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Interactive Brokers and Walgreens Boots Alliance have been highlighted as Zacks Bull and Bear of the Day
Read MoreHide Full Article
For Immediate Release
Chicago, IL – August 16, 2024 – Zacks Equity Research shares Interactive Brokers Group (IBKR - Free Report) as the Bull of the Day and Walgreens Boots Alliance (WBA - Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on PulteGroup, Inc. (PHM - Free Report) , Micron Technology, Inc. (MU - Free Report) and Atmos Energy Corporation (ATO - Free Report) .
Interactive Brokers Group operates as an automated global electronic market maker and broker. Analysts have positively revised expectations across the board, landing the stock into a Zacks Rank #1 (Strong Buy).
Let's take a closer look at how the company currently stacks up.
Interactive Brokers Posts Robust Results
IBKR shares have delivered a strong performance in 2024, up nearly 46% and widely outperforming relative to the S&P 500. Favorable quarterly results have aided the move, with the company exceeding the Zacks Consensus EPS estimate in back-to-back releases.
The company's results have been aided by higher customer trading volumes, with volumes in options, stocks, and futures increasing 35%, 26%, and 10%, respectively, throughout its latest period.
In addition, customers continue flocking to the platform, with customer accounts growing a notable 28% year-over-year to 2.9 million. Net interest income has also shown nice growth, moving 14% higher thanks to higher benchmark interest rates and customer credit balances.
The valuation picture here isn't rich for the stock, with the current 17.1X forward 12-month earnings multiple primarily in line with the five-year median. The current PEG ratio works out to 1.0X, reflecting that investors are paying a fair price for the forecasted growth.
Zacks Consensus expectations for Interactive Brokers suggest 18% EPS growth on 14% higher sales. The stock sports a Style Score of 'B' for Growth.
Bottom Line
Investors can implement a stellar strategy to find expected winners by taking advantage of the Zacks Rank – one of the most powerful market tools that provides a massive edge.
The top 5% of all stocks receive the highly coveted Zacks Rank #1 (Strong Buy). These stocks should outperform the market more than any other rank.
Interactive Brokers would be an excellent stock for investors to consider, as displayed by its Zack Rank #1 (Strong Buy).
Walgreens Boots Alliance is a retail drugstore chain that sells prescription and non-prescription drugs. The company also sells general merchandise products, including household items, convenience and fresh foods, personal care, beauty care, photofinishing, and candy.
Analysts have taken a bearish stance on the company's outlook, landing the stock into a Zacks Rank #5 (Strong Sell).
In addition, the company is in the Zacks Retail – Pharmacies and Drug Stores industry, which is currently ranked in the bottom 1% of all Zacks industries.
Let's take a closer look at the company.
Walgreens Faces Pressure
WBA shares have faced consistent pressure year-to-date, down more than 55% and widely underperforming. A recent set of weak quarterly results caused a post-earnings share plunge, with the company falling short of EPS expectations but delivering a modest sales beat.
Quarterly results in 2024 have consistently brought post-earnings selling pressure, with prints unable to excite investors.
Following its latest release, CEO Tim Wentworth said:
'We continue to face a difficult operating environment, including persistent pressures on the U.S. consumer and the impact of recent marketplace dynamics which have eroded pharmacy margins. Our results and outlook reflect these headwinds, despite solid performance in both our International and U.S. Healthcare segments.'
Shares yield 9% annually now following the steep decline, though it's critical to note that investors should remain on the sidelines until the company's earnings picture shifts positively and it provides further guidance on its strategic initiatives.
Bottom Line
Margin pressures and weak quarterly results paint a challenging picture for the company's shares in the near term.
Walgreens Boots Alliance is a Zacks Rank #5 (Strong Sell), indicating that analysts have taken a bearish stance on the company's earnings outlook.
For those seeking strong stocks, a great idea would be to focus on stocks carrying a Zacks Rank #1 (Strong Buy) or a Zacks Rank #2 (Buy) – these stocks sport a notably stronger earnings outlook paired with the potential to deliver explosive gains in the near term.
Additional content:
Tamed Inflation Bolsters September Rate Cut: PHM, MU, ATO to Gain
The Federal Reserve has kept interest rates at record-high levels for quite some time, citing additional progress in price pressures ebbing toward the central bank's target of 2%. However, July's doomed jobs data raised recession fearmongering and compelled market participants to believe that the Fed has been a bit late in slashing interest rates.
Nevertheless, cooling consumer and wholesale prices last month strengthened hopes that the Fed would initiate an interest rate cut in September, even if it won't be supersized. Despite rising shelter costs, unchanged energy prices and a fall in new and used car prices helped broader inflationary pressure retreat in July.
The US Bureau of Labor Statistics noted that the consumer price index (CPI) increased 2.9% year over year in July, less than June's 12-month inflation rate of 3%, and the annual rate is also the lowest reading since March 2021. The yearly rate of the core CPI that eliminates the unpredictable fuel and food prices increased 3.2% last month, the lowest reading since April 2021.
Similarly, the producer price index (PPI) increased 2.2% year over year in July, marking a significant drop from June's yearly rate of 2.7%. Prices of goods and raw materials have fallen substantially from the big spike in 2021 and 2022.
The PPI figure is important since it directly impacts the Fed's preferred gauge, the personal consumption expenditures (PCE) index. The PCE index increased 2.5% year over year in June, less than May's yearly rise of 2.6%, added the Bureau of Economic Analysis.
Thus, moderating inflation has assured investors of a quarter-point interest rate cut, if not a half-point reduction in the Fed's policy meeting next month. Almost 63.5% of traders expect the Fed to trim interest rates by 25 basis points, versus 45% one week ago, per the CME FedWatch Tool. Many of them also believe that there will be a minimum of two interest rate cuts this year.
Rate Cuts Are a Blessing for Homebuilders
Mortgage rates tend to fall amid interest rate cuts. This increases the demand for houses, which boosts the profit margins of homebuilders such as PulteGroup, Inc..
At the same time, homebuilders' input costs get reduced when interest rates are trimmed. Mortgage rates are 6.59% this week, the lowest since May 2023, per Bankrate's latest survey (read more: Plunge in Mortgage Rates Are a Boon for PHM, KBH, MHO).
The Zacks Consensus Estimate for PHM's current-year earnings has increased nearly 4% over the past 60 days. The company's expected earnings growth rate for the current year is almost 14%. PHM currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 (Strong Buy) Rank stocks here.
Tech Stocks Thrive in a Low Interest Rate Scenario
Interest rate cuts are a boon for semiconductor memory solutions provider Micron Technology, Inc. since lower borrowing costs would uplift the company's profit margins and its cash flows won't be affected, further leading to investments in research and development.
The Zacks Consensus Estimate for MU's current-year earnings has increased 26.1% over the past 60 days. The company's expected earnings growth rate for the current year is 126.1%. MU currently has a Zacks Rank #2.
Rate Cuts Work Wonders for Utility Players
Utility stock, Atmos Energy Corporation engages in natural gas distribution business in the United States. Interest rate cuts would reduce Atmos Energy's debt level, help the company pay off dues, and boost profitability.
The Zacks Consensus Estimate for ATO's current-year earnings has increased 0.9% over the past 60 days. The company's expected earnings growth rate for the current year is 11.3%. ATO presently has a Zacks Rank #2.
Shares of PulteGroup, Micron Technology, and Atmos Energy have gained 19.2%, 9.1%, and 10.5%, respectively, year to date.
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Today you can access their live picks without cost or obligation.
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
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/performancefor information about the performance numbers displayed in this press release.
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Interactive Brokers and Walgreens Boots Alliance have been highlighted as Zacks Bull and Bear of the Day
For Immediate Release
Chicago, IL – August 16, 2024 – Zacks Equity Research shares Interactive Brokers Group (IBKR - Free Report) as the Bull of the Day and Walgreens Boots Alliance (WBA - Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on PulteGroup, Inc. (PHM - Free Report) , Micron Technology, Inc. (MU - Free Report) and Atmos Energy Corporation (ATO - Free Report) .
Here is a synopsis of all five stocks:
Bull of the Day:
Interactive Brokers Group operates as an automated global electronic market maker and broker. Analysts have positively revised expectations across the board, landing the stock into a Zacks Rank #1 (Strong Buy).
Let's take a closer look at how the company currently stacks up.
Interactive Brokers Posts Robust Results
IBKR shares have delivered a strong performance in 2024, up nearly 46% and widely outperforming relative to the S&P 500. Favorable quarterly results have aided the move, with the company exceeding the Zacks Consensus EPS estimate in back-to-back releases.
The company's results have been aided by higher customer trading volumes, with volumes in options, stocks, and futures increasing 35%, 26%, and 10%, respectively, throughout its latest period.
In addition, customers continue flocking to the platform, with customer accounts growing a notable 28% year-over-year to 2.9 million. Net interest income has also shown nice growth, moving 14% higher thanks to higher benchmark interest rates and customer credit balances.
The valuation picture here isn't rich for the stock, with the current 17.1X forward 12-month earnings multiple primarily in line with the five-year median. The current PEG ratio works out to 1.0X, reflecting that investors are paying a fair price for the forecasted growth.
Zacks Consensus expectations for Interactive Brokers suggest 18% EPS growth on 14% higher sales. The stock sports a Style Score of 'B' for Growth.
Bottom Line
Investors can implement a stellar strategy to find expected winners by taking advantage of the Zacks Rank – one of the most powerful market tools that provides a massive edge.
The top 5% of all stocks receive the highly coveted Zacks Rank #1 (Strong Buy). These stocks should outperform the market more than any other rank.
Interactive Brokers would be an excellent stock for investors to consider, as displayed by its Zack Rank #1 (Strong Buy).
Bear of the Day:
Walgreens Boots Alliance is a retail drugstore chain that sells prescription and non-prescription drugs. The company also sells general merchandise products, including household items, convenience and fresh foods, personal care, beauty care, photofinishing, and candy.
Analysts have taken a bearish stance on the company's outlook, landing the stock into a Zacks Rank #5 (Strong Sell).
In addition, the company is in the Zacks Retail – Pharmacies and Drug Stores industry, which is currently ranked in the bottom 1% of all Zacks industries.
Let's take a closer look at the company.
Walgreens Faces Pressure
WBA shares have faced consistent pressure year-to-date, down more than 55% and widely underperforming. A recent set of weak quarterly results caused a post-earnings share plunge, with the company falling short of EPS expectations but delivering a modest sales beat.
Quarterly results in 2024 have consistently brought post-earnings selling pressure, with prints unable to excite investors.
Following its latest release, CEO Tim Wentworth said:
'We continue to face a difficult operating environment, including persistent pressures on the U.S. consumer and the impact of recent marketplace dynamics which have eroded pharmacy margins. Our results and outlook reflect these headwinds, despite solid performance in both our International and U.S. Healthcare segments.'
Shares yield 9% annually now following the steep decline, though it's critical to note that investors should remain on the sidelines until the company's earnings picture shifts positively and it provides further guidance on its strategic initiatives.
Bottom Line
Margin pressures and weak quarterly results paint a challenging picture for the company's shares in the near term.
Walgreens Boots Alliance is a Zacks Rank #5 (Strong Sell), indicating that analysts have taken a bearish stance on the company's earnings outlook.
For those seeking strong stocks, a great idea would be to focus on stocks carrying a Zacks Rank #1 (Strong Buy) or a Zacks Rank #2 (Buy) – these stocks sport a notably stronger earnings outlook paired with the potential to deliver explosive gains in the near term.
Additional content:
Tamed Inflation Bolsters September Rate Cut: PHM, MU, ATO to Gain
The Federal Reserve has kept interest rates at record-high levels for quite some time, citing additional progress in price pressures ebbing toward the central bank's target of 2%. However, July's doomed jobs data raised recession fearmongering and compelled market participants to believe that the Fed has been a bit late in slashing interest rates.
Nevertheless, cooling consumer and wholesale prices last month strengthened hopes that the Fed would initiate an interest rate cut in September, even if it won't be supersized. Despite rising shelter costs, unchanged energy prices and a fall in new and used car prices helped broader inflationary pressure retreat in July.
The US Bureau of Labor Statistics noted that the consumer price index (CPI) increased 2.9% year over year in July, less than June's 12-month inflation rate of 3%, and the annual rate is also the lowest reading since March 2021. The yearly rate of the core CPI that eliminates the unpredictable fuel and food prices increased 3.2% last month, the lowest reading since April 2021.
Similarly, the producer price index (PPI) increased 2.2% year over year in July, marking a significant drop from June's yearly rate of 2.7%. Prices of goods and raw materials have fallen substantially from the big spike in 2021 and 2022.
The PPI figure is important since it directly impacts the Fed's preferred gauge, the personal consumption expenditures (PCE) index. The PCE index increased 2.5% year over year in June, less than May's yearly rise of 2.6%, added the Bureau of Economic Analysis.
Thus, moderating inflation has assured investors of a quarter-point interest rate cut, if not a half-point reduction in the Fed's policy meeting next month. Almost 63.5% of traders expect the Fed to trim interest rates by 25 basis points, versus 45% one week ago, per the CME FedWatch Tool. Many of them also believe that there will be a minimum of two interest rate cuts this year.
Rate Cuts Are a Blessing for Homebuilders
Mortgage rates tend to fall amid interest rate cuts. This increases the demand for houses, which boosts the profit margins of homebuilders such as PulteGroup, Inc..
At the same time, homebuilders' input costs get reduced when interest rates are trimmed. Mortgage rates are 6.59% this week, the lowest since May 2023, per Bankrate's latest survey (read more: Plunge in Mortgage Rates Are a Boon for PHM, KBH, MHO).
The Zacks Consensus Estimate for PHM's current-year earnings has increased nearly 4% over the past 60 days. The company's expected earnings growth rate for the current year is almost 14%. PHM currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 (Strong Buy) Rank stocks here.
Tech Stocks Thrive in a Low Interest Rate Scenario
Interest rate cuts are a boon for semiconductor memory solutions provider Micron Technology, Inc. since lower borrowing costs would uplift the company's profit margins and its cash flows won't be affected, further leading to investments in research and development.
The Zacks Consensus Estimate for MU's current-year earnings has increased 26.1% over the past 60 days. The company's expected earnings growth rate for the current year is 126.1%. MU currently has a Zacks Rank #2.
Rate Cuts Work Wonders for Utility Players
Utility stock, Atmos Energy Corporation engages in natural gas distribution business in the United States. Interest rate cuts would reduce Atmos Energy's debt level, help the company pay off dues, and boost profitability.
The Zacks Consensus Estimate for ATO's current-year earnings has increased 0.9% over the past 60 days. The company's expected earnings growth rate for the current year is 11.3%. ATO presently has a Zacks Rank #2.
Shares of PulteGroup, Micron Technology, and Atmos Energy have gained 19.2%, 9.1%, and 10.5%, respectively, year to date.
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 >>
Media Contact
Zacks Investment Research
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Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
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/performancefor information about the performance numbers displayed in this press release.