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Qorvo, Blue Bird Corp, Uber, Just Eat Takeaway and DoorDash highlighted as Zacks Bull and Bear of the Day
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For Immediate Release
Chicago, IL – September 27, 2021 – Zacks Equity Research Shares of Qorvo, Inc. (QRVO - Free Report) as the Bull of the Day, Blue Bird Corporation (BLBD - Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Uber Technologies, Inc. (UBER - Free Report) , Just Eat Takeaway.com N.V. and DoorDash, Inc. (DASH - Free Report) .
Qorvo is a chip powerhouse striving to digitally connect the world. The global pandemic has forced society online, and today we are more digitally connected than ever before through mobile devices powered by Qorvo's innovative chip technology.
The commencing 4th Industrial Revolution is connecting everything & everyone around us. The pandemic's accelerated digitalizing impact has kick-started a paradigm shift in the economy that positions the semiconductor market to explode through the roaring 20s. Society's growing penchant for advanced technology has made Qorvo and its best-in-class connectivity chips more valuable than ever before.
QRVO is trading about 50% above its pre-pandemic levels but has consolidated since 2021 began, with a valuation compressing sideways trade for nearly 3 quarters (earnings growing while its share price remains constant). After bouncing off a key support level in oversold territory amid last Monday's sell-off (9/20), the stock looks primed to breakout.
QRVO is now trading at its lowest forward P/E multiple since the Great Capitulation last March. There appears to be a renewed bid for semiconductor stocks following a 9-month lull as investors look towards the future of this technological backbone, and it's about time we all increase our exposure to this underappreciated space.
Analysts have raised their EPS estimates on QRVO, propelling it into a Zacks Rank #1 (Strong Buy).
The Business
Qorvo has a diverse portfolio of chips that fall into two categories: Mobile Products (MP) and Infrastructure & Defense Products (IDP). Its MP segments include chips for smartphones, wearables, laptops, tablets, and internet of things (IoT) devices. MP is the company's primary growth driver, with Apple's illustrious iPhone and the 5G 'super-cycle' being the crown jewel.
IDP enables technologies such as wireless infrastructure, defense, Wi-Fi, smart homes, advanced automobiles, and IoT. This division is a much more volatile revenue driver as it is typically project-based. Nevertheless, with the $3.5 trillion US infrastructure bill in the works and a supplementary chip-focus spending proposal, I suspect this segment will get another boost in the coming quarters.
Qorvo is a radio frequency (RF) technology leader: the driving force behind the 5G revolution, catalyzing the demand for the newest mobile devices along with the nascent IoT space. This next generation of mobile connectivity is anticipated to connect everything around us. Smart cities are on the horizon, and Qorvo's next-generation chips are going to be integral in its build-out.
The RF solutions market is expected to explode over the next 5 years as the 5G technology rolls out. The RF market is estimated to expand at a compounded annual growth rate (CAGR) of 14%, reaching $45 billion by 2025, according to Grand View Research.
We are only at the dawn of the 5G revolution. This technology is just beginning to take hold of the mobile world, and its implications are beginning to ripple across all sectors. Qorvo is well-positioned to heavily profit from this exciting industry's rapid growth.
Qorvo's cutting-edge RF chips are being utilized in Apple's first 5G iPhone (the iPhone 12), and demand is expected to be enormous. Over 100 million iPhone 12 had been sold as of Q2 in this record 5G-fueled iPhone super-cycle. The iPhone 13 has just been unveiled, which should propel another wave of demand for this now ubiquitous smartphone. Qorvo ultra-wideband chip technology is at the core of these new devices, providing them with best-in-class functionality.
QRVO Technical Levels
QRVO is trading 13.5% off its all-time highs, which it reached last month, and just bounced off a critical support level at around $168 a share in oversold RSI territory.
After testing and rebounding off that support last Monday (9/20), these shares look prepped to break out at their currently underappreciated level. Still, we will likely face some resistance at its 200-day moving average (around $180), which this equity recently dipped below for the first time since April 2020.
The best time to start a position in a high potential stock is when it's down, and right now, QRVO is decidedly down.
Final Thoughts
With the recent spike in market volatility and FUD (fear, uncertainty, & doubt) growing daily in this pivotal late-cycle market period, many are apprehensive about buying anything. But remember the old Warren Buffett proverb, "be greedy when others are fearful."
I can't promise that QRVO doesn't have choppy waters ahead (at least in the short run). However, I am confident that this chip powerhouse will play a critical role in the budding 5G Revolution. 13 out of 17 analysts are calling these shares a buy today with no sell ratings. QRVO currently sits 23% below its average price target of $214 a share and 44% below its more bullish target of $250. QRVO is a stock to hold for your portfolio of the future.
Blue Bird Corp. is a historic maker of school buses and it’s expanded its offerings to include alternative fuel and EV buses. The stock went on a huge run after the vaccine announcement last fall as Wall Street cheered the likelihood schools would reopen soon.
Most U.S. schools are back in person and the company could rebound in the next few years. However, its near-term outlook is hardly strong and its stock is down 25% in the last three months.
Blue Bird Basics
Blue Bird is a leading independent designer and manufacturer of school buses, with roughly 180,000 buses in operation today. The company is rather stable and has remained a staple in American school districts for decades.
BLBD’s sales had grown over the last several years before they slipped marginally in FY19 and then dropped 14% in fiscal 2020 (period ended Oct. 3, 2020), as the entire education world was turned upside down.
Zacks estimates call for its fiscal 2021 revenue to fall another 17% to $730 million, with its adjusted earnings projected to sink 51% to $0.40 a share. Luckily, the company is projected to bounce back in 2022, with its EPS expected to surge 75% above our current year projection on 11% higher sales.
Bottom Line
Despite the expected progress, Blue Bird’s earnings revisions have trended in the wrong direction to help it land a Zacks Rank #5 (Strong Sell) at the moment, alongside its “D” grades for Value and Momentum and an “F” for Growth in our Style Score system.
On top of that, its Automotive – Domestic industry is near the bottom quarter of over 250 Zacks industries. And the nearby chart showcases that Blue Bird stock has significantly underperformed its industry in the past three years, while falling 19%.
The Macon, Georgia company is set to bounce back as life and schools return to normal. The firm could also benefit as it sells more electric school buses and more districts slowly revamp their fleets as part of a broader green push.
All that said, investors might want to stay away from BLBD stock for now, or at least until it shows signs of a more prolonged comeback.
Additional content:
Delivery Workers in NYC to See Improved Conditions
Uber delivery workers in New York are expected to soon get minimum pay and see improved working conditions as lawmakers pass a sweeping legislation to regulate the delivery industry. The move, which recognizes the efforts of delivery workers to meet the spike in demand during the pandemic and the challenging conditions through which they carried out deliveries during the floods caused by Hurricane Ida, concerns Grubhub, owned by Just Eat Takeaway and DoorDash, which dominate the industry apart from Uber. While Uber and DoorDash carry a Zacks Rank #3 (Hold), Just Eat Takeaway.com carries a Zacks Rank #4 (Sell).
Some of the protections offered in the series of bills passed on Thursday include the ability of workers to set the maximum distance they are willing to travel per trip, the option to not accept trips over bridges or in tunnels, the companies disclosing gratuity policies to workers, and restaurants allowing couriers to use their bathrooms when a delivery is being picked up.
The bills prohibit food delivery apps from charging couriers for the payment of their wages, and they must pay delivery workers at least once a week. In order to determine the minimum payment required per trip, the Department of Consumer and Worker Protection is required to conduct a study on food delivery workers.
While Uber has not yet commented, a CNBC report quoted a DoorDash spokesperson saying, “We recognize the unique challenges facing delivery workers in New York City and share the goal of identifying policies that will help Dashers and workers like them.” The spokesperson added, “We will continue to work with all stakeholders, including the City Council, to identify ways to support all delivery workers in New York City without unintended consequences.”
Supporting the bills, a Grubhub spokesperson, Grant Klinzman, told CNBC, “These bills are common-sense steps to support the delivery workers who work hard every day for New York’s restaurants and residents.” Klinzman added, “Ensuring they receive a living wage and have access to restrooms isn’t just a good idea - it’s the right thing to do.”
Efforts have been ongoing to protect gig workers and offer them more benefits. Last month, a California court ruled that Proposition 22 (Prop 22), a ballot initiative that allowed gig companies, including Uber, to retain the independent contractor status for their drivers, was unconstitutional. While retaining the independent contractor status, Prop 22 provides workers with a number of benefits, including a certain amount of guaranteed earnings, a healthcare stipend and accident insurance for on-the-job injuries.
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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Qorvo, Blue Bird Corp, Uber, Just Eat Takeaway and DoorDash highlighted as Zacks Bull and Bear of the Day
For Immediate Release
Chicago, IL – September 27, 2021 – Zacks Equity Research Shares of Qorvo, Inc. (QRVO - Free Report) as the Bull of the Day, Blue Bird Corporation (BLBD - Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Uber Technologies, Inc. (UBER - Free Report) , Just Eat Takeaway.com N.V. and DoorDash, Inc. (DASH - Free Report) .
Here is a synopsis of all five stocks:
Bull of the Day:
Qorvo is a chip powerhouse striving to digitally connect the world. The global pandemic has forced society online, and today we are more digitally connected than ever before through mobile devices powered by Qorvo's innovative chip technology.
The commencing 4th Industrial Revolution is connecting everything & everyone around us. The pandemic's accelerated digitalizing impact has kick-started a paradigm shift in the economy that positions the semiconductor market to explode through the roaring 20s. Society's growing penchant for advanced technology has made Qorvo and its best-in-class connectivity chips more valuable than ever before.
QRVO is trading about 50% above its pre-pandemic levels but has consolidated since 2021 began, with a valuation compressing sideways trade for nearly 3 quarters (earnings growing while its share price remains constant). After bouncing off a key support level in oversold territory amid last Monday's sell-off (9/20), the stock looks primed to breakout.
QRVO is now trading at its lowest forward P/E multiple since the Great Capitulation last March. There appears to be a renewed bid for semiconductor stocks following a 9-month lull as investors look towards the future of this technological backbone, and it's about time we all increase our exposure to this underappreciated space.
Analysts have raised their EPS estimates on QRVO, propelling it into a Zacks Rank #1 (Strong Buy).
The Business
Qorvo has a diverse portfolio of chips that fall into two categories: Mobile Products (MP) and Infrastructure & Defense Products (IDP). Its MP segments include chips for smartphones, wearables, laptops, tablets, and internet of things (IoT) devices. MP is the company's primary growth driver, with Apple's illustrious iPhone and the 5G 'super-cycle' being the crown jewel.
IDP enables technologies such as wireless infrastructure, defense, Wi-Fi, smart homes, advanced automobiles, and IoT. This division is a much more volatile revenue driver as it is typically project-based. Nevertheless, with the $3.5 trillion US infrastructure bill in the works and a supplementary chip-focus spending proposal, I suspect this segment will get another boost in the coming quarters.
Qorvo is a radio frequency (RF) technology leader: the driving force behind the 5G revolution, catalyzing the demand for the newest mobile devices along with the nascent IoT space. This next generation of mobile connectivity is anticipated to connect everything around us. Smart cities are on the horizon, and Qorvo's next-generation chips are going to be integral in its build-out.
The RF solutions market is expected to explode over the next 5 years as the 5G technology rolls out. The RF market is estimated to expand at a compounded annual growth rate (CAGR) of 14%, reaching $45 billion by 2025, according to Grand View Research.
We are only at the dawn of the 5G revolution. This technology is just beginning to take hold of the mobile world, and its implications are beginning to ripple across all sectors. Qorvo is well-positioned to heavily profit from this exciting industry's rapid growth.
Qorvo's cutting-edge RF chips are being utilized in Apple's first 5G iPhone (the iPhone 12), and demand is expected to be enormous. Over 100 million iPhone 12 had been sold as of Q2 in this record 5G-fueled iPhone super-cycle. The iPhone 13 has just been unveiled, which should propel another wave of demand for this now ubiquitous smartphone. Qorvo ultra-wideband chip technology is at the core of these new devices, providing them with best-in-class functionality.
QRVO Technical Levels
QRVO is trading 13.5% off its all-time highs, which it reached last month, and just bounced off a critical support level at around $168 a share in oversold RSI territory.
After testing and rebounding off that support last Monday (9/20), these shares look prepped to break out at their currently underappreciated level. Still, we will likely face some resistance at its 200-day moving average (around $180), which this equity recently dipped below for the first time since April 2020.
The best time to start a position in a high potential stock is when it's down, and right now, QRVO is decidedly down.
Final Thoughts
With the recent spike in market volatility and FUD (fear, uncertainty, & doubt) growing daily in this pivotal late-cycle market period, many are apprehensive about buying anything. But remember the old Warren Buffett proverb, "be greedy when others are fearful."
I can't promise that QRVO doesn't have choppy waters ahead (at least in the short run). However, I am confident that this chip powerhouse will play a critical role in the budding 5G Revolution. 13 out of 17 analysts are calling these shares a buy today with no sell ratings. QRVO currently sits 23% below its average price target of $214 a share and 44% below its more bullish target of $250. QRVO is a stock to hold for your portfolio of the future.
Bear of the Day:
Blue Bird Corp. is a historic maker of school buses and it’s expanded its offerings to include alternative fuel and EV buses. The stock went on a huge run after the vaccine announcement last fall as Wall Street cheered the likelihood schools would reopen soon.
Most U.S. schools are back in person and the company could rebound in the next few years. However, its near-term outlook is hardly strong and its stock is down 25% in the last three months.
Blue Bird Basics
Blue Bird is a leading independent designer and manufacturer of school buses, with roughly 180,000 buses in operation today. The company is rather stable and has remained a staple in American school districts for decades.
BLBD’s sales had grown over the last several years before they slipped marginally in FY19 and then dropped 14% in fiscal 2020 (period ended Oct. 3, 2020), as the entire education world was turned upside down.
Zacks estimates call for its fiscal 2021 revenue to fall another 17% to $730 million, with its adjusted earnings projected to sink 51% to $0.40 a share. Luckily, the company is projected to bounce back in 2022, with its EPS expected to surge 75% above our current year projection on 11% higher sales.
Bottom Line
Despite the expected progress, Blue Bird’s earnings revisions have trended in the wrong direction to help it land a Zacks Rank #5 (Strong Sell) at the moment, alongside its “D” grades for Value and Momentum and an “F” for Growth in our Style Score system.
On top of that, its Automotive – Domestic industry is near the bottom quarter of over 250 Zacks industries. And the nearby chart showcases that Blue Bird stock has significantly underperformed its industry in the past three years, while falling 19%.
The Macon, Georgia company is set to bounce back as life and schools return to normal. The firm could also benefit as it sells more electric school buses and more districts slowly revamp their fleets as part of a broader green push.
All that said, investors might want to stay away from BLBD stock for now, or at least until it shows signs of a more prolonged comeback.
Additional content:
Delivery Workers in NYC to See Improved Conditions
Uber delivery workers in New York are expected to soon get minimum pay and see improved working conditions as lawmakers pass a sweeping legislation to regulate the delivery industry. The move, which recognizes the efforts of delivery workers to meet the spike in demand during the pandemic and the challenging conditions through which they carried out deliveries during the floods caused by Hurricane Ida, concerns Grubhub, owned by Just Eat Takeaway and DoorDash, which dominate the industry apart from Uber. While Uber and DoorDash carry a Zacks Rank #3 (Hold), Just Eat Takeaway.com carries a Zacks Rank #4 (Sell).
Some of the protections offered in the series of bills passed on Thursday include the ability of workers to set the maximum distance they are willing to travel per trip, the option to not accept trips over bridges or in tunnels, the companies disclosing gratuity policies to workers, and restaurants allowing couriers to use their bathrooms when a delivery is being picked up.
The bills prohibit food delivery apps from charging couriers for the payment of their wages, and they must pay delivery workers at least once a week. In order to determine the minimum payment required per trip, the Department of Consumer and Worker Protection is required to conduct a study on food delivery workers.
While Uber has not yet commented, a CNBC report quoted a DoorDash spokesperson saying, “We recognize the unique challenges facing delivery workers in New York City and share the goal of identifying policies that will help Dashers and workers like them.” The spokesperson added, “We will continue to work with all stakeholders, including the City Council, to identify ways to support all delivery workers in New York City without unintended consequences.”
Supporting the bills, a Grubhub spokesperson, Grant Klinzman, told CNBC, “These bills are common-sense steps to support the delivery workers who work hard every day for New York’s restaurants and residents.” Klinzman added, “Ensuring they receive a living wage and have access to restrooms isn’t just a good idea - it’s the right thing to do.”
Efforts have been ongoing to protect gig workers and offer them more benefits. Last month, a California court ruled that Proposition 22 (Prop 22), a ballot initiative that allowed gig companies, including Uber, to retain the independent contractor status for their drivers, was unconstitutional. While retaining the independent contractor status, Prop 22 provides workers with a number of benefits, including a certain amount of guaranteed earnings, a healthcare stipend and accident insurance for on-the-job injuries.
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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.