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Friday, March 1, 2024

The Zacks Research Daily presents the best research output of our analyst team. Today's Research Daily features new research reports on 16 major stocks, including Apple Inc. (AAPL), Meta Platforms, Inc. (META) and Intel Corp. (INTC). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.

You can see all of today’s research reports here >>>

Apple’s shares have outperformed the Zacks Computer - Mini computers industry over the past year (+24.5% vs. +24.0%). The company is benefiting from steady iPhone sales amid stiff competition and weakness in China. It expects the March quarter’s revenues and iPhone revenues to be similar to that of the year-ago quarter’s figure after removing the additional $5 billion it generated due to pent-up demand for iPhone 14 and iPhone 14 Pro Max in the year-ago quarter.

Unfavorable forex is expected to hurt revenues by 2% on a year-over-year basis. For the Services segment, Apple expects a double-digit growth rate, similar to the December-end quarter. Strong adoption of Apple TV+ driven by strong content is a key catalyst.

Apple is gaining share in PCs which is positive. Apple’s strong cash balance and shareholder friendly approach to dividend and share repurchase is noteworthy. However, growing legal complexities has been a headwind.

(You can read the full research report on Apple here >>>)

Shares of Meta Platforms have outperformed the Zacks Internet - Software industry over the past year (+181.1% vs. +73.1%). The company is benefiting from steady user growth across all regions, particularly Asia Pacific. Increased engagement for its offerings like Instagram, WhatsApp, Messenger and Facebook has been a major growth driver.

Meta Platforms is leveraging AI to recommend Reels content, which is driving traffic on Instagram and Facebook. Its innovative portfolio, which includes Threads, Reels, Llama 2, Ray-Ban Meta smart glass, and mixed reality device Quest 3 is likely to aid prospects. Reels continued to do very well across both Instagram and Facebook driven by growing adoption.

People reshared Reels 3.5 billion times every day during the fourth-quarter. However, challenging macroeconomic conditions remain a headwind for Meta’s advertising revenues. Slow monetization of Reels, along with mounting operating losses at Reality Labs, are concerns.

(You can read the full research report on Meta Platforms here >>>)

Shares of Intel have gained +65.9% over the past year against the Zacks Semiconductor - General industry’s gain of +163.3%. The company is focusing on establishing an advanced semiconductor manufacturing ecosystem and has expanded global production capabilities under its IDM 2.0 (integrated device manufacturing) strategy.

It remains on track with its 5N4Y (five nodes in four years) program in order to regain transistor performance and power performance leadership by 2025. Intel has launched AI chips for data centers and PCs to gain a firmer footing in the expansive AI sector and ubiquitous edge environment.

However, weak demand trends and sluggish recovery in China are affecting its revenues. Macroeconomic challenges, inventory adjustments and intense market volatility are straining margins. Stiff competition in the server, storage and networking markets has hurt its long-term growth potential to some extent. For the first quarter of 2024, Intel has offered muted guidance.

(You can read the full research report on Intel here >>>)

Other noteworthy reports we are featuring today include Interactive Brokers Group, Inc. (IBKR), Diamondback Energy, Inc. (FANG) and ICON Public Limited Co. (ICLR).

Mark Vickery
Senior Editor

Note: Sheraz Mian heads the Zacks Equity Research department and is a well-regarded expert of aggregate earnings. He is frequently quoted in the print and electronic media and publishes the weekly Earnings Trends and Earnings Preview reports. If you want an email notification each time Sheraz publishes a new article, please click here>>>

Today's Must Read

Featured Reports

Electronic Focus Aid Interactive Brokers (IBKR), Costs a Woe
Per the Zacks analyst, development of proprietary software and focus on the Electronic Brokerage segment will aid Interactive Brokers. Higher costs due to technology upgrades will likely hurt profits.

Diamondback (FANG) to Benefit from Low Breakeven Costs
The Zacks analyst likes Diamondback Energy's extremely low oil price breakeven costs, wherein the company needs the commodity to be at just $50 a barrel to be profitable.

Strategic Acquisition Aid ICON (ICLR) Amid Stiff Competition
The Zacks analyst is impressed with ICON's recent acquisition of Philips Pharma Solutions which enhances ICON's medical imaging experience and capabilities. Yet, stiff rivalry remains a concern.

Cincinnati Financial (CINF) Benefits From Commercial Lines
Per the Zacks analyst, consistent progress at the Commercial Lines Insurance segment backed by solid premiums earned and several growth initiatives contributes to revenue growth of the company.

Karuna (KRTX) Banks on Lead Candidate KarXT Amid Competition
Per the Zacks analyst, the successful development and subsequent approval of KarXT will be a huge boost for Karuna as the psychosis market has immense potential. Competition remains an overhang.

Acquisitions, Diverse Customer Base Aid NRG Energy (NRG)
Per the Zacks analyst, NRG Energy's organic and inorganic acquisitions, is likely to boost its results. Its diverse customer base and retention of customers increases earnings predictability.

Maximus (MMS) Gains From Recent Acquisition Amid High Debt
Per the Zacks Analyst, the acquisition of Stirling Institute of Australia strengthens Maximus' employment services. Meanwhile, the high debt burden is concerning.

New Upgrades

Deckers' (DECK) Omni-Channel Efforts Likely to Fuel Top Line
Per the Zacks analyst, Deckers' focus on introducing more innovative line of products, marketing and optimizing omni-channel distribution are likely to propel top line.

Strategic Buyouts & Growth Plans Aid Armstrong World (AWI)
Per the Zacks analyst, Armstrong World is benefiting from accretive buyouts, strategic pricing and digital initiatives. Also, investments in new products and shareholder value bode well.

Strength in Vista & National Pen Units Drive Cimpress (CMPR)
Per the Zacks analyst, strength in Cimpress' Vista and National Pen units, fueled by robust demand for promotional products, apparel and marketing materials, will continue to lend momentum to it.

New Downgrades

Lower Headcount at Client Offices to Impact Paycom (PAYC)
Per the Zacks Analyst, Paycom's near-term results are likely to be hurt by headcount reductions across its client base due to growing recession concerns amid macroeconomic uncertainties.

Sluggish Data Center Market Hurt Advanced Energy (AEIS)
Per the Zacks Analyst, Advanced Energy is suffering from weakness in Industrial & Medical as well as Data Center computing end-markets.

Leggett & Platt (LEG) Ails From Weak Demand & Inflation
Per the Zacks analyst, Leggett & Platt hurt from soft demand, primarily in the furniture, flooring, and textile and bedding product segments along with inflationary market and normal seasonality.

Zacks Names "Single Best Pick to Double"

From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.

It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.

This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.