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The Zacks Analyst Blog Highlights Costco, Danaher, ServiceNow, AMREP and Autoscope
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For Immediate Release
Chicago, IL – July 29, 2024 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Costco Wholesale Corp. (COST - Free Report) , Danaher Corp. (DHR - Free Report) , ServiceNow, Inc. (NOW - Free Report) , AMREP Corp. (AXR - Free Report) and Autoscope Technologies Corp. (AATC - Free Report) .
Here are highlights from Friday’s Analyst Blog:
Top Stock Reports for Costco, Danaher & ServiceNow
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 Costco Wholesale Corp., Danaher Corp. and ServiceNow, Inc., as well as two micro-cap stocks AMREP Corp. and Autoscope Technologies Corp. 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.
Costco’s shares have outperformed the Zacks Retail – Discount Stores industry over the year-to-date period (+23.6% vs. +14.2%). The company being a consumer defensive stock, has been surviving the market turmoil pretty well. The discount retailer’s key strengths are strategic investments, a customer-centric approach, merchandise initiatives, and an emphasis on membership growth.
These factors have been helping it register decent sales and earnings numbers. This outlook reflects Costco’s ability to navigate the challenging operating environment, generate solid sales, and register high membership renewal rates.
A favorable product mix, steady store traffic, pricing power, and strong liquidity position should help Costco keep outperforming. While trading at a premium to its peers, its long-term growth prospects should help the stock see a solid upside.
Shares of Danaher have outperformed the Zacks Diversified Operations industry over the year-to-date period (+16.7% vs. -4.9%). The company is witnessing stable demand in the clinical and molecular diagnostics businesses which is supporting its Life Sciences segment. The segment has been witnessing positive responses toward its new products.
Danaher’s commitment to return value to shareholders is encouraging. Synergies from the Abcam acquisition bolster its growth. Through Danaher’s DBS initiatives, it has been able to reduce the impact of supply-chain constraints and inflationary pressures.
However, the company is plagued by weakness in the Life Sciences and Biotechnology units due to decreased demand across major end markets. An increase in SG&A expenses may affect the margin performance. High debt levels may raise its financial obligations and drain its profitability. Given the company’s international exposure, forex woes are weighing on its top line.
ServiceNow’s shares have outperformed the Zacks Computers - IT Services industry over the year-to-date period (+17.4% vs. +4.2%). The company has been benefiting from the rising adoption of its workflows by enterprises undergoing digital transformation.
ServiceNow had 1,988 total customers with more than $1 million in annual contract value (ACV) at the end of second quarter, which represents 15% year-over-year growth in customers. ServiceNow had 14 deals greater than $5 million in net new ACV and four deals of more than $10 million. It closed 88 deals greater than $1 million net new ACV.
Generative AI deals continued to gain traction with net new ACV for Now Assist and was part of 11 deals worth more than $1 million in the reported quarter. It is riding on an expanding partner base. Nevertheless, ServiceNow is suffering from persistent inflation, stiff competition, and a challenging macroeconomic environment.
Shares of AMREP have outperformed the Zacks Real Estate - Development industry over the past year (+27.4% vs. -6.6%). This microcap company -- with market capitalization of $115 million -- has a land portfolio in high-growth Rio Rancho, NM, covering 17,000 acres, positioning it to benefit from rising demand. In fiscal 2024, revenues grew 6%, driven by diverse streams.
The homebuilding segment grew with 36 homes sold and 64 in production in fiscal 2024. AMREP had $30.2 million in liquidity and minimal debt, supporting new projects. Property sales and adaptive strategies to market conditions enhance their portfolio management. Despite increased costs and inflation pressures, AMREP’s effective cost management and sustainable development practices maintain profitability.
Yet, challenges like declining net income, high dependency on a few homebuilders, real estate market cyclicality, regulatory risks and high competition persist. Slower land and home sales, liquidity constraints and interest rate sensitivity also pose risks.
Autoscope Technologies’ shares have outperformed the Zacks Technology Services industry over the past year (+48.8% vs. +38.3%). This microcap company with market capitalization of $36.71 million benefits from strong demand for its Autoscope Vision product, driven by North American infrastructure funding, evidenced by a 4% year-over-year increase in the first quarter of 2024 royalty revenues.
A high gross margin (96% overall, 97% for royalties) supports profitability. Shareholder returns are strong, with consistent dividends and a special $1.32-per-share payout. Strategic restructuring, including the sale of the RTMS radar line, has improved operational efficiency. Innovation continues with Autoscope IntelliSight's launch in Europe.
However, heavy reliance on Econolite royalties, reduced cash reserves, declining product sales and intensifying competition present significant risks. The company’s success depends on navigating these challenges while leveraging government funding and maintaining technological leadership.
Since 2000, our top stock-picking strategies have blown away the S&P's +7.0 average gain per year. Amazingly, they soared with average gains of +44.9%, +48.4% and +55.2% per year.
Today you can access their live picks without cost or obligation.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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The Zacks Analyst Blog Highlights Costco, Danaher, ServiceNow, AMREP and Autoscope
For Immediate Release
Chicago, IL – July 29, 2024 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Costco Wholesale Corp. (COST - Free Report) , Danaher Corp. (DHR - Free Report) , ServiceNow, Inc. (NOW - Free Report) , AMREP Corp. (AXR - Free Report) and Autoscope Technologies Corp. (AATC - Free Report) .
Here are highlights from Friday’s Analyst Blog:
Top Stock Reports for Costco, Danaher & ServiceNow
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 Costco Wholesale Corp., Danaher Corp. and ServiceNow, Inc., as well as two micro-cap stocks AMREP Corp. and Autoscope Technologies Corp. 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 >>>
Costco’s shares have outperformed the Zacks Retail – Discount Stores industry over the year-to-date period (+23.6% vs. +14.2%). The company being a consumer defensive stock, has been surviving the market turmoil pretty well. The discount retailer’s key strengths are strategic investments, a customer-centric approach, merchandise initiatives, and an emphasis on membership growth.
These factors have been helping it register decent sales and earnings numbers. This outlook reflects Costco’s ability to navigate the challenging operating environment, generate solid sales, and register high membership renewal rates.
A favorable product mix, steady store traffic, pricing power, and strong liquidity position should help Costco keep outperforming. While trading at a premium to its peers, its long-term growth prospects should help the stock see a solid upside.
(You can read the full research report on Costco here >>>)
Shares of Danaher have outperformed the Zacks Diversified Operations industry over the year-to-date period (+16.7% vs. -4.9%). The company is witnessing stable demand in the clinical and molecular diagnostics businesses which is supporting its Life Sciences segment. The segment has been witnessing positive responses toward its new products.
Danaher’s commitment to return value to shareholders is encouraging. Synergies from the Abcam acquisition bolster its growth. Through Danaher’s DBS initiatives, it has been able to reduce the impact of supply-chain constraints and inflationary pressures.
However, the company is plagued by weakness in the Life Sciences and Biotechnology units due to decreased demand across major end markets. An increase in SG&A expenses may affect the margin performance. High debt levels may raise its financial obligations and drain its profitability. Given the company’s international exposure, forex woes are weighing on its top line.
(You can read the full research report on Danaher here >>>)
ServiceNow’s shares have outperformed the Zacks Computers - IT Services industry over the year-to-date period (+17.4% vs. +4.2%). The company has been benefiting from the rising adoption of its workflows by enterprises undergoing digital transformation.
ServiceNow had 1,988 total customers with more than $1 million in annual contract value (ACV) at the end of second quarter, which represents 15% year-over-year growth in customers. ServiceNow had 14 deals greater than $5 million in net new ACV and four deals of more than $10 million. It closed 88 deals greater than $1 million net new ACV.
Generative AI deals continued to gain traction with net new ACV for Now Assist and was part of 11 deals worth more than $1 million in the reported quarter. It is riding on an expanding partner base. Nevertheless, ServiceNow is suffering from persistent inflation, stiff competition, and a challenging macroeconomic environment.
(You can read the full research report on ServiceNow here >>>)
Shares of AMREP have outperformed the Zacks Real Estate - Development industry over the past year (+27.4% vs. -6.6%). This microcap company -- with market capitalization of $115 million -- has a land portfolio in high-growth Rio Rancho, NM, covering 17,000 acres, positioning it to benefit from rising demand. In fiscal 2024, revenues grew 6%, driven by diverse streams.
The homebuilding segment grew with 36 homes sold and 64 in production in fiscal 2024. AMREP had $30.2 million in liquidity and minimal debt, supporting new projects. Property sales and adaptive strategies to market conditions enhance their portfolio management. Despite increased costs and inflation pressures, AMREP’s effective cost management and sustainable development practices maintain profitability.
Yet, challenges like declining net income, high dependency on a few homebuilders, real estate market cyclicality, regulatory risks and high competition persist. Slower land and home sales, liquidity constraints and interest rate sensitivity also pose risks.
(You can read the full research report on AMREP here >>>)
Autoscope Technologies’ shares have outperformed the Zacks Technology Services industry over the past year (+48.8% vs. +38.3%). This microcap company with market capitalization of $36.71 million benefits from strong demand for its Autoscope Vision product, driven by North American infrastructure funding, evidenced by a 4% year-over-year increase in the first quarter of 2024 royalty revenues.
A high gross margin (96% overall, 97% for royalties) supports profitability. Shareholder returns are strong, with consistent dividends and a special $1.32-per-share payout. Strategic restructuring, including the sale of the RTMS radar line, has improved operational efficiency. Innovation continues with Autoscope IntelliSight's launch in Europe.
However, heavy reliance on Econolite royalties, reduced cash reserves, declining product sales and intensifying competition present significant risks. The company’s success depends on navigating these challenges while leveraging government funding and maintaining technological leadership.
(You can read the full research report on Autoscope here >>>)
Why Haven’t You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +7.0 average gain per year. Amazingly, they soared with average gains of +44.9%, +48.4% and +55.2% per year.
Today you can access their live picks without cost or obligation.
See Stocks Free >>
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.