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The Zacks Analyst Blog Highlights Spotify, Aspen, Maplebear, Paramount Global and Seagate
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For Immediate Release
Chicago, IL – August 20, 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: Spotify Technology S.A. (SPOT - Free Report) , Aspen Technology Inc. (AZPN - Free Report) , Maplebear Inc. (CART - Free Report) , Paramount Global (PARAA - Free Report) and Seagate Technology Holdings plc (STX - Free Report) .
Last week was fabulous for U.S. stock markets as the three major stock indexes — the Dow, the S&P 500 and the Nasdaq Composite — rallied 2.9%, 3.9% and 5.2%, respectively. The broad-market index — the S&P 500 — recorded its best week since November 2023. This helped Wall Street to recoup all losses that it suffered during the meltdown in the first week of August.
The meltdown was driven by weak nonfarm payrolls of July that raised concern of a near-term recession as a section of economists and financial experts feared that the Fed may be too late to cut the benchmark interest rate.
However, in the last couple of weeks, Wall Street witnessed several strong economic data. A solid services sector PMI, and an unexpected rise in retail and core retail sales in July, two consecutive lower-than-expected weekly jobless claims, a better-than-expected consumer sentiment index for August and dwindling inflation rate boosted investors’ confidence in the Fed’s much-hyped “soft landing” theory.
U.S. stock markets witnessed an impressive first seven months of 2024 after an astonishing 2023. Wall Street’s bull run has got an added boost this year, to the surprise of a large section of financial pandits, who indiscriminately warned of overvaluation.
Theoretically a recession means contraction of GDP (negative GDP growth rate) for two consecutive quarters. The U.S. GDP grew 1.4% in first-quarter 2024. The first reading of second-quarter GDP was 2.8%. On Aug 16, the Atlanta Fed GDPNow projected a 2% GDP growth rate for the third quarter.
Some soft key economic data over a period of time never indicate a nearby recession. In fact, the Fed was eagerly waiting for these weak economic data, especially labor market data, along with a gradually declining inflation rate, in order to initiate a rate-cut regime.
A Goldilocks Environment?
A Goldilocks scenario is characterized by continuous economic growth but not as much a rapid pace to inflate the aggregate price level to such an extent that the central bank is compelled to tighten monetary policies.
The U.S. economy has cooled but is growing at a pace similar to that of the pre-pandemic level. The labor market has shown signs of crack, but not at an alarming pace. The peak inflation rate is far behind us and is reducing gradually to the Fed’s 2% target rate. Finally, there are no signs of any near-term recession.
At this stage, it should be prudent to invest in those stocks that have shown strong momentum recently. These stocks, along with a Zacks Rank should be fruitful for investors in the near future.
Our Top Picks
We have narrowed our search to five stocks that have solid momentum. These companies have strong potential for the rest of 2024 and have seen positive earnings estimate revisions in the last 30 days. Each of our picks carries a Zacks Rank #1 (Strong Buy) and has a Momentum Score of A. You can see the complete list of today’s Zacks #1 Rank stocks here.
Spotify Technology S.A. provides audio streaming services worldwide. SPOT operates through two segments, Premium and Ad-Supported. The Premium segment offers unlimited online and offline streaming access to its catalog of music and podcasts without commercial breaks to its subscribers.
The Ad-Supported segment provides on-demand online access to its catalog of music and unlimited online access to the catalog of podcasts to its subscribers on their computers, tablets, and compatible mobile devices. SPOT also offers sales, distribution and marketing, contract research and development, and customer support services.
Spotify Technology has an expected revenue and earnings growth rate of 19.4% and more than 100%, respectively, for the current year. The Zacks Consensus Estimate for current-quarter, next-quarter, current-year and next-year earnings has improved over the last 30 days.
Aspen Technology Inc.’s fiscal fourth-quarter results gained from continued momentum in the DGM and SSE segments. The integration efforts between the Heritage AspenTech, DGM and SSE businesses is an encouraging development. The DGM segment of AZPN saw nearly 40% year-over-year ACV growth driven by solid demand trends and improved funding.
Higher demand across the upstream market is aiding the AZPN’s SSE business. Strength in Utilities and Energy verticals bode well. AZPN reported an ACV of $968.3 million, marking a 9.4% year-over-year growth. This ACV performance does not include the $35.5 million ACV write-off stemming from the suspension of all commercial activities in Russia amid expanded sanctions.
Aspen Technology has an expected revenue and earnings growth rate of 5.5% and 12.8%, respectively, for the current year (ending June 2025). The Zacks Consensus Estimate for current-quarter, next-quarter, current-year and next-year earnings has improved over the last 30 days.
Maplebear Inc. is a grocery technology company principally in North America that works with grocers and retailers to transform how people shop. CART’s Instacart Platform offers retailers a suite of enterprise-grade technology products and services to power their e-commerce experiences, fulfill orders, digitize brick-and-mortar stores, provide advertising services, and glean insights. CART also operates virtual convenience stores; and provides software-as-a-service solutions to retailers.
Maplebear has an expected revenue and earnings growth rate of 11% and more than 100%, respectively, for the current year. The Zacks Consensus Estimate for current-quarter, next-quarter, current-year and next-year earnings has improved over the last 30 days.
Paramount Global operates as a media, streaming, and entertainment company worldwide. PARAA operates through TV Media, Direct-to-Consumer, and Filmed Entertainment segments. PARAA’s portfolio of consumer brands includes CBS, Showtime Networks, Paramount Pictures, Nickelodeon, MTV, Comedy Central, BET, Paramount, Pluto TV and Simon & Schuster, among others.
Paramount Global has an expected revenue and earnings growth rate of 0.2% and more than 100%, respectively, for the current year. The Zacks Consensus Estimate for current-quarter, next-quarter, current-year and next-year earnings has improved over the last 30 days.
Seagate Technology Holdings plc’s fourth-quarter performance was propelled by momentum in mass capacity solutions due to stronger nearline cloud demand. These factors are expected to drive STX’s top-line growth in the current quarter. Mass Capacity exabyte shipments constitute more than 90% of total exabyte shipments. Pricing initiatives and a favorable product mix are aiding margin performance.
STX’s launch of Mozaic 3+ hard drive platform positions it well to benefit from megatrends like AI and machine learning. This is expected to boost demand for mass-capacity storage solutions over the long term. STX expects to complete the qualification with a lead CSP customer and initiate several cloud-customer qualifications in the current quarter.
Seagate Technology has an expected revenue and earnings growth rate of 42.8% and more than 100%, respectively, for the current year (ending June 2025). The Zacks Consensus Estimate for current-quarter, next-quarter, current-year and next-year earnings has improved over the last seven days.
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 Spotify, Aspen, Maplebear, Paramount Global and Seagate
For Immediate Release
Chicago, IL – August 20, 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: Spotify Technology S.A. (SPOT - Free Report) , Aspen Technology Inc. (AZPN - Free Report) , Maplebear Inc. (CART - Free Report) , Paramount Global (PARAA - Free Report) and Seagate Technology Holdings plc (STX - Free Report) .
Here are highlights from Monday’s Analyst Blog:
"Soft Landing" Hopes Resurface: 5 Momentum Stock Picks
Last week was fabulous for U.S. stock markets as the three major stock indexes — the Dow, the S&P 500 and the Nasdaq Composite — rallied 2.9%, 3.9% and 5.2%, respectively. The broad-market index — the S&P 500 — recorded its best week since November 2023. This helped Wall Street to recoup all losses that it suffered during the meltdown in the first week of August.
The meltdown was driven by weak nonfarm payrolls of July that raised concern of a near-term recession as a section of economists and financial experts feared that the Fed may be too late to cut the benchmark interest rate.
However, in the last couple of weeks, Wall Street witnessed several strong economic data. A solid services sector PMI, and an unexpected rise in retail and core retail sales in July, two consecutive lower-than-expected weekly jobless claims, a better-than-expected consumer sentiment index for August and dwindling inflation rate boosted investors’ confidence in the Fed’s much-hyped “soft landing” theory.
U.S. stock markets witnessed an impressive first seven months of 2024 after an astonishing 2023. Wall Street’s bull run has got an added boost this year, to the surprise of a large section of financial pandits, who indiscriminately warned of overvaluation.
Theoretically a recession means contraction of GDP (negative GDP growth rate) for two consecutive quarters. The U.S. GDP grew 1.4% in first-quarter 2024. The first reading of second-quarter GDP was 2.8%. On Aug 16, the Atlanta Fed GDPNow projected a 2% GDP growth rate for the third quarter.
Some soft key economic data over a period of time never indicate a nearby recession. In fact, the Fed was eagerly waiting for these weak economic data, especially labor market data, along with a gradually declining inflation rate, in order to initiate a rate-cut regime.
A Goldilocks Environment?
A Goldilocks scenario is characterized by continuous economic growth but not as much a rapid pace to inflate the aggregate price level to such an extent that the central bank is compelled to tighten monetary policies.
The U.S. economy has cooled but is growing at a pace similar to that of the pre-pandemic level. The labor market has shown signs of crack, but not at an alarming pace. The peak inflation rate is far behind us and is reducing gradually to the Fed’s 2% target rate. Finally, there are no signs of any near-term recession.
At this stage, it should be prudent to invest in those stocks that have shown strong momentum recently. These stocks, along with a Zacks Rank should be fruitful for investors in the near future.
Our Top Picks
We have narrowed our search to five stocks that have solid momentum. These companies have strong potential for the rest of 2024 and have seen positive earnings estimate revisions in the last 30 days. Each of our picks carries a Zacks Rank #1 (Strong Buy) and has a Momentum Score of A. You can see the complete list of today’s Zacks #1 Rank stocks here.
Spotify Technology S.A. provides audio streaming services worldwide. SPOT operates through two segments, Premium and Ad-Supported. The Premium segment offers unlimited online and offline streaming access to its catalog of music and podcasts without commercial breaks to its subscribers.
The Ad-Supported segment provides on-demand online access to its catalog of music and unlimited online access to the catalog of podcasts to its subscribers on their computers, tablets, and compatible mobile devices. SPOT also offers sales, distribution and marketing, contract research and development, and customer support services.
Spotify Technology has an expected revenue and earnings growth rate of 19.4% and more than 100%, respectively, for the current year. The Zacks Consensus Estimate for current-quarter, next-quarter, current-year and next-year earnings has improved over the last 30 days.
Aspen Technology Inc.’s fiscal fourth-quarter results gained from continued momentum in the DGM and SSE segments. The integration efforts between the Heritage AspenTech, DGM and SSE businesses is an encouraging development. The DGM segment of AZPN saw nearly 40% year-over-year ACV growth driven by solid demand trends and improved funding.
Higher demand across the upstream market is aiding the AZPN’s SSE business. Strength in Utilities and Energy verticals bode well. AZPN reported an ACV of $968.3 million, marking a 9.4% year-over-year growth. This ACV performance does not include the $35.5 million ACV write-off stemming from the suspension of all commercial activities in Russia amid expanded sanctions.
Aspen Technology has an expected revenue and earnings growth rate of 5.5% and 12.8%, respectively, for the current year (ending June 2025). The Zacks Consensus Estimate for current-quarter, next-quarter, current-year and next-year earnings has improved over the last 30 days.
Maplebear Inc. is a grocery technology company principally in North America that works with grocers and retailers to transform how people shop. CART’s Instacart Platform offers retailers a suite of enterprise-grade technology products and services to power their e-commerce experiences, fulfill orders, digitize brick-and-mortar stores, provide advertising services, and glean insights. CART also operates virtual convenience stores; and provides software-as-a-service solutions to retailers.
Maplebear has an expected revenue and earnings growth rate of 11% and more than 100%, respectively, for the current year. The Zacks Consensus Estimate for current-quarter, next-quarter, current-year and next-year earnings has improved over the last 30 days.
Paramount Global operates as a media, streaming, and entertainment company worldwide. PARAA operates through TV Media, Direct-to-Consumer, and Filmed Entertainment segments. PARAA’s portfolio of consumer brands includes CBS, Showtime Networks, Paramount Pictures, Nickelodeon, MTV, Comedy Central, BET, Paramount, Pluto TV and Simon & Schuster, among others.
Paramount Global has an expected revenue and earnings growth rate of 0.2% and more than 100%, respectively, for the current year. The Zacks Consensus Estimate for current-quarter, next-quarter, current-year and next-year earnings has improved over the last 30 days.
Seagate Technology Holdings plc’s fourth-quarter performance was propelled by momentum in mass capacity solutions due to stronger nearline cloud demand. These factors are expected to drive STX’s top-line growth in the current quarter. Mass Capacity exabyte shipments constitute more than 90% of total exabyte shipments. Pricing initiatives and a favorable product mix are aiding margin performance.
STX’s launch of Mozaic 3+ hard drive platform positions it well to benefit from megatrends like AI and machine learning. This is expected to boost demand for mass-capacity storage solutions over the long term. STX expects to complete the qualification with a lead CSP customer and initiate several cloud-customer qualifications in the current quarter.
Seagate Technology has an expected revenue and earnings growth rate of 42.8% and more than 100%, respectively, for the current year (ending June 2025). The Zacks Consensus Estimate for current-quarter, next-quarter, current-year and next-year earnings has improved over the last seven days.
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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Zacks Investment Research
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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.