Friday, February 7, 2025

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 Uber Technologies, Inc. (UBER), Comcast Corp. (CMCSA) and Gilead Sciences, Inc. (GILD), as well as a micro-cap stock Onfolio Holdings, Inc. (ONFO). 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 >>>

Ahead of Wall Street

The daily 'Ahead of Wall Street' article is a must-read for all investors who would like to be ready for that day's trading action. The article comes out before the market opens and attempts to make sense of that morning's economic releases and how they will affect that day's market action. You can read this article for free on our home page and can actually sign up there to get an email notification as this article comes out each morning.

You can read today's AWS here >>> BLS Jobs Numbers +143K, Unemployment Rate +4.0%

Today's Featured Research Reports

Shares of Uber have gained +1.4% over the past six months against the Zacks Internet - Services industry’s gain of +13.3%. The company’s delivery business benefits from robust online order volumes. The company’s efforts to expand its delivery operations through successive acquisitions are encouraging. Continued recovery in Mobility operations is also aiding the company.

Apart from the recovery in Mobility operations and solid performance of the Delivery unit, Uber's focus on financial discipline is encouraging as well. For first-quarter 2025, adjusted EBITDA is estimated between $1.79 billion and $1.89 billion.

Despite the positives, the Zacks analyst advise investors not to buy Uber now as it continues to witness high costs and expenses, owing to a rise in sales and marketing expenses and cost of revenues. High debt levels are bothersome as well. We advise investors to wait for a better entry point. Our thesis is supported by our Neutral recommendation on the shares.

(You can read the full research report on Uber here >>>)

Comcast’s shares have underperformed the Zacks Cable Television industry over the past year (-13.8% vs. -7.6%). The company persistently suffers from video-subscriber attrition due to cord-cutting. Broadband prospects are suffering from increased competition from fixed wireless and fiber businesses. Additionally, a leveraged balance sheet is a major concern.

Nevertheless, Comcast benefited from growing domestic wireless subscribers in the fourth quarter. The company’s plan to transition to DOCSIS 4.0 holds promise. The technology will expand it much faster and at a lower cost compared with its competitors. Decreasing marketing and promotional expenses bode well for CMCSA's profitability.

Its streaming service, Peacock, is a key catalyst in driving broadband sales. Recovery in the theme park and movie business bodes well for bottom line growth. Strong free cash flow generation ability is noteworthy.

(You can read the full research report on Comcast here >>>)

Shares of Gilead have outperformed the Zacks Medical - Biomedical and Genetics industry over the past year (+38.2% vs. -7.0%). The company’s flagship HIV therapy, Biktarvy, continues to maintain its strong growth, fueling the top line. The company’s efforts to develop better HIV treatments are commendable. Recent data validate lenacapavir’s potential to prevent HIV.

The successful development and approval of lenacapavir for the prevention of HIV should be a significant boost for Gilead, given its advantages over existing treatments. Strong quarterly results and encouraging data on lenacapavir data.

According to the Zacks analyst estimates sales for Biktarvy indicate a CAGR of around 5.8% over the next three years. Gilead's efforts to bolster its oncology and virology franchises through internal pipeline development and collaborations are impressive as well. However, recent pipeline setbacks weigh on the stock.

(You can read the full research report on Gilead here >>>)

Onfolio’s shares have outperformed the Zacks Internet - Commerce industry over the past year (+164.5% vs. +38.5%). This microcap company with market capitalization of $6.51 million have seen revenues jumped 53% year over year, driven by acquisitions like RevenueZen and DDS Rank. Operational efficiency improved, with cash burn declining 68% year over year.

The Eastern Standard acquisition boosted digital marketing. Intangible assets grew 31% year over year, supporting recurring revenues. Operating in high-growth digital sectors, Onfolio benefits from regulatory exemptions and a flexible capital structure for M&A.

However, net losses reached $1.91 million in the first nine months of 2024, with rising selling, general and administrative expenses pressuring margins. Liquidity remains tight, with cash declining 63% year to date and debt rising to $4.39 million. High amortization and impairment risks threaten earnings, while weak organic growth and potential compliance costs post-emerging growth status add concerns.

(You can read the full research report on Onfolio here >>>)

Other noteworthy reports we are featuring today include Northrop Grumman Corp. (NOC), Ross Stores, Inc. (ROST) and Robinhood Markets, Inc. (HOOD).

Mark Vickery
Senior Editor

Note: Sheraz Mian heads the Zacks Equity Research department and is a well-regarded expert of aggregate earnings. He is frequently quoted in the print and electronic media and publishes the weekly Earnings Trends and Earnings Preview reports. If you want an email notification each time Sheraz publishes a new article, please click here>>>

Today's Must Read

Uber (UBER) Rides on Delivery Business Amid Rising Expenses

Domestic Wireless Subscriber Gain Benefits Comcast (CMCSA)

HIV Franchise Fuel Gilead (GILD) Amid Pipeline Setbacks

Featured Reports

Solid Demand Aids Northrop (NOC), Labor Shortage Poses Risk
Per the Zacks analyst, strong global demand for its products like Triton and E-2D Advanced Hawkeyes steadily boosts Northrop. Yet shortage of skilled labor might hurt the stock.

Ross Stores (ROST) Gains From Store Expansion & Other Plans
Per the Zacks analyst, Ross Stores is doing well with the execution of its store-expansion plans. The company has also been benefiting from customer response for its merchandise across the banners.

Cognizant (CTSH) Rides on Acquisitions, Strong Partner Base
Per the Zacks analyst, Cognizant is benefiting from accretive acquisitions. A strong partner base has been helping it to expand its clientele.

Solid Retirement Unit Aids Prudential (PRU), Expenses Hurt
Per the Zacks Analyst, Prudential's solid retirement business has generated substantial premiums, which in turn drove the top line. However, elevated expenses remain a major concern.

Cost Cuts, Acquisitions to Aid Eastman Chemical (EMN)
While the company faces headwinds from lower demand across certain markets, it will gain from cost-cutting actions and synergies of acquisitions, per the Zacks analyst.

Investments & Customer Additions Aid UGI Corporation (UGI)
Per the Zacks analyst, UGI's strategic investment plans help to upgrade and replace the aging infrastructure that boost its performance. The company also gains from an expanding customer base.

Patterson-UTI (PTEN) to Gain from Advancing Rig Technology
The Zacks analyst believes that Patterson-UTI's investment in its Apex Tier-1 drilling rigs and automation systems enhances efficiency but is worried over declining revenue and profitability.

New Upgrades

Buyouts, Rate Cuts & Product Expansion Aid Robinhood (HOOD)
Per the Zacks analyst, interest rate cuts, strategic buyouts such as TradePMR and Bitstamp, product diversification efforts, and a solid balance sheet will likely support Robinhood's financials.

Lumen (LUMN) Gains from Momentum in Quantum Fiber & AI Deals
Per the Zacks analyst, Lumen's performance is gaining from higher demand for its PCF solutions amid AI proliferation and traction in Quantum Fiber. It secured $8.5 billion in PCF deals in 2024.

InterDigital (IDCC) Rides on Healthy Demand, Portfolio Strength
Per the Zacks analyst, rising demand for InterDigital's comprehensive patent portfolio in the consumer electronics and IoT market will likely drive its top line.

New Downgrades

Weakness in North America Segment to Hurt A. O. Smith (AOS)
Per the Zacks analyst, A. O. Smith is experiencing softness in the North America unit, due to a decline in orders for residential and commercial water heater products. Forex woes are an added concern.

CVS Health (CVS) Hurt by Utilization Pressure, Macro Woes
The Zacks analyst is concerned with CVS Health's Health Care Benefits segment facing headwinds from ongoing elevated utilization levels. Rising costs from economic volatilities add to the worry.

Cracker Barrel (CBRL) Hurt By Dismal Comps & High Costs
Per the Zacks analyst, declining guest traffic hurts Cracker Barrel's comps. Higher labor costs due to increased wages and investments in additional labor hours might keep profits under pressure.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Northrop Grumman Corporation (NOC) : Free Stock Analysis Report

Comcast Corporation (CMCSA) : Free Stock Analysis Report

Gilead Sciences, Inc. (GILD) : Free Stock Analysis Report

Ross Stores, Inc. (ROST) : Free Stock Analysis Report

Uber Technologies, Inc. (UBER) : Free Stock Analysis Report

Robinhood Markets, Inc. (HOOD) : Free Stock Analysis Report

Onfolio Holdings Inc. (ONFO): Free Stock Analysis Report

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