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The Zacks Analyst Blog Highlights HSBC, Barclays, Plains All American Pipeline, Chewy and FTAI Aviation
Read MoreHide Full Article
For Immediate Release
Chicago, IL – July 30, 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: HSBC (HSBC - Free Report) , Barclays (BCS - Free Report) , Plains All American Pipeline (PAA - Free Report) , Chewy (CHWY - Free Report) and FTAI Aviation Ltd. (FTAI - Free Report) .
Here are highlights from Monday’s Analyst Blog:
A Week for the Central Banks: Global Week Ahead
This is a Global Week Ahead full of major central bank decisions.
Policymakers in the United States, Japan, and Britain are all due to reconsider their policy lending rates.
Meanwhile, share markets will be on edge, over more earnings from 4 U.S. tech giants.
In Venezuela, voters headed to the polls on Sunday, to try elect a new President.
Next are Reuters’ five world market themes, reordered for equity traders—
(1) On Wednesday, the FOMC and Powell Supply Guidance. Plus, on Friday, July Nonfarm Payrolls Come Out.
The steep selloff in markets in recent days is shining a spotlight on the Federal Reserve, which concludes its July monetary policy meeting on Wednesday.
Signs of economic concern from the Fed could give investors — already unnerved by turbulence in U.S. tech stocks — yet another reason to worry.
As it is, investors believe the time to ease monetary policy is swiftly approaching: futures tied to the Fed funds rate show investors pricing in a more than 90% chance of a September rate cut amid evidence of cooling inflation and a nascent downshift in the jobs market.
U.S. employment data due Aug. 2nd will give investors the opportunity to assess whether the gradual signs of slowing that bolstered rate cut expectations have continued in July.
Economists polled by Reuters expect the U.S. to have created +185K jobs in July, compared with +206K in the prior month.
(2) Four Mega-cap Tech Stocks Report Q2-24 Earnings.
Spooked investors also face a minefield of Big Tech earnings, with misses threatening to further upend a market roiled by worries over stretched stock valuations.
Microsoft is scheduled to report earnings on Tuesday, followed by Facebook-parent Meta on Wednesday and Apple and Amazon on Thursday.
Disappointing numbers could reignite the worries that caused a crushing selloff in U.S. stocks on Wednesday, when both the S&P 500 and Nasdaq suffered their worst day since late 2022.
The huge run-up in tech stocks may have set a high bar for their results. Google-parent Alphabet, whose earnings were one of the triggers for the recent selloff, actually reported better-than-expected revenue.
But investors grow wary that rising spending on AI infrastructure could squeeze margins, sending the shares -5% lower.
(3) On Wednesday, Will the Bank of Japan (BoJ) Hike its Policy Rate?
Speculation is growing that the Bank of Japan could hike rates on Wednesday after high-profile politicians — including the prime minister — hinted at the need for near-term policy normalization.
It's not the need to end decades of extraordinary stimulus, per se, that is at the heart of their arguments.
Rather, the weak yen's choking effect on households and businesses that looks to be turning the exchange rate into a central issue for the ruling Liberal Democratic Party's leadership convention in September.
The fact that the currency has rebounded by a staggering 10 yen per dollar from three-decade lows at the start of the month hasn't deterred some from predicting a July hike.
They argue the BOJ can get the most bang for its buck by hiking into a rallying yen.
Others worry a fragile economy and weak consumer sentiment couldn't weather higher borrowing costs, with slowing U.S. growth set to have a knock-on effect already.
(4) On Thursday, the Bank of England (BoE) Meets.
The Bank of England meets on Thursday and right now, markets see a roughly 48% chance that rates will fall for the first time since March 2020.
Growth is modest and consumer inflation has returned to 2%. Yet wage growth and service-sector inflation are proving sticky and running hotter than a number of policy-setters at the Old Lady of Threadneedle Street, as the Bank of England is known, would like.
Clare Lombardelli, the new deputy governor, may hold the deciding vote, as the other eight Monetary Policy Committee members are split evenly on whether to hold or cut.
British consumers might be feeling the pinch of interest rates at more than 14-year highs, but banks have certainly reaped the benefits.
Markets will watch results from HSBC, Barclays and Standard Chartered to get a sense of how well they are likely to fare when borrowing costs, and the profit they make on them, start to fall.
(5) On Sunday, Venezuelans Vote for a President.
Venezuelans tried to elect a new president on Sunday.
Opposition candidate Edmundo Gonzalez led polls by 20 points over incumbent Nicolas Maduro, who pledged the election will be transparent, but forced the winner of the opposition primary, Maria Corina Machado, out of the race.
The results and handling of the vote is one half of the puzzle determining future U.S. sanctions on Venezuela — the battle for the White House is, of course, yet to come in November.
Current curbs include a ban on buying bonds directly from Venezuela's government. That precludes, for now, a restructuring of some $60 billion in international bonds owed by the government and state-owned oil firm PDVSA.
Venezuela's and PDVSA's defaulted bonds trade at deeply distressed levels of 13-22 cents, but have rallied sharply from late last year's single-digits.
Investors are watching Maduro's handling of the election very closely…
On Monday, President Nicolas Maduro and opposition rival Edmundo Gonzalez both claimed victory in Venezuela's presidential election as Washington and other foreign governments cast doubt on official results that kept the incumbent in power.
The national electoral authority said just after midnight that Maduro had won a third term with 51% of the vote - a result that would extend a quarter-century of socialist rule.
Zacks #1 Rank (STRONG BUY) Stocks
(1) Plains All American Pipeline: This is an $18 a share stock with a market cap of $12.9B. It is found in the Oil & Gas – Production Pipeline industry. I see a Zacks Value score of A, a Zacks Growth score of A and a Zacks Momentum score of C.
Founded in 1998, Houston, TX-based Plains All American Pipeline, L.P., a master limited partnership (MLP), is involved in the transportation, storage and marketing of crude oil, natural gas, natural gas liquids (NGL) and refined products in the U.S. and Canada.
The partnership has operations in the Permian Basin, South Texas/Eagle Ford area, Rocky Mountain and Gulf Coast in the U.S., and Manito, South Saskatchewan, Rainbow in Canada.
The firm reorganized the historical operating segments — namely Transportation, Facilities and Supply and Logistics — into two operating segments: Crude Oil and Natural gas liquids (NGL).
The reorganization of segments was done, due to several reasons including a multi-year transition in the midstream energy industry driven by increased competition.
That has reduced stand-alone earnings opportunities of the firm’s supply and logistics activities, as well as internal changes regarding the oversight and reporting of its assets, and related results of operations.
The new segments will provide better visibility and transparency into the drivers of the firm’s overall business and reduce inter-segment activity.
Crude Oil segment assets include pipelines, storage, terminalling and trucks. This segment generates revenues from long-term minimum volume commitments, acreage dedications, leased capacity & spot utilization.
The Crude Oil segment will be driven by an increase in production volumes and rise in volume throughput.
NGL segment assets include fractionation, straddle, pipelines, storage, terminalling & rail capacity. This segment generates revenues from leased capacity, throughput, processing agreements & spot utilization.
The segment’s growth will be driven by Frac spread, supply volumes and regional pricing differentials.
In 2023, the Crude Oil and NGL segment contributed 96.1% and 3.9%, respectively, to total revenues. In 2022, the segments contributed 95.2% and 4.8%, respectively, to total revenues.
(2) Chewy: This is a $25 a share stock with a market cap of $11B. It is found in the Internet Commerce industry. I see a Zacks Value score of C, a Zacks Growth score of A and a Zacks Momentum score of B.
Chewy Inc. operates as an online pet retailer.
The company offers pet products which include dry and wet food, toys, mats, biscuits, vitamins and supplements.
Chewy Inc. is based in Dania Beach, Florida, United States.
(3) FTAI Aviation Ltd.: This is a $105 a share stock with a market cap of $10.95B. It is found in the Aerospace-Defense Equipment industry. I see a Zacks Value score of F, a Zacks Growth score of C and a Zacks Momentum score of F.
FTAI Aviation Ltd. owns and maintains commercial jet engines with a focus on CFM56 engines.
Its proprietary portfolio of products, including The Module Factory and a JV to manufacture engine PMA.
FTAI Aviation Ltd., formerly known as Fortress Transportation and Infrastructure Investors LLC, is based in New York.
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.
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 HSBC, Barclays, Plains All American Pipeline, Chewy and FTAI Aviation
For Immediate Release
Chicago, IL – July 30, 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: HSBC (HSBC - Free Report) , Barclays (BCS - Free Report) , Plains All American Pipeline (PAA - Free Report) , Chewy (CHWY - Free Report) and FTAI Aviation Ltd. (FTAI - Free Report) .
Here are highlights from Monday’s Analyst Blog:
A Week for the Central Banks: Global Week Ahead
This is a Global Week Ahead full of major central bank decisions.
Policymakers in the United States, Japan, and Britain are all due to reconsider their policy lending rates.
Meanwhile, share markets will be on edge, over more earnings from 4 U.S. tech giants.
In Venezuela, voters headed to the polls on Sunday, to try elect a new President.
Next are Reuters’ five world market themes, reordered for equity traders—
(1) On Wednesday, the FOMC and Powell Supply Guidance. Plus, on Friday, July Nonfarm Payrolls Come Out.
The steep selloff in markets in recent days is shining a spotlight on the Federal Reserve, which concludes its July monetary policy meeting on Wednesday.
Signs of economic concern from the Fed could give investors — already unnerved by turbulence in U.S. tech stocks — yet another reason to worry.
As it is, investors believe the time to ease monetary policy is swiftly approaching: futures tied to the Fed funds rate show investors pricing in a more than 90% chance of a September rate cut amid evidence of cooling inflation and a nascent downshift in the jobs market.
U.S. employment data due Aug. 2nd will give investors the opportunity to assess whether the gradual signs of slowing that bolstered rate cut expectations have continued in July.
Economists polled by Reuters expect the U.S. to have created +185K jobs in July, compared with +206K in the prior month.
(2) Four Mega-cap Tech Stocks Report Q2-24 Earnings.
Spooked investors also face a minefield of Big Tech earnings, with misses threatening to further upend a market roiled by worries over stretched stock valuations.
Microsoft is scheduled to report earnings on Tuesday, followed by Facebook-parent Meta on Wednesday and Apple and Amazon on Thursday.
Disappointing numbers could reignite the worries that caused a crushing selloff in U.S. stocks on Wednesday, when both the S&P 500 and Nasdaq suffered their worst day since late 2022.
The huge run-up in tech stocks may have set a high bar for their results. Google-parent Alphabet, whose earnings were one of the triggers for the recent selloff, actually reported better-than-expected revenue.
But investors grow wary that rising spending on AI infrastructure could squeeze margins, sending the shares -5% lower.
(3) On Wednesday, Will the Bank of Japan (BoJ) Hike its Policy Rate?
Speculation is growing that the Bank of Japan could hike rates on Wednesday after high-profile politicians — including the prime minister — hinted at the need for near-term policy normalization.
It's not the need to end decades of extraordinary stimulus, per se, that is at the heart of their arguments.
Rather, the weak yen's choking effect on households and businesses that looks to be turning the exchange rate into a central issue for the ruling Liberal Democratic Party's leadership convention in September.
The fact that the currency has rebounded by a staggering 10 yen per dollar from three-decade lows at the start of the month hasn't deterred some from predicting a July hike.
They argue the BOJ can get the most bang for its buck by hiking into a rallying yen.
Others worry a fragile economy and weak consumer sentiment couldn't weather higher borrowing costs, with slowing U.S. growth set to have a knock-on effect already.
(4) On Thursday, the Bank of England (BoE) Meets.
The Bank of England meets on Thursday and right now, markets see a roughly 48% chance that rates will fall for the first time since March 2020.
Growth is modest and consumer inflation has returned to 2%. Yet wage growth and service-sector inflation are proving sticky and running hotter than a number of policy-setters at the Old Lady of Threadneedle Street, as the Bank of England is known, would like.
Clare Lombardelli, the new deputy governor, may hold the deciding vote, as the other eight Monetary Policy Committee members are split evenly on whether to hold or cut.
British consumers might be feeling the pinch of interest rates at more than 14-year highs, but banks have certainly reaped the benefits.
Markets will watch results from HSBC, Barclays and Standard Chartered to get a sense of how well they are likely to fare when borrowing costs, and the profit they make on them, start to fall.
(5) On Sunday, Venezuelans Vote for a President.
Venezuelans tried to elect a new president on Sunday.
Opposition candidate Edmundo Gonzalez led polls by 20 points over incumbent Nicolas Maduro, who pledged the election will be transparent, but forced the winner of the opposition primary, Maria Corina Machado, out of the race.
The results and handling of the vote is one half of the puzzle determining future U.S. sanctions on Venezuela — the battle for the White House is, of course, yet to come in November.
Current curbs include a ban on buying bonds directly from Venezuela's government. That precludes, for now, a restructuring of some $60 billion in international bonds owed by the government and state-owned oil firm PDVSA.
Venezuela's and PDVSA's defaulted bonds trade at deeply distressed levels of 13-22 cents, but have rallied sharply from late last year's single-digits.
Investors are watching Maduro's handling of the election very closely…
On Monday, President Nicolas Maduro and opposition rival Edmundo Gonzalez both claimed victory in Venezuela's presidential election as Washington and other foreign governments cast doubt on official results that kept the incumbent in power.
The national electoral authority said just after midnight that Maduro had won a third term with 51% of the vote - a result that would extend a quarter-century of socialist rule.
Zacks #1 Rank (STRONG BUY) Stocks
(1) Plains All American Pipeline: This is an $18 a share stock with a market cap of $12.9B. It is found in the Oil & Gas – Production Pipeline industry. I see a Zacks Value score of A, a Zacks Growth score of A and a Zacks Momentum score of C.
Founded in 1998, Houston, TX-based Plains All American Pipeline, L.P., a master limited partnership (MLP), is involved in the transportation, storage and marketing of crude oil, natural gas, natural gas liquids (NGL) and refined products in the U.S. and Canada.
The partnership has operations in the Permian Basin, South Texas/Eagle Ford area, Rocky Mountain and Gulf Coast in the U.S., and Manito, South Saskatchewan, Rainbow in Canada.
The firm reorganized the historical operating segments — namely Transportation, Facilities and Supply and Logistics — into two operating segments: Crude Oil and Natural gas liquids (NGL).
The reorganization of segments was done, due to several reasons including a multi-year transition in the midstream energy industry driven by increased competition.
That has reduced stand-alone earnings opportunities of the firm’s supply and logistics activities, as well as internal changes regarding the oversight and reporting of its assets, and related results of operations.
The new segments will provide better visibility and transparency into the drivers of the firm’s overall business and reduce inter-segment activity.
Crude Oil segment assets include pipelines, storage, terminalling and trucks. This segment generates revenues from long-term minimum volume commitments, acreage dedications, leased capacity & spot utilization.
The Crude Oil segment will be driven by an increase in production volumes and rise in volume throughput.
NGL segment assets include fractionation, straddle, pipelines, storage, terminalling & rail capacity. This segment generates revenues from leased capacity, throughput, processing agreements & spot utilization.
The segment’s growth will be driven by Frac spread, supply volumes and regional pricing differentials.
In 2023, the Crude Oil and NGL segment contributed 96.1% and 3.9%, respectively, to total revenues. In 2022, the segments contributed 95.2% and 4.8%, respectively, to total revenues.
(2) Chewy: This is a $25 a share stock with a market cap of $11B. It is found in the Internet Commerce industry. I see a Zacks Value score of C, a Zacks Growth score of A and a Zacks Momentum score of B.
Chewy Inc. operates as an online pet retailer.
The company offers pet products which include dry and wet food, toys, mats, biscuits, vitamins and supplements.
Chewy Inc. is based in Dania Beach, Florida, United States.
(3) FTAI Aviation Ltd.: This is a $105 a share stock with a market cap of $10.95B. It is found in the Aerospace-Defense Equipment industry. I see a Zacks Value score of F, a Zacks Growth score of C and a Zacks Momentum score of F.
FTAI Aviation Ltd. owns and maintains commercial jet engines with a focus on CFM56 engines.
Its proprietary portfolio of products, including The Module Factory and a JV to manufacture engine PMA.
FTAI Aviation Ltd., formerly known as Fortress Transportation and Infrastructure Investors LLC, is based in New York.
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.