A stronger-than-expected U.S. earnings season is reinforcing confidence in the broader market as investors look beyond technology stocks for opportunities. AI-driven productivity gains, resilient consumer spending and improving market breadth are supporting corporate profits even as geopolitical tensions and inflation risks remain in focus.
BNN Bloomberg spoke with Brian Szytel, Co-Chief Investment Officer at The Bahnsen Group, about the key themes emerging from earnings season, the outlook for technology stocks, dividend-growth investing strategies and why Accenture, Blackstone and McDonald’s stand out in the current market environment.
Key Takeaways
- U.S. companies broadly exceeded earnings expectations in the first quarter, supported by strong consumer demand, AI-related capital spending and favourable capital markets.
- Investors are increasingly finding opportunities outside mega-cap technology as market leadership broadens into sectors with stronger valuations and dividend yields.
- Rising energy prices tied to the Iran conflict could pressure consumer spending and contribute to inflation, potentially keeping the U.S. Federal Reserve on hold.
- Dividend-growth investors are favouring companies with strong free cash flow, durable business models and a history of returning capital to shareholders.
- AI implementation and infrastructure remain major investment themes, with companies tied to consulting, data centres and financing positioned to benefit from continued spending.
Read the full transcript below:
LINDSAY: Earnings season in the U.S. is winding down and several themes are emerging as a result of mostly better-than-expected earnings. Let’s find out what those themes are and get some ideas for your portfolio. Joining us now is Brian Szytel, co-chief investment officer at The Bahnsen Group. It’s great to have you join us. Thanks so much.
BRIAN: Great to be back with you.
LINDSAY: So we’re getting to the tail end of this earnings season. What would you say are the top narratives that have been evolving over the last couple of weeks?
BRIAN: Well, it was a great quarter across the board, more or less. You’ve got about 90 per cent of companies reporting, but 84 per cent of those have beaten, and year-over-year earnings growth is up 27 per cent, so it’s robust. Across the board, you’ve got a combination of several factors. You’ve got a strong consumer, you’ve got a strong backdrop for the economy. You’ve also got a lot of benefits from what has been a capital expenditure boom in the AI sector starting to flow through in actual revenues, and you’ve got increased productivity. Then you’ve just had favourable capital markets.
The combination of all those things, on top of record margins — call it 20 per cent now — made it a good quarter across the board.
LINDSAY: A lot of the results we saw, though, were before the conflict in Iran began. We’ve also seen inflation ticking up in the U.S. Do you think those two factors could weigh on some of these companies in the next quarter?
BRIAN: They definitely can, and those two things dovetail. The Iran conflict increased the price of energy. That flows through to CPI, of course, but it’ll also flow through to the consumer’s ability to spend on goods and services. So it’ll be interesting in Q2 to see how much that actually plays a part.
Some of the positioning we have in our portfolio is expecting there’ll be some of that on the margin. That said, I do think the starting point of how strong the economy was and how strong the consumer was gives plenty of safety margin there. But you’re right — Q1 did not include anything to do with the rise in energy prices from Iran.
LINDSAY: Yeah, it’ll be interesting to see how that factors in moving forward. We saw at the beginning of the year markets kind of broadening beyond tech, but now we’re seeing a bit of a tech resurgence. You can disagree with me if you feel that’s not right. What are your thoughts on what we’ve been seeing with tech through the first half of 2026?
BRIAN: It’s been phenomenal. Tech has delivered. There’s something to be said about what the valuation is of the sector, how much you’re paying for that delivery and how long those results can continue in a linear fashion, but there’s no question the results were phenomenal in Q1.
I suspect that’ll be an ongoing theme as the investment continues, both in companies receiving funds for building out AI and the hyperscalers, but also businesses benefiting from productivity gains. I believe that story will continue.
Again, for us as dividend-growth investors, we’re looking for businesses that can benefit but are also reasonably priced and will distribute some of those profits back to shareholders in a rising dividend income stream. In the tech landscape, that narrows the field quite a bit.
LINDSAY: So you do have some stock picks, and we’ll get to those now, starting with Accenture. Tell us a little bit more about why you’re picking this company.
BRIAN: If you think about it, Accenture is a global IT consulting business. This is a company that sells services to the Fortune 500. If you think of those companies implementing some of these AI themes and systems, they’re going to need an Accenture to do it.
The reason the stock has been halved, literally, is because there was concern AI would more or less displace the business model, and we just don’t see that as a viable outcome. I think Accenture will benefit from implementing its own AI into its business, increasing its operating leverage and benefiting its customers. Then on the demand side of the equation, I think things will work out quite well, too.
You’ve got a company that has grown the dividend for 20 years. It’s yielding 3.7 per cent. Again, it’s off 50 per cent, so it’s a good value play. We like a lot of things about Accenture.
LINDSAY: Blackstone is another company you like. You say it’s one of the most mispriced large caps in the market. Tell us more.
BRIAN: It is. Blackstone has a 3.9 per cent dividend yield at today’s entry point. It’s off roughly 40 per cent from its high back at the end of 2024. Some of that story has really just been the baby thrown out with the bath water, with concern — more media concern than actual loan-default concern — in the private credit space.
But you’ve got the largest alternative manager in the world still growing assets in Q1 by 12 per cent. Markets weren’t up 12 per cent in Q1, so that means even with private credit concerns, they’re still bringing in plenty of new capital.
You’ve got a data centre play with AI behind this story. You’ve got a very diverse, very seasoned business behind it. So we like Blackstone at this level as well. I think you get a lot of quality out of that name and a nice dividend yield.
LINDSAY: And just before we let you go, McDonald’s very quickly — why do you like this one?
BRIAN: If you think about what I said about the consumer being somewhat dented with rising gasoline prices — they’re up 40 per cent — I do think there’s a bifurcation, for lack of a better way to put it, between the haves and the have-nots. Folks are still buying premium goods, but on the lower end they’re focusing on that McValue menu.
You get a 2.7 per cent yield here. It’s off about 18 per cent from the highs. McDonald’s is a buy.
LINDSAY: Okay, we’ll leave it there. Brian Szytel, co-chief investment officer at The Bahnsen Group, really appreciate your time. Thanks for joining us.
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This BNN Bloomberg summary and transcript of the May 13, 2026 interview with Brian Szytel are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards.
