Tuesday, February 18, 2025
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 The Home Depot, Inc. (HD), Booking Holdings Inc. (BKNG) and Eaton Corp. plc (ETN), as well as a micro-cap stock Value Line, Inc. (VALU). The Zacks microcap research is unique as our research content on these small and under-the-radar companies is the only research of its type in the country.
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 >>>
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You can read today's AWS here >>> Pre-Market for New Trading Week in the Green
Today's Featured Research Reports
Home Depot’s shares have outperformed the Zacks Retail - Home Furnishings industry over the past six months (+14.1% vs. +11.2%). The company’s stocks prices were driven by a recovery in top-line trends supported by sales from the SRS acquisition. Home Depot delivered better-than-expected sales and EPS in third-quarter fiscal 2024, with year-over-year sales growth fueled by gains in certain seasonal categories due to favorable weather and hurricane-related demand.
Home Depot gains from its “One Home Depot” investment plan focused on expanding supply chain facilities, enhancing technology, and improving the digital experience.
HD is also advancing efforts to build a robust Pro ecosystem. HD raised its sales and EPS view for fiscal 2024, citing strong third-quarter results and projected hurricane-related demand in Q4. However, comparable sales and EPS remain impacted by higher interest rates and ongoing macroeconomic uncertainties.
(You can read the full research report on Home Depot here >>>)
Shares of Booking have outperformed the Zacks Internet - Commerce industry over the past six months (+36.8% vs. +27.5%). The company is benefiting from a favorable travel demand environment, owing to the growing demand for global leisure travel demand. Substantial improvement in its booking trends remains a major tailwind.
Solid momentum in booked room nights is contributing well to the gross bookings growth. Strong growth in rental car and airline ticket units is a major positive. Also, strong momentum across the merchant, and advertising and other businesses are other positives. The growing alternative accommodation business and flight capabilities are tailwinds for the company.
However, the declining trend in agency bookings is negatively affecting its top-line growth. Also, geopolitical tensions in the Middle East region remained concerning for the company.
(You can read the full research report on Booking here >>>)
Eaton’s shares have outperformed the Zacks Manufacturing - Electronics industry over the past year (+12.8% vs. -2.6%). The company’s fourth-quarter earnings were better than expected. Research and development work allows the company to develop new products and cater to a wider customer base.
Eaton is aided by rising demand from the new AI-data center and contributions from its organic assets. It has been expanding via acquisitions and organic initiatives. Reindustrialization and megatrends will create more opportunities for Eaton. Our model expects total revenues to improve year over year in the 2025-2027 period.
However, Eaton’s global operations expose it to unpredictable currency translation, cyber security threats, changes in tax rates and security breaches, which might impact operations. The shortage of raw materials and supplier insolvencies might impact production and operations
(You can read the full research report on Eaton here >>>)
Shares of Value Line have underperformed the Zacks Financial - Investment Management industry over the past year (-17.9% vs. +28.3%). This microcap company with market capitalization of $323.59 million have seen drop in reputation drives demand for diversified offerings, though publishing revenues by 8.8%, signaling weaker demand. Unearned revenues fell 5.4% from April 2024, hinting at future sales challenges. Reliance on a major customer (29.2% of publishing revenue) poses a concentration risk. Cash flow declined to $4.8 million, limiting financial flexibility.
Nevertheless, Value Line offers strong shareholder returns through dividends and buybacks, increasing its dividend for 10 consecutive years, with a $1.20 annualized payout. The company repurchased shares worth $0.2 million in the latest quarter, with $1.03 million still authorized, enhancing EPS.
Cost management has been effective, cutting salaries to $3.5 million and preserving margins despite revenue pressures. Contributions from EULAV Asset Management rose to $4.2 million, providing steady cash flow. The $70.9 million investment portfolio offers liquidity.
(You can read the full research report on Value Line here >>>)
Other noteworthy reports we are featuring today include AbbVie Inc. (ABBV), The Williams Companies, Inc. (WMB) and Roku, Inc. (ROKU).
Mark Vickery
Sernior 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
Home Depot's (HD) Interconnected Strategy to Boost Sales
Booking Holdings Benefits From Strong Leisure Travel Demand
New Product Development, Wide Market Reach Aid Eaton (ETN)
Featured Reports
AbbVie's (ABBV) Skyrizi, Rinvoq Key to Top-Line Growth
The Zacks analyst says AbbVie's (ABBV) Skyrizi and Rinvoq are performing well which should support top-line growth in next few years. Slow market growth trend for Juvederm fillers is hurting sales.
Williams Companies (WMB) to Gain from Transco Expansion
The Zacks analyst believes that growing dependence on Transco pipeline due to rising demand in natural gas drives Williams Companies' earnings potential but high debt raises concern.
Cost Cuts to Aid Lincoln Electric (LECO) Amid Weak Volumes
Per the Zacks Analyst, Lincoln Electri's efforts to lower costs will help mitigate the impact of low volumes on its margins.
Woodward (WWD) Benefits from Momentum in Aerospace Segment
Per the Zacks analyst, Woodward's performance is gaining from strength in its Aerospace unit. Weak China on-highway natural gas truck business is a drag on the Industrial segment's performance
Bio-Techne's (TECH) Growth Verticals Expand Amid Fund Issues
The Zacks analyst is impressed with Bio-Techne's strong growth across its core growth verticals like Cell and Gene, and Diagnostics. Yet, a challenging funding environment in biotech is concerning.
Product Innovation Aids Mohawk (MHK) Amid Soft Demand
Per the Zacks analyst, Mohawk benefits from strategic product innovations, targeted marketing efforts and restructuring initiatives. However, soft residential demand and high costs are headwinds.
Solid Insurance in Force, Persistency Drive Radian (RDN)
Per the Zacks analyst, Radian is set to grow on solid persistency and rise in new mortgage insurance business, declining delinquency and lower claims. Yet, higher expenses weigh on margin.
New Upgrades
ROKU Rides on User Engagement & Strong Roku Channel Growth
Per the Zacks analyst, Roku is benefiting increased user engagement and ARPU. Growth of the Roku Channel in both reach and engagement is benefiting top-line growth.
Permian Basin Presence, JV Aid Plains All American (PAA)
Per the Zacks analyst, Plains All American benefits from rise in production from the Permian region, with a revival in demand for midstream services. Its joint ventures are expected to drive earnings.
Higher Rates & Repositioning Aid Commerce Bancshares (CBSH)
Per the Zacks analyst, higher for longer rates, decent loan demand, balance sheet repositioning efforts, and a solid balance sheet will likely support Commerce Bancshares' financials.
New Downgrades
Low Logistics Demand, Supply Issues Ail Avery Dennison (AVY)
Per the Zacks analyst, low demand for logistics is denting Avery Dennison's margin. Elevated costs and supply chain challenges are also concerning.
Flowers Foods (FLO) Grapples With a Tough Economic Landscape
Per Zacks analyst, Flowers Foods continues to navigate a challenging economic environment marked by shifts in consumer spending behavior. Also, soft volume in categories like cake are hurting results.
Competition and Operational Weakness Hurt Robert Half (RHI)
Per the Zacks analyst, Robert Half faces tough competition in terms of price and reliability of service. Weak operational performance is an overhang.
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See Stocks Now >>Williams Companies, Inc. (The) (WMB) : Free Stock Analysis Report
Eaton Corporation, PLC (ETN) : Free Stock Analysis Report
The Home Depot, Inc. (HD) : Free Stock Analysis Report
AbbVie Inc. (ABBV) : Free Stock Analysis Report
Roku, Inc. (ROKU) : Free Stock Analysis Report
Value Line, Inc. (VALU): Free Stock Analysis Report
Booking Holdings Inc. (BKNG) : Free Stock Analysis Report
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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.
