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Yellow and Golden Entertainment have been highlighted as Zacks Bull and Bear of the Day
Read MoreHide Full Article
For Immediate Release
Chicago, IL – August 5, 2022 – Zacks Equity Research shares Yellow as the Bull of the Day and Golden Entertainment (GDEN - Free Report) asthe Bear of the Day. In addition, Zacks Equity Research provides analysis on Amazon (AMZN - Free Report) , Microsoft (MSFT - Free Report) , and Alphabet (GOOGL - Free Report) .
Yellow is a Zacks Rank #1 (Strong Buy) and sports a B for Value and a C for Growth. This is logistics play posted a strong quarter and the stock soared as a result. Let’s explore more about this company in this Bull of The Day article.
Description
Yellow Corporation provides comprehensive logistics and less-than-truckload networks in North America with local, regional, national and international. The company offers industry expertise in flexible supply chain solutions, ensuring customers can ship industrial, commercial and retail goods. It is the holding company for a portfolio of LTL brands including Holland, New Penn, Reddaway and YRC Freight, as well as the logistics company HNRY Logistics. Yellow Corporation, formerly known as YRC Worldwide Inc., YELL is based in Overland Park, KN.
Earnings History
When I look at a stock, the first thing I do is look to see if the company is beating the number. This tells me right away where the market’s expectations have been for the company and how management has communicated to the market. A stock that consistently beats has management communicating expectations to Wall Street that can be achieved. That is what you want to see.
For YELL, I see three of the last four quarters were beats of the Zacks Consensus Estimate. That is great to see, but by itself that is not enough to make the company a Zacks Rank #1 (Strong Buy).
The average positive earnings surprise over the course of the last year works out to be 145%. With a miss factored into the average, we know that the beats are very large in size.
Most Recent Quarter
At the time of writing this Bull of the Day article, YELL was soaring. Shares were trading 45% higher than the previous close as investors loved the results.
The company posted revenue of $1.42 billion when the Wall Street Consensus was calling for $1.38 billion.
EPS came in at $1.15 and that was $0.80 more than the Zacks Consensus Estimate of $0.35. That translates in to a 228% positive earning surprise.
The company also showed some restraint in lowering the guidance for capital expenditures to be in the range of $250 million to $300 million compared to the previous range of $325 million to $400 million.
Earnings Estimates Revisions
The Zacks Rank tells us which stocks are seeing earnings estimates move higher. For YELL, I see annual estimates moving higher.
Over the last 60 days, I see a few increases.
The full fiscal year 2022 has moved from $0.59 to $0.71.
Next fiscal year has also increased from $0.86 to $1.06.
Positive movement in earnings estimates like that is why this stock is a Zacks Rank #1 (Strong Buy).
It should be noted that estimate revisions will still be coming in for YELL over the next few days and we should expect to see the consensus move higher.
Valuation
The valuation for YELL is compelling with a 6.6x forward earnings multiple. The company is a slow grower with only mid single digits sales growth expected for this year. That said, the company posted year over year sales of more than 8% in the most recent quarter so there could be some sandbagging built into this number. Margins a negative right now, but are headed in the right direction.
A big move after a solid report is good to see for a stock that was trading over $12 at the start of the year. The stock looks like it might have bottomed out in June and is now making a move back up. This is a good name to keep on your aggressive growth radar screen.
Golden Entertainment is a Zacks Rank #5 (Strong Sell) and is slated to report after the close on August 4. This article was written before the earnings print, but the core idea still rings true. This is a gaming name and after we just got confirmation that we are in a recession you have to think that investors will not be looking that hard as a discretionary name like this. Let’s look at why this stock is a Zacks Rank #5 (Strong Sell) in this Bear of the Day article.
Description
Golden Entertainment, Inc. is a diverse gaming company which offers casino, distribute gaming and lottery services. The company's gaming divisions consists of Golden Casino Group, PT's Entertainment Group and Golden Route Operations. Golden Entertainment, Inc., formerly known as Lakes Entertainment, Inc., is based in Las Vegas.
Earnings History
When I look at a stock, the first thing I do is look to see if the company is beating the number. This tells me right away where the market’s expectations have been for the company and how management has communicated to the market. A stock that consistently beats has management communicating expectations to Wall Street that can be achieved. That is what you want to see.
In the case of GDEN, I see three beats of the Zacks Consensus Estimate and one miss. This alone does not make the stock a Zacks Rank #1 (Strong Buy) and it doesn’t make it a Zacks Rank #5 (Strong Sell) either.
The Zacks Rank does care about the earnings history, but it is much more heavily influenced by the movement of earnings estimates.
Earnings Estimates
The Zacks Rank tells us which stocks are seeing earnings estimates move higher or in this case lower. For GDEN see annual estimates moving lower.
The current fiscal year 2022 consensus number has dropped from $3.73 to $3.54 over the last 60 days.
The next year has dropped from $3.92 to $3.60 over the same time period.
Negative movement in earnings estimates like that is why this stock is a Zacks Rank #5 (Strong Sell).
It should be noted that a majority of stocks in the Zacks universe are seeing negative earnings estimate revisions. That means that the stocks that are seeing small but negative earnings estimate revisions are falling to a Zacks Rank #5 (Strong Sell).
Additional content:
3 Titans With Robust Cloud Computing Segments
A fascinating industry that has rapidly gained traction over the last several years is cloud computing. It’s undoubtedly a significant highlight of modern technology that’s allowed companies and consumers to achieve digital feats that otherwise felt impossible.
For a quick, somewhat simplistic definition, cloud computing is the delivery of computing services – including servers, storage, databases, networking, software, analytics, and intelligence – over the internet to offer accelerated innovation, flexible resources, and economies of scale.
The “cloud” is incredibly secure, fast, and reliable. In addition, it eliminates the need to buy expensive hardware.
Three big players in the cloud computing realm include Amazon, Alphabet, and Microsoft. All three companies’ shares have been strong over the last month. It seems that the market has finally found some buyers.
Let’s dig deeper into each company.
Amazon
Amazon Web Services (AWS), Amazon’s cloud service, is the world’s most comprehensive and broadly adopted cloud platform. The service has millions of customers, including fast-growing startups, large enterprises, and leading government agencies.
In addition, Nasdaq has shared its multi-year partnership to migrate its markets onto AWS to become the world’s first fully enabled, cloud-based exchange – undoubtedly a major positive.
In the company’s latest quarterly print, AWS net sales came in at a strong $19.7 billion, a solid 7% increase from the prior quarter and a sizable 33% year-over-year increase.
The long-term growth of AWS is even more impressive – for the current fiscal year, AWS is forecasted to rake in $81.8 billion in net sales, a remarkable 370% increase from 2017 annual net sales of $17.4 billion.
Furthermore, AWS will significantly aid the company’s top-line – Amazon is forecasted to rake in a mighty $524 billion in revenue in FY22, notching a notable 11.6% year-over-year uptick from FY21.
Microsoft
Microsoft Azure is the company’s cloud computing service. It’s the only consistent hybrid cloud, delivering unparalleled developer productivity and comprehensive, multilayered security. Azure is available in more than 60 regions globally.
In its latest quarter, Intelligent Cloud revenue was reported at $20.9 billion, an impressive 20% year-over-year uptick. In addition, server products and cloud services revenue grew 22%, driven by Azure.
Of course, the growth is projected to continue at a breakneck pace – for the company’s current fiscal year, Intelligent Cloud revenue is forecasted to climb to $91 billion, reflecting a 21% double-digit uptick year-over-year.
Additionally, MSFT believes that cloud technology will be a critical growth driver of its top line in the future, and projections reflect that; for the current fiscal year (FY23), Microsoft is forecasted to rake in $219 billion in revenue, a rock-solid 11% year-over-year uptick.
Alphabet
Alphabet’s cloud offerings include Google Cloud Platform and Google Workspace, which are continuously gaining momentum in the booming cloud computing market.
Google Cloud consists of a set of physical assets, such as computers and hard disk drives, and virtual resources, such as virtual machines (VMs), that are contained in Google's data centers around the globe.
In the tech titan’s latest quarterly print, Google Cloud revenue was reported at $6.3 billion, good enough for a solid 9% increase from the prior quarter and a double-digit 37% year-over-year increase.
In addition, Google Cloud revenue is forecasted to continue its growth trajectory, with the $26.8 billion revenue estimate for the current fiscal year displaying an impressive 40% uptick year-over-year.
Alphabet has stated multiple times that the cloud will be a long-term focus. In its latest quarter, Sundar Pichai, CEO of Alphabet, said, “On Cloud, we continue to see strong momentum, the substantial market opportunity here, and it still feels like the early stages of this transformation.”
Like MSFT and AMZN, the cloud is expected to drive top-line growth. For the company’s current fiscal year, revenue is forecasted to surge 12%, up to $237.7 billion.
Bottom Line
Cloud computing is a fascinating industry that’s taken off over the last several years. While many believe that we’re still in the early stages of this transformation, Microsoft, Amazon, and Alphabet have all been at the forefront, getting in “early.”
It also represents an exciting investment opportunity, as cloud computing segments have consistently registered serious growth. Moving forward, the projections look even more robust.
For investors seeking exposure to a rapidly expanding industry, Amazon, Microsoft, and Alphabet would all be excellent choices.
Why Haven’t You Looked at Zacks' Top Stocks?
Our 5 best-performing strategies have blown away the S&P's impressive +28.8% gain in 2021. Amazingly, they soared +40.3%, +48.2%, +67.6%, +94.4%, and +95.3%. Today you can access their live picks without cost or obligation.
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/performancefor information about the performance numbers displayed in this press release.
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Yellow and Golden Entertainment have been highlighted as Zacks Bull and Bear of the Day
For Immediate Release
Chicago, IL – August 5, 2022 – Zacks Equity Research shares Yellow as the Bull of the Day and Golden Entertainment (GDEN - Free Report) asthe Bear of the Day. In addition, Zacks Equity Research provides analysis on Amazon (AMZN - Free Report) , Microsoft (MSFT - Free Report) , and Alphabet (GOOGL - Free Report) .
Here is a synopsis of all five stocks:
Bull of the Day:
Yellow is a Zacks Rank #1 (Strong Buy) and sports a B for Value and a C for Growth. This is logistics play posted a strong quarter and the stock soared as a result. Let’s explore more about this company in this Bull of The Day article.
Description
Yellow Corporation provides comprehensive logistics and less-than-truckload networks in North America with local, regional, national and international. The company offers industry expertise in flexible supply chain solutions, ensuring customers can ship industrial, commercial and retail goods. It is the holding company for a portfolio of LTL brands including Holland, New Penn, Reddaway and YRC Freight, as well as the logistics company HNRY Logistics. Yellow Corporation, formerly known as YRC Worldwide Inc., YELL is based in Overland Park, KN.
Earnings History
When I look at a stock, the first thing I do is look to see if the company is beating the number. This tells me right away where the market’s expectations have been for the company and how management has communicated to the market. A stock that consistently beats has management communicating expectations to Wall Street that can be achieved. That is what you want to see.
For YELL, I see three of the last four quarters were beats of the Zacks Consensus Estimate. That is great to see, but by itself that is not enough to make the company a Zacks Rank #1 (Strong Buy).
The average positive earnings surprise over the course of the last year works out to be 145%. With a miss factored into the average, we know that the beats are very large in size.
Most Recent Quarter
At the time of writing this Bull of the Day article, YELL was soaring. Shares were trading 45% higher than the previous close as investors loved the results.
The company posted revenue of $1.42 billion when the Wall Street Consensus was calling for $1.38 billion.
EPS came in at $1.15 and that was $0.80 more than the Zacks Consensus Estimate of $0.35. That translates in to a 228% positive earning surprise.
The company also showed some restraint in lowering the guidance for capital expenditures to be in the range of $250 million to $300 million compared to the previous range of $325 million to $400 million.
Earnings Estimates Revisions
The Zacks Rank tells us which stocks are seeing earnings estimates move higher. For YELL, I see annual estimates moving higher.
Over the last 60 days, I see a few increases.
The full fiscal year 2022 has moved from $0.59 to $0.71.
Next fiscal year has also increased from $0.86 to $1.06.
Positive movement in earnings estimates like that is why this stock is a Zacks Rank #1 (Strong Buy).
It should be noted that estimate revisions will still be coming in for YELL over the next few days and we should expect to see the consensus move higher.
Valuation
The valuation for YELL is compelling with a 6.6x forward earnings multiple. The company is a slow grower with only mid single digits sales growth expected for this year. That said, the company posted year over year sales of more than 8% in the most recent quarter so there could be some sandbagging built into this number. Margins a negative right now, but are headed in the right direction.
A big move after a solid report is good to see for a stock that was trading over $12 at the start of the year. The stock looks like it might have bottomed out in June and is now making a move back up. This is a good name to keep on your aggressive growth radar screen.
Bear of the Day:
Golden Entertainment is a Zacks Rank #5 (Strong Sell) and is slated to report after the close on August 4. This article was written before the earnings print, but the core idea still rings true. This is a gaming name and after we just got confirmation that we are in a recession you have to think that investors will not be looking that hard as a discretionary name like this. Let’s look at why this stock is a Zacks Rank #5 (Strong Sell) in this Bear of the Day article.
Description
Golden Entertainment, Inc. is a diverse gaming company which offers casino, distribute gaming and lottery services. The company's gaming divisions consists of Golden Casino Group, PT's Entertainment Group and Golden Route Operations. Golden Entertainment, Inc., formerly known as Lakes Entertainment, Inc., is based in Las Vegas.
Earnings History
When I look at a stock, the first thing I do is look to see if the company is beating the number. This tells me right away where the market’s expectations have been for the company and how management has communicated to the market. A stock that consistently beats has management communicating expectations to Wall Street that can be achieved. That is what you want to see.
In the case of GDEN, I see three beats of the Zacks Consensus Estimate and one miss. This alone does not make the stock a Zacks Rank #1 (Strong Buy) and it doesn’t make it a Zacks Rank #5 (Strong Sell) either.
The Zacks Rank does care about the earnings history, but it is much more heavily influenced by the movement of earnings estimates.
Earnings Estimates
The Zacks Rank tells us which stocks are seeing earnings estimates move higher or in this case lower. For GDEN see annual estimates moving lower.
The current fiscal year 2022 consensus number has dropped from $3.73 to $3.54 over the last 60 days.
The next year has dropped from $3.92 to $3.60 over the same time period.
Negative movement in earnings estimates like that is why this stock is a Zacks Rank #5 (Strong Sell).
It should be noted that a majority of stocks in the Zacks universe are seeing negative earnings estimate revisions. That means that the stocks that are seeing small but negative earnings estimate revisions are falling to a Zacks Rank #5 (Strong Sell).
Additional content:
3 Titans With Robust Cloud Computing Segments
A fascinating industry that has rapidly gained traction over the last several years is cloud computing. It’s undoubtedly a significant highlight of modern technology that’s allowed companies and consumers to achieve digital feats that otherwise felt impossible.
For a quick, somewhat simplistic definition, cloud computing is the delivery of computing services – including servers, storage, databases, networking, software, analytics, and intelligence – over the internet to offer accelerated innovation, flexible resources, and economies of scale.
The “cloud” is incredibly secure, fast, and reliable. In addition, it eliminates the need to buy expensive hardware.
Three big players in the cloud computing realm include Amazon, Alphabet, and Microsoft. All three companies’ shares have been strong over the last month. It seems that the market has finally found some buyers.
Let’s dig deeper into each company.
Amazon
Amazon Web Services (AWS), Amazon’s cloud service, is the world’s most comprehensive and broadly adopted cloud platform. The service has millions of customers, including fast-growing startups, large enterprises, and leading government agencies.
In addition, Nasdaq has shared its multi-year partnership to migrate its markets onto AWS to become the world’s first fully enabled, cloud-based exchange – undoubtedly a major positive.
In the company’s latest quarterly print, AWS net sales came in at a strong $19.7 billion, a solid 7% increase from the prior quarter and a sizable 33% year-over-year increase.
The long-term growth of AWS is even more impressive – for the current fiscal year, AWS is forecasted to rake in $81.8 billion in net sales, a remarkable 370% increase from 2017 annual net sales of $17.4 billion.
Furthermore, AWS will significantly aid the company’s top-line – Amazon is forecasted to rake in a mighty $524 billion in revenue in FY22, notching a notable 11.6% year-over-year uptick from FY21.
Microsoft
Microsoft Azure is the company’s cloud computing service. It’s the only consistent hybrid cloud, delivering unparalleled developer productivity and comprehensive, multilayered security. Azure is available in more than 60 regions globally.
In its latest quarter, Intelligent Cloud revenue was reported at $20.9 billion, an impressive 20% year-over-year uptick. In addition, server products and cloud services revenue grew 22%, driven by Azure.
Of course, the growth is projected to continue at a breakneck pace – for the company’s current fiscal year, Intelligent Cloud revenue is forecasted to climb to $91 billion, reflecting a 21% double-digit uptick year-over-year.
Additionally, MSFT believes that cloud technology will be a critical growth driver of its top line in the future, and projections reflect that; for the current fiscal year (FY23), Microsoft is forecasted to rake in $219 billion in revenue, a rock-solid 11% year-over-year uptick.
Alphabet
Alphabet’s cloud offerings include Google Cloud Platform and Google Workspace, which are continuously gaining momentum in the booming cloud computing market.
Google Cloud consists of a set of physical assets, such as computers and hard disk drives, and virtual resources, such as virtual machines (VMs), that are contained in Google's data centers around the globe.
In the tech titan’s latest quarterly print, Google Cloud revenue was reported at $6.3 billion, good enough for a solid 9% increase from the prior quarter and a double-digit 37% year-over-year increase.
In addition, Google Cloud revenue is forecasted to continue its growth trajectory, with the $26.8 billion revenue estimate for the current fiscal year displaying an impressive 40% uptick year-over-year.
Alphabet has stated multiple times that the cloud will be a long-term focus. In its latest quarter, Sundar Pichai, CEO of Alphabet, said, “On Cloud, we continue to see strong momentum, the substantial market opportunity here, and it still feels like the early stages of this transformation.”
Like MSFT and AMZN, the cloud is expected to drive top-line growth. For the company’s current fiscal year, revenue is forecasted to surge 12%, up to $237.7 billion.
Bottom Line
Cloud computing is a fascinating industry that’s taken off over the last several years. While many believe that we’re still in the early stages of this transformation, Microsoft, Amazon, and Alphabet have all been at the forefront, getting in “early.”
It also represents an exciting investment opportunity, as cloud computing segments have consistently registered serious growth. Moving forward, the projections look even more robust.
For investors seeking exposure to a rapidly expanding industry, Amazon, Microsoft, and Alphabet would all be excellent choices.
Why Haven’t You Looked at Zacks' Top Stocks?
Our 5 best-performing strategies have blown away the S&P's impressive +28.8% gain in 2021. Amazingly, they soared +40.3%, +48.2%, +67.6%, +94.4%, and +95.3%. Today you can access their live picks without cost or obligation.
See 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/performancefor information about the performance numbers displayed in this press release.