Wednesday, July 17, 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), Lowe's Companies, Inc. (LOW) and Shopify Inc. (SHOP), as well as two micro-cap stocks MIND Technology, Inc. (MIND) and Moving iMage Technologies, Inc. (MITQ).  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 >>>

Shares of Apple have gained +18.2% over the year-to-date period against the Zacks Computer - Mini computers industry’s gain of +22.0%. The company’s near-term prospects remain foggy due to sluggish China sales amid stiff competition. It expects the June quarter’s (third-quarter fiscal 2024) revenues to grow low-single-digit year over year. Unfavorable forex is expected to hurt revenues by 2.5%. 

Apple has been playing catch-up in the AI space compared with Alphabet, Microsoft and Amazon, its peers in the “magnificent seven” group. Following the launch of Apple Intelligence, its competitive position is expected to improve. 

Moreover, Apple is benefiting from increasing customer engagement in the services segment. The expanding content portfolio of Apple TV+ and Apple Arcade helped drive subscriber growth. Apple’s top-line benefits from strong growth in emerging markets and growing adoption of its devices among enterprises.

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

Lowe’s shares have outperformed the Zacks Building Products - Retail industry over the year-to-date period (+8.6% vs. +6.8%). The company has implemented a comprehensive Pro-focused strategy, emphasizing improved product availability, timely delivery, and an expanded assortment, complemented by a rewards program. 

Strategic growth initiatives such as store expansion and enhanced customer experiences aim to position the company as a top omnichannel retailer. Investments in service offerings, operational efficiency, and long-term drivers like sustained home improvement demand support growth and profitability. 

However, market risks, intense competition, and a decline in DIY spending present challenges for the stock. Anticipated softness in comparable sales, margin pressure, and financial strain due to high debt may hinder performance. 

(You can read the full research report on Lowe’s here >>>)

Shares of Shopify have underperformed the Zacks Internet - Services industry over the past year (-1.7% vs. +44.2%). The company is witnessing raging inflation and cautious consumer spending are headwinds.

Nevertheless, Shopify is benefiting from strong growth in its merchant base. New merchant-friendly tools like Bill Pay, Tax Platform, Collective and the Marketplace Connect app are helping it to win new merchants regularly. Strong adoption of these solutions holds promise for Shopify’s prospects. 

Integration of Shop Pay Installments into the point-of-sale terminal and general availability of Pro makes it easier for merchants to discover and engage their customers. Expansion of back-office merchant solutions to more countries is also strengthening Shopify’s international footprint. An expanding partner base that includes TikTok, Snap, Pinterest, Criteo, IBM, Cognizant, Amazon and Adyen is expected to expand its merchant base further.

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

MIND Technology’s shares have underperformed the Zacks Technology Services industry over the past year (-28.4% vs. +43.9%). This microcap company with market capitalization of $6.55 million faces challenges such as a 8.7% revenue decline in the first quarter of fiscal 2025, fluctuating backlog levels and increased capital requirement. Intense competition from established players poses significant risks.

Nevertheless, MIND Technology’s robust order pipeline and technological innovation are highlighted by a SeaLink seismic streamer system order from ATLAS ELEKTRONIK, indicating strong demand and potential long-term partnerships. The increasing focus on renewable projects, particularly offshore wind, positions MIND Technology as a critical supplier.

Strong client relationships and the potential for repeat business underscore long-term growth stability. MIND is well-positioned in the marine seismic equipment market, with a global presence that mitigates regional risks and taps into international opportunities.

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

Shares of Moving iMage Technologies have underperformed the Zacks Technology Services industry over the past year (-35.6% vs. +43.9%). This microcap company with market capitalization of $7.45 million is witnessing a supply chain disruption, competition from OTT platforms and regulatory compliance costs pose risks.

Nevertheless, Moving Image Technologies' new share repurchase program, effective until Jun 30, 2024, signals confidence in financial stability and growth. This follows a previous program where 6.3% of shares were repurchased. MiT's significant contract win with Alamo Drafthouse Cinema and expansion into high-margin SaaS and subscription-based products like MiTranslator and CineQC promise higher margins and recurring revenues. 

Diversifying into live entertainment and esports markets mitigates cinema industry cyclicality. Operating in a growing market, MiT is well-positioned to capitalize on technological advancements and increased demand for high-quality cinema experiences. Financial stability, as evidenced by $5.9 million in cash, supports growth.

(You can read the full research report on Moving iMage Technologies here >>>)

Other noteworthy reports we are featuring today include GSK plc (GSK), L3Harris Technologies, Inc. (LHX) and Markel Group Inc. (MKL).

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>>>