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Monday, March 4, 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 Broadcom Inc. (AVGO), TotalEnergies SE (TTE) and Lam Research Corp. (LRCX). 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 >>>

Broadcom’s shares have outperformed the Zacks Electronics - Semiconductors industry over the past year (+126.1% vs. +107.0%). The company is benefiting from the strong deployment of generative AI, which it expects to contribute more than 25% of semiconductor revenues in fiscal 2024.

VMware is expected to contribute $12 billion to revenues. Infrastructure software revenues are expected to be $20 billion while semiconductor solutions revenues are expected to increase in the mid to high-single-digit percentage range on a year-over-year basis in fiscal 2024.

Broadcom expects networking revenues to grow nearly 30% year over year in fiscal 2024, driven by accelerating deployment of networking connectivity and expansion of AI accelerators in hyperscalers. Wireless revenues are expected to remain stable on a year-over-year basis. However, server storage, broadband and industrial are expected to decline.

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

Shares of TotalEnergies have gained +5.5% over the past year against the Zacks Oil and Gas - Refining and Marketing industry’s gain of +7.9%. The company continues to benefit from startups, well-spread LNG assets and contribution from upstream assets located in the new hydrocarbon-producing regions.

Multi-energy assets acts as a tailwind for TotalEnergies. Acquisitions and divestitures allow the company to streamline its assets. It is steadily investing to expand its renewable operation and aims to achieve net-zero emissions by 2050.

The company’s production might be impacted by security-reasons in some regions. The company remains exposed to acquisition-related risks as these assets contribute a sizable volume to production. A natural decline in production and its withdrawal from Russia might affect profitability.

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

Lam Research’s shares have outperformed the Zacks Semiconductor Equipment - Wafer Fabrication industry over the past year (+104.7% vs. +72.3%). The company is benefiting from strength across 3D DRAM and advanced packaging technologies. Growing etch and deposition intensity owing to increasing technology inflections in 3D architectures, is a positive.

However, weakness in the systems business, primarily due to sluggish memory spending, is a major concern. Although sluggish wafer fabrication equipment spending remains a concern, improvement in the outlook for the same owing to modest memory recovery, is a positive.

For 2024, WFE spending is expected to be in the mid-high $80 billion range. NAND is expected to benefit from technology upgrades, while DRAM is likely to benefit from node conversions and capacity additions in HBM. Meanwhile, Lam Research's leading-edge investments are likely to benefit Foundry/Logic category.

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

Other noteworthy reports we are featuring today include Toyota Motor Corp. (TM), Dell Technologies Inc. (DELL) and Canadian Natural Resources Ltd. (CNQ).

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

Electric Push to Aid Toyota (TM), High R&D Expenses Ail
The Zacks analyst is optimistic about Toyota's aim to generate 40% of its global sales from EVs by 2025 and 70% by 2030. However, high research and development expenses raise concerns.

Diverse Production Mix to Aid Canadian Natural (CNQ)
The Zacks analyst thinks Canadian Natural's diverse product mix as facilitating long-term value and reducing risk profile but is worried about the company's debt maturities each year out till 2027.

Ryanair (RYAAY) Benefits From Fleet Growth, Fuel Costs High
The Zacks Analyst likes Ryanair's measures to expand its fleet to cater to the rising travel demand. However, high fuel costs are hurting Ryanair's bottom line.

Splunk (SPLK) Rides on Healthy Traction in Cloud Business
Per the Zacks analyst, Splunk is likely to benefit from the healthy traction in the cloud business as it focuses on the impending merger with Cisco for the development of next-generation AI solutions.

High Rates, Fee Income Aid State Street (STT), Expenses Ails
Per the Zacks analyst, higher rates, business servicing wins, strategic buyouts and global footprints will keep aiding State Street. Yet, rising costs and a tough operating backdrop are key headwinds.

Growing Revenues, Acquisitions Aid Tenet Healthcare (THC)
Per the Zacks analyst, Tenet Healthcare's rising top line, driven by higher adjusted admissions and surgeries, will pave the way for growth. Acquisitions enable it to expand its capabilities.

Strong Demand for Products Aids The Cooper Companies (COO)
Per the Zacks analyst, The Cooper Companies witnessed strong demand for its products across several segments during the fourth quarter. The trend is likely to continue boosting the company's prospect.

New Upgrades

Solid Demand for AI Servers Aids Dell Technologies (DELL)
Per the Zacks analyst, Dell is benefiting from strong demand for AI servers driven by ongoing digital transformation and heightened interest in generative AI applications.

CrowdStrike (CRWD) Rides on Product Strength, Acquisitions
Per the Zacks analyst, CrowdStrike is gaining from solid contributions of its growth-oriented products, primarily Falcon platform. Also, strategic buyouts like Bionic and Reposify are positive.

Solid Buyouts & U.S. Operations Bode Well for EMCOR (EME)
Per the Zacks analyst, EMCOR is benefiting from solid contributions from all its U.S. operations and accretive acquisition initiatives. Also, focus on shareholder value bodes well.

New Downgrades

Macroeconomic Headwinds to Hurt Perrigo's (PRGO) Topline
While Perrigo's (PRGO) has initiated several initiatives to lower its costs and improve margins, the Zacks Analyst is concerned since sales continue to be hurt due to macroeconomic pressures.

Aaron's (AAN) Witnesses Sluggishness in Namesake Segment
Per the Zacks analyst, Aaron's namesake unit has been witnessing a lesser lease portfolio size and lease renewal rate, coupled with fewer exercises of early purchase options and weak retail sales.

Lower Comparable Restaurant Revenues Hurt Red Robin (RRGB)
Per the Zacks Analyst, a fall in comparable restaurant revenues due to a shift away from deep discounting marketing promotions has been hurting Red Robin. High costs and debt are added concerns.

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.