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AeroVironment, Meredith, Oracle and FedEx highlighted as Zacks Bull and Bear of the Day
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For Immediate Release
Chicago, IL – September 18, 2018 – Zacks Equity Research highlights AeroVironment Inc. (AVAV - Free Report) as the Bull of the Day, Meredith Corporation as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Oracle (ORCL - Free Report) and FedEx (FDX - Free Report) .
Headquartered in Monrovia, CA, AeroVironment Inc. is a company known for its Unmanned Aircraft Systems (better known as drones). It focuses primarily on the design and development of these systems, as well as tactical missile systems that provide situational awareness, multi-band communications, force protection and other mission effects. AeroVironment supplies its drones to the U.S. Department of Defense, including the U.S. Army, Marine Corps, Special Operations Command, Air Force, and Navy.
The company recently sold off its electric charger division for $32 billion to Webasto Group, a move that allows it to focus completely on its various drone applications.
AeroVironment’s recent first quarter was a strong one, with results blowing straight past estimates. Sales surged 127% year-over-year to $78 million, and gross profit margins on those sales nearly doubled, hitting 42% and up from 25% in the year-ago period.
Earnings of 85 cents per diluted share easily beat the Zacks Consensus thanks to a beneficial litigation settlement that added 26 cents to the company’s bottom line.
Additionally, AeroVironment noted that backlog, which will eventually turn into revenues as the year goes on, more than doubled by the end of Q1 to $157 million; backlog was only around $70 million a year ago.
In the earnings release, president and chief executive officer Wahid Nawabi said “With the divestiture of our Efficient Energy Systems business, we have transformed AeroVironment into a future-defining technologies solution provider serving large and growing global defense, telecommunications and commercial markets. Strength in the end markets for our small UAS and Tactical Missile Systems, combined with continued progress in our HAPSMobile, Inc. joint venture, position us well to achieve our fiscal year 2019 objectives and our long-term value creation goals.”
Meredith Corporation is a media and marketing services company based in Des Moines, IA. The company has two operating segments: National Media and Local Media. As of this year, Meredith is the largest magazine company in the world, and some of its biggest brands include People, Sports Illustrated, InStyle, Better Homes & Gardens, Magnolia Journal, Health, Entertainment Weekly, Cooking Light, and Travel + Leisure, among many others.
Just recently, co-founder of Salesforce.com Marc Benioff and his wife Lynne announced they are purchasing one of Meredith’s top publications, Time magazine, for $190 million. The proposed sale is expected to close within 30 days and will be unrelated to Salesforce.
Shares of MDP have experienced downturn lately, falling over 19% year-to-date, and mixed results in Meredith’s fourth-quarter earnings report added to the stock’s woes.
Looking at Meredith’s Q4 report a little deeper, the publishing company posted adjusted earnings of 69 cents, missing the Zacks Consensus and falling 35.5% year-over-year.
Even with this earnings miss, Meredith’s revenue performance was strong last quarter. Total revenues of $788.1 million came in line with our consensus, and jumped 76.9% from the prior-year period. Advertising revenues grew 63% and circulation revenues more than doubled.
Additionally, People.com was a huge digital driver, generating record traffic.
In its earnings release, President and CEO Tom Harty said "Given the progress made on synergy achievement and asset divestitures, we expect to achieve our goals of reducing debt by $1 billion by the end of fiscal 2019 and generating $1 billion of adjusted EBITDA in fiscal 2020, meaningfully contributing to total shareholder return.”
Despite these revenue numbers, analysts were not impressed, and many lowered their estimates for 2019; the current consensus has fallen well over two dollars from $5.84 to $3.12 in the last 60 days. The outlook for 2020 has fallen as well, down 89 cents during the same time period.
MDP is now a #5 (Strong Sell) on the Zacks Rank.
Meredith remains positive on the Time Inc. properties it gained—the buyout was completed during the quarter—and expects a solid year for political advertising; political advertising revenues at its television stations are projected to be in the band of $55-$65 million for the current fiscal year.
Going forward, management expects Q1 earnings from continuing operation in the range of $2 million and $10 million, and expects adjusted EBITDA to be in the band of $122-$127 million. The effective tax rate for the quarter is forecasted to be 28%.
Additional content:
Oracle, FedEx Post Mixed Earnings Reports
After the closing bell this Monday, and separated by weeks on either side by the bulk of normal earnings seasons, tech major Oracle posted mixed results in its fiscal Q1 2019: 71 cents per share was a 3-cent positive surprise from the consensus, but revenues of $9.20 billion missed the $9.29 billion Zacks analysts had been looking for. This top-line result was also basically flat from Oracle's revenue total in the year-ago quarter.
On the earnings side, it's been a full two years since Oracle missed estimates on the bottom line. The company also plans a massive 12 billion share buyback program. However, this hasn't been enough to keep ORCL shares from sliding 5% in after-hours trading. For more on ORCL's earnings, click here.
Transportation and logistics giant FedEx also posted fiscal Q1 2019 earnings results this afternoon, also mixed compared to estimates: $3.10 per share was well below the $3.78 in the Zacks consensus, while revenues in the quarter of $17.1 billion beat the $16.88 billion analysts had been looking for. However, FedEx rose its full-year guidance by 20 cents on both top and bottom ends of the range, to $15.88 - $16.45 per share. This is the fourth quarter in the past eight where FedEx has come up short on bottom-line estimates. Shares are trading down roughly 2.5% in after-hours trading.
Best Electric Car Stock? You'll Never Guess It.
Zacks Research has released a report that may shock many investors. One stock stands out as the best way to invest in the surge to electric cars. And it's not the one you may think!
Much like petroleum 150 years ago, lithium battery power is set to shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge. With battery prices plummeting and charging stations set to multiply, revenues that were already at $31 billion in 2016 are expected to blast to over $67 billion by the end of 2022.
Every day, the analysts at Zacks Equity Research select two stocks that are likely to outperform (Bull) or underperform (Bear) the markets over the next 3-6 months.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous analyst coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year. See these high-potential stocks free >>.
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
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/performance for information about the performance numbers displayed in this press release.
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AeroVironment, Meredith, Oracle and FedEx highlighted as Zacks Bull and Bear of the Day
For Immediate Release
Chicago, IL – September 18, 2018 – Zacks Equity Research highlights AeroVironment Inc. (AVAV - Free Report) as the Bull of the Day, Meredith Corporation as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Oracle (ORCL - Free Report) and FedEx (FDX - Free Report) .
Here is a synopsis of all four stocks:
Bull of the Day:
Headquartered in Monrovia, CA, AeroVironment Inc. is a company known for its Unmanned Aircraft Systems (better known as drones). It focuses primarily on the design and development of these systems, as well as tactical missile systems that provide situational awareness, multi-band communications, force protection and other mission effects. AeroVironment supplies its drones to the U.S. Department of Defense, including the U.S. Army, Marine Corps, Special Operations Command, Air Force, and Navy.
The company recently sold off its electric charger division for $32 billion to Webasto Group, a move that allows it to focus completely on its various drone applications.
AeroVironment’s recent first quarter was a strong one, with results blowing straight past estimates. Sales surged 127% year-over-year to $78 million, and gross profit margins on those sales nearly doubled, hitting 42% and up from 25% in the year-ago period.
Earnings of 85 cents per diluted share easily beat the Zacks Consensus thanks to a beneficial litigation settlement that added 26 cents to the company’s bottom line.
Additionally, AeroVironment noted that backlog, which will eventually turn into revenues as the year goes on, more than doubled by the end of Q1 to $157 million; backlog was only around $70 million a year ago.
In the earnings release, president and chief executive officer Wahid Nawabi said “With the divestiture of our Efficient Energy Systems business, we have transformed AeroVironment into a future-defining technologies solution provider serving large and growing global defense, telecommunications and commercial markets. Strength in the end markets for our small UAS and Tactical Missile Systems, combined with continued progress in our HAPSMobile, Inc. joint venture, position us well to achieve our fiscal year 2019 objectives and our long-term value creation goals.”
Bear of the Day:
Meredith Corporation is a media and marketing services company based in Des Moines, IA. The company has two operating segments: National Media and Local Media. As of this year, Meredith is the largest magazine company in the world, and some of its biggest brands include People, Sports Illustrated, InStyle, Better Homes & Gardens, Magnolia Journal, Health, Entertainment Weekly, Cooking Light, and Travel + Leisure, among many others.
Just recently, co-founder of Salesforce.com Marc Benioff and his wife Lynne announced they are purchasing one of Meredith’s top publications, Time magazine, for $190 million. The proposed sale is expected to close within 30 days and will be unrelated to Salesforce.
Shares of MDP have experienced downturn lately, falling over 19% year-to-date, and mixed results in Meredith’s fourth-quarter earnings report added to the stock’s woes.
Looking at Meredith’s Q4 report a little deeper, the publishing company posted adjusted earnings of 69 cents, missing the Zacks Consensus and falling 35.5% year-over-year.
Even with this earnings miss, Meredith’s revenue performance was strong last quarter. Total revenues of $788.1 million came in line with our consensus, and jumped 76.9% from the prior-year period. Advertising revenues grew 63% and circulation revenues more than doubled.
Additionally, People.com was a huge digital driver, generating record traffic.
In its earnings release, President and CEO Tom Harty said "Given the progress made on synergy achievement and asset divestitures, we expect to achieve our goals of reducing debt by $1 billion by the end of fiscal 2019 and generating $1 billion of adjusted EBITDA in fiscal 2020, meaningfully contributing to total shareholder return.”
Despite these revenue numbers, analysts were not impressed, and many lowered their estimates for 2019; the current consensus has fallen well over two dollars from $5.84 to $3.12 in the last 60 days. The outlook for 2020 has fallen as well, down 89 cents during the same time period.
MDP is now a #5 (Strong Sell) on the Zacks Rank.
Meredith remains positive on the Time Inc. properties it gained—the buyout was completed during the quarter—and expects a solid year for political advertising; political advertising revenues at its television stations are projected to be in the band of $55-$65 million for the current fiscal year.
Going forward, management expects Q1 earnings from continuing operation in the range of $2 million and $10 million, and expects adjusted EBITDA to be in the band of $122-$127 million. The effective tax rate for the quarter is forecasted to be 28%.
Additional content:
Oracle, FedEx Post Mixed Earnings Reports
After the closing bell this Monday, and separated by weeks on either side by the bulk of normal earnings seasons, tech major Oracle posted mixed results in its fiscal Q1 2019: 71 cents per share was a 3-cent positive surprise from the consensus, but revenues of $9.20 billion missed the $9.29 billion Zacks analysts had been looking for. This top-line result was also basically flat from Oracle's revenue total in the year-ago quarter.
On the earnings side, it's been a full two years since Oracle missed estimates on the bottom line. The company also plans a massive 12 billion share buyback program. However, this hasn't been enough to keep ORCL shares from sliding 5% in after-hours trading. For more on ORCL's earnings, click here.
Transportation and logistics giant FedEx also posted fiscal Q1 2019 earnings results this afternoon, also mixed compared to estimates: $3.10 per share was well below the $3.78 in the Zacks consensus, while revenues in the quarter of $17.1 billion beat the $16.88 billion analysts had been looking for. However, FedEx rose its full-year guidance by 20 cents on both top and bottom ends of the range, to $15.88 - $16.45 per share. This is the fourth quarter in the past eight where FedEx has come up short on bottom-line estimates. Shares are trading down roughly 2.5% in after-hours trading.
Best Electric Car Stock? You'll Never Guess It.
Zacks Research has released a report that may shock many investors. One stock stands out as the best way to invest in the surge to electric cars. And it's not the one you may think!
Much like petroleum 150 years ago, lithium battery power is set to shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge. With battery prices plummeting and charging stations set to multiply, revenues that were already at $31 billion in 2016 are expected to blast to over $67 billion by the end of 2022.
See Zacks Best EV Stock Free >>
Get today’s Zacks #1 Stock of the Day with your free subscription to Profit from the Pros newsletter:
About the Bull and Bear of the Day
Every day, the analysts at Zacks Equity Research select two stocks that are likely to outperform (Bull) or underperform (Bear) the markets over the next 3-6 months.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous analyst coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year. See these high-potential stocks free >>.
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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/performance for information about the performance numbers displayed in this press release.