Tuesday, May 25, 2021
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), Goldman Sachs (GS), and Applied Materials (AMAT). 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 shares have lagged the market this year, with the stock down -4.4% this year vs. the +12.4% gain for the S&P 500 index. Driving this underperformance is the sentiment shift away from the large-cap Tech stocks and rotation into cyclical and ‘value’-oriented stocks. That said, Apple’s second-quarter fiscal 2021 results did reflect continued momentum in the Services segment, driven by a robust performance of App Store, Cloud Services, Music, advertising and AppleCare.
Moreover, iPad, Mac and Wearables contributed strongly to the quarterly results. Further, iPhone sales increased due to strong demand for iphone-12 devices. China and Japan iPhone sales increased significantly.
The Zacks analyst believes that Apple’s near-term prospects are bright, driven by new iPhones that support 5G, revamped iPad and Mac line-up of devices, health-focused Apple Watch and robust growth in the Services business. However, increasing scrutiny and legal woes over App Store is a headwind.
(You can read the full research report on Apple here >>>)
Shares of Goldman Sachs have gained +55.7% in the last six months against the Zacks Financial – Investment Bank industry’s gain of +45.4%. In fact, the company has an impressive earnings surprise history, having outpaced the Zacks Consensus Estimate in each the trailing four quarters.
The Zacks analyst believes that the company’s first-quarter 2021 results benefited from robust capital markets performance and reserve release. Goldman’s solid position in announced and completed M&As across the world will keep strengthening the business. Also, business diversification, including digital platforms, helps sustain growth. Efforts to expand consumer lending business are encouraging. Steady capital deployment activities remain a tailwind.
With a strong liquidity position, it remains less exposed to credit risk in case of any economic downturn. However, legal issues, high dependence on overseas revenues and volatile client-activity might impede top-line growth.
(You can read the full research report on Goldman Sachs here >>>)
Shares of Applied Materials have outperformed the Zacks Semiconductor Equipment – Wafer Fabrication industry in the last one-year period (+144.0% vs. +119.0%). The Zacks analyst believes that Applied Materials is driven by strong momentum across Semiconductor Systems and Applied Global Services. Further, solid demand for silicon in several applications across various markets remains a tailwind. Additionally, growing momentum among long-term service agreements is contributing well.
Furthermore, increased customer spending in foundry and logic on the back of rising need for specialty nodes in automotive, power, 5G rollout, IoT, communications and image sensor markets, is a major positive. Also, strong momentum in conductor etches is benefiting the company’s position in DRAM and NAND. However, market uncertainties continue to persist. Further, mounting expenses are concerns. Also, rising competition poses risk to the company’s market position.
(You can read the full research report on Applied Materials here >>>)
Bitcoin, Like the Internet Itself, Could Change Everything
Blockchain and cryptocurrency has sparked one of the most exciting discussion topics of a generation. Some call it the “Internet of Money” and predict it could change the way money works forever. If true, it could do to banks what Netflix did to Blockbuster and Amazon did to Sears. Experts agree we’re still in the early stages of this technology, and as it grows, it will create several investing opportunities.
Zacks’ has just revealed 3 companies that can help investors capitalize on the explosive profit potential of Bitcoin and the other cryptocurrencies with significantly less volatility than buying them directly.
See 3 crypto-related stocks now >>
Director of Research
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
Applied Materials (AMAT) Rides on Foundry & Logic Spending
Regulated Investments & Cost Mangement Aid Exelon (EXC)
Per the Zacks analyst Exelon’s cost management initiatives will have positive impact on margins and its planned $27B investments through 2024 will strengthen its operation.
Onto Innovation (ONTO) Rides on 5G Momentum Amid Competition
Per the Zacks analyst, Onto Innovation is well positioned to benefit from market strength in memory and radio frequency communications for 5G handsets along with the acceptance of new products.
Auto, Homeowners Business Aid Travelers (TRV), Cat Loss Ails
Per the Zacks analyst, consistent progress and strong market of the auto and homeowners business have driven revenues.
Strength in Glaukos’ (GKOS) iStent Product Line Aids Q1 Sales
The Zacks analyst is upbeat about Glaukos’ commercial rollout of the iStent inject W. New agreement with Santen Pharmaceutical for PRESERFLO MicroShunt buoys optimism.
Gibraltar (ROCK) Rides on Segmental Performance, Cost Hurt
Per the Zacks analyst’ robust performance of Residential, Renewable and Infrastructure segments are likely to boost Gibraltar’s margins.
Solid User Growth & Premium Content Demand Aids Snap (SNAP)
Per the Zacks analyst, Snap benefits from an improving user growth driven by strong adoption of Augmented Reality (AR) Lenses and demand for premium Discover content and Shows.
Backlog Boosts Huntington Ingalls (HII), Import Tariff Woes
Per the Zacks analyst, solid backlog count for Huntington Ingalls boosts its revenue growth prospects. Yet expansion of tariffs steel and aluminum import might push up its expenses.
Electrification & Cost Cuts to Drive American Axle (AXL)
Collaborations with Inovance and REE Automotive are likely to boost American Axle’s electrification revenues. Cost cut efforts is also aiding the firm’s near-term profits, per the Zacks analyst.
Capri Holdings’ (CPRI) Digital Endeavors to Aid Top Line
Per the Zacks analyst, deployment of resources to upgrade distribution infrastructure and e-commerce platform, and expand product offerings bode well for Capri Holdings’ sales.
Rising Loans Aid First Republic (FRC), Capital Level Solid
Per Zacks analyst, rising loan and deposit balances along with improving net interest income are likely to aid First Republic’s financials. Also, strong capital position remains a favorable factor.
Biohaven’s (BHVN) Reliance on Nurtec Burden Amid Competition
Per the Zacks analyst, Biohaven is solely dependent on successful commercialization of Nurtec for its near-term growth. However, it faces stiff competition from several large pharma companies.
Golar LNG (GLNG) Plagued By Low LNG Demand & Weak Liquidity
The Zacks analyst is concerned about Golar LNG’s soft LNG demand, which continues to be hurt by coronavirus-led woes. The company’s weak liquidity position is also worrisome.
Phillips 66 (PSXP) to be Hurt by Lower Throughput Volume
Phillips 66 Partners’ declining profits due to lower pipeline throughput volumes of crude oil concerns the Zacks analyst. Moreover, its levered balance sheet is troublesome.
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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.