare 3 insights
Aerospace and power equipment boom
GE Aerospace orders surged 87% to $23B while GE Vernova (GEV) orders jumped 71% to $18.3B driven by AI data center electricity demand.
Health insurers show turnaround signs
UnitedHealth beat EPS expectations ($7.23 vs $6.57) with improved medical loss ratios, while Molina beat by $0.45 despite Medicaid attrition challenges.
Boeing delivery recovery continues
Boeing delivered 143 commercial aircraft, the highest since 2019, with cash outflows narrowing significantly from prior year levels.
⚠️ Sector Caution: Software & Housing 3 insights
Software narrative remains precarious
ServiceNow plunged 13% despite beating earnings due to Middle East deal delays, while IBM fell 7% on merely inline software growth.
Homebuilders face rate pressure
DHI maintained 2026 guidance despite Treasury yields hitting 4.4%, while Meritage faces 51% EPS decline but is aggressively buying back shares at below tangible book value.
Tesla's valuation disconnect persists
Tesla's EPS beat was overshadowed by plans for $25B+ capex on autonomy, highlighting the disconnect between current auto fundamentals and future robot promises.
Bottom Line
Recession fears are overblown based on Q1 earnings from 100+ companies, but investors should avoid bottom-fishing in software and watch private credit stress signals closely.
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