Tuesday, February 13, 2024

The Zacks Research Daily presents the best research output of our analyst team. Today's Research Daily features a real-time update on the ongoing Q4 earnings season, in addition to fresh analyst reports on 16 major stocks, including NIKE, Inc. (NKE), Airbnb, Inc. (ABNB) and CVS Health Corporation (CVS). 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 >>>

Q4 Earnings Seaosn Scorecard

Including all of this morning's results, we now have Q4 results from 351 S&P 500 members or 70.2% of the index's total membership. Total earnings for these companies are up +5.6% from the same period last year on +3.7% higher revenues, with 79.5% beating EPS estimates and 64.7% beating revenue estimates.

As we have noted all along in our earnings commentaries, the Q4 earnings and revenue growth rates represent an acceleration relative to what we have been seeing from this group of index members in other recent periods. The EPS beats percentages are roughly in-line with historical averages, though the revenue beats percentage is tracking towards the lower end of the range over the preceding 20-quarter period.

Looking at Q4 as a whole, combining the actual resutls for the 351 index members with estimates for the still-to-come companies, total earnings are on track to be up +5.5% on +3.2% higher revenues.

The Tech and Energy sectors are driving the Q4 growth pace in opposite directions, with the Energy sector dragging it down and the Tech sector giving it a boost. Excluding the Tech sector's contribution, Q4 earnings for the rest of the index would be down -1.7% instead of up +5.5% as a whole.

Today's Featured Analyst Reports 

NIKE shares have modestly done better than the Zacks Shoes and Retail Apparel industry over the last six months (-0.4% vs. -5.7%). The Zacks analyst believes that continued progress on consumer direct acceleration strategy, compelling product innovation and digital leadership have driven the company’s business. Robust consumer trends, including momentum in the NIKE mobile app led by improved traffic and increased member buying frequency have aided the digital segment.

However, inflationary pressure and elevated expenses have been major headwinds.

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

Airbnb shares have outperformed the Zacks Internet - Content industry over the past year (+27.3% vs. +19.8%). The Zacks analyst believes that improvement in booked Nights and Experiences, increasing guest demand and continuous recovery from the pandemic years in cross-border travel are benefitting the company. Strength in active listings owing to supply growth across Asia Pacific and Latin America have also aided.

Yet, great volatility in travel demand due to macroeconomic uncertainties, rising competition and impacts of geopolitical conflicts remain major concerns.

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

Shares of CVS Health have outperformed the Zacks Retail - Pharmacies and Drug Stores industry over the past six months (+4.0% vs. -3.1%). Per the Zacks analyst, strong sales momentum across all three operating segments have been helping the company’s topline. New acquisitions and fresh launches like Cordavis are also likely to boost future growth.

However, decline in COVID-19 vaccinations and testing sales and persistent pharmacy reimbursement headwinds continue to impact business performance.

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

Other noteworthy reports we are featuring today include ONEOK, Inc. (OKE), Imperial Oil Limited (IMO) and Arch Capital Group Ltd. (ACGL).

Director of Research

Sheraz Mian

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>>>