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The Zacks Analyst Blog Highlights Kubota, Nutanix and Zebra Technologies
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For Immediate Release
Chicago, IL – May 14, 2024 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Kubota (KUBTY - Free Report) , Nutanix (NTNX - Free Report) and Zebra Technologies (ZBRA - Free Report) .
Here are highlights from Monday’s Analyst Blog:
U.S. CPI Resets a Market Narrative: Global Week Ahead
Before thisGlobal Week Ahead begins, global central banks have started to break away from the pack, as policy rate cuts roll out across Europe.
Meanwhile, borrowing costs in the U.S. may stay ‘higher-for-longer,’ which has been lifting the U.S. dollar’s value.
A key set of U.S. Consumer Price Inflation (CPI) data rests at the heart of the stock and bond trading week’s macro event calendar.
That April CPI data is the deciding factor in the near-term direction for risk markets.
Next is Reuters’ five world market themes, reordered for equity traders—
(1) On Wednesday, April 15th, the U.S. April Consumer Price Inflation (CPI) Data Lands, at 8:30 am ET
Goldilocks is getting a health check, with U.S. inflation data set to show whether consumer prices are finally cooling after a run of unexpected strength.
For months, the balance of resilient growth and easing inflation that some investors dub the "Goldilocks scenario" helped buoy markets — until it was upended by a series of data showing the economy was more robust than expected.
Some relief came earlier this month, when the Federal Reserve assured markets it was still looking to eventually cut rates, and a U.S. employment report showed signs of cooling in the labor market.
Inflation data on May 15th could keep the good vibes going if it shows consumer prices increased at a slower pace. But more evidence of stubborn inflation could renew interest rate worries and reignite market volatility. Economists polled by Reuters project CPI to have gained 0.3% in April month-on-month.
(2) Which Way Will the U.S. Dollar Be Going from Here?
The forex market feels like a one-way street.
Central banks no longer operate like the rate-raising herd of 2022 and 2023, leaving the dollar to batter almost everything else, with the Federal Reserve likely to keep U.S. rates high for some time.
Speculators now hold their largest bullish bet on the dollar against any other major currency in five years.
Currencies bearing low rates get punished extra hard, leaving the Japanese yen and Swiss franc as the biggest laggards, down around 8% each this year.
The net long position in the dollar against other G10 currencies is worth around $33 billion. In January, when markets anticipated at least five U.S. rate cuts in 2024, investors held roughly $7.23 billion in bets against the dollar.
As rate outlook expectations have unraveled, so have those bearish positions. Expect more, not less, dollar strength ahead.
(3) On Tuesday, May 14th, Key U.K. Labor Data Lands. Does the BoE Cut in June?
The Bank of England (BoE) is expected to cut interest rates this year after inflation eased, but remains on alert for pay rises refueling price pressures ahead of fresh labor market data due on May 14th.
Traders see a good chance the BoE policy rate falls in June. But the central bank might need more time and data to be sure that Britain has escaped a wage and price spiral.
Annual pay growth is still running hot, while labor supply is stagnating, with more than a fifth of working-age adults not seeking employment and the number of people registered as long-term sick having hit 2.83 million, the highest since records began in 1993.
(4) On Thursday, May 16th, Japan Produces Q1 Real GDP Growth Figures
Japan may have narrowly avoided a technical recession in Q4-23, but the narrative over the longer-term growth outlook hasn't changed much.
An aging population and weak domestic demand continue to plague the Asian nation, coupled with a weakening yen that's struggling to gain ground, even after Tokyo's latest bouts of suspected intervention.
Thursday's Q1-24 growth figures will reveal whether the Japanese economy began 2024 on a strong footing, especially since the Bank of Japan (BOJ) in March made a landmark exit from negative interest rates, kickstarting a tentative virtuous cycle of rising wages and prices.
But the BOJ's preference to keep monetary policy accommodative for now is unlikely to take the pressure off the yen, as interest rates elsewhere remain at multi-decade highs, in turn squeezing households further as import costs rise.
(5) On Friday, May 17th, Mainland China’s Beleaguered Home Price Data Lands
The negative sentiment towards Mainland China has been turning in recent days, though investors are keeping a close eye on the country's real estate market and what's to become of it.
April home price data on May 17th will be the next barometer of health for the beleaguered sector, which has been engulfed by a debt crisis for about three years now, leaving property developers on the brink of collapse.
The release comes alongside China's retail sales and urban unemployment rate figures due the same day, and on the heels of disappointing May Day spending data.
Comments from policymakers at April's Politburo meeting have primed investors for a wave of stimulus measures from Beijing to boost economic recovery, keeping the market mood buoyant for now.
Chinese stocks have edged away from their February lows, while the China yuan seems to have found a floor.
Zacks #1 Rank (STRONG BUY) Stocks
(1) Kubota: This is a $80 Japanese large cap stock, with a market cap of $18.9B. It is found in the Manufacturing – Farm Equipment industry. I see a Zacks Value score of B, a Zacks Growth score of C and a Zacks Momentum score of C.
Kubota is the world's largest maker of small tractors and Japan's 2nd largest manufacturer of farm equipment.
The company is also Japan's largest producer of ductile iron pipe (for water supply and sewer systems) and its maker of roofing materials.
The company makes engines, construction machinery, industrial castings and machinery, waste recycling plants, and prefab housing and pumps.
It has stakes in several US computer companies, including memory storage makers Maxoptix and Akashic Memories.
(2) Nutanix: This is a $67 info tech stock, with a market cap of $16.5B. It is found in the Computer – IT Services industry. I see a Zacks Value score of F, a Zacks Growth score of A and a Zacks Momentum score of D.
San Jose, CA-based Nutanix Inc. provides an enterprise cloud operating system that combines server, storage, virtualization and networking software into one integrated solution.
Nutanix’s solution can be delivered either as an appliance that is configured to order, or as software only.
The company currently offers two software product families — Acropolis and Prism.
Acropolis includes Distributed Storage Fabric (DSF) that supports a wide variety of enterprise applications and has the capability to operate both virtualized and non-virtualized applications. The solution also includes Application Mobility Fabric (AMF), leading to increasing levels of application placement, conversion and migration across different hypervisors and public clouds. It also has a built-in Acropolis hypervisor (AHV), based on Linux KVM.
Prism helps in automating IT management. The solution enables efficient regulation of enterprise-wide deployments by serving as a central administration point to manage multiple clusters and hypervisors (including VMware ESXi environments) within a datacenter or across multiple sites. Prism is built with HTML5 and can be accessed from any connected device that is HTML5-enabled including smartphones and tablets.
Nutanix generated revenues of $1.86 billion in fiscal 2023. Subscriptions, Non-Portable Software, Hardware and Professional Services accounted for 93%, 2%, 0.1% and 4.9% of revenues, respectively.
The company faces stiff competition from software providers, such as VMware; traditional IT systems vendors, namely Cisco Systems, Dell, Hewlett Packard Enterprise, Hitachi Data Systems, IBM and Lenovo; traditional storage array vendors like NetApp and providers of public cloud infrastructure and services, such as Amazon, Google and Microsoft.
(3) Zebra Technologies: This is a $316 info tech stock, with a market cap of $16.3B. It is found in the Manufacturing – Thermal Products industry. I see a Zacks Value score of F, a Zacks Growth score of F and a Zacks Momentum score of A.
Zebra is a global leader providing Enterprise Asset Intelligence (EAI) solutions in the Automatic Identification and Data Capture (AIDC) industry.
The AIDC market consists of mobile computing, data capture, radio frequency identification devices (RFID), barcode printing, and other workflow automation products and services.
They design, manufacture, and sell a broad range of AIDC products, including: mobile computers, barcode scanners and imagers, RFID readers, specialty printers for barcode labeling and personal identification, real-time location systems (RTLS), related accessories and supplies, such as labels and other consumables, and related software applications.
They also provide a full range of services, including maintenance, technical support, repair, managed and professional services, as well as cloud-based software subscriptions and robotics automation solutions.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.
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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The Zacks Analyst Blog Highlights Kubota, Nutanix and Zebra Technologies
For Immediate Release
Chicago, IL – May 14, 2024 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Kubota (KUBTY - Free Report) , Nutanix (NTNX - Free Report) and Zebra Technologies (ZBRA - Free Report) .
Here are highlights from Monday’s Analyst Blog:
U.S. CPI Resets a Market Narrative: Global Week Ahead
Before thisGlobal Week Ahead begins, global central banks have started to break away from the pack, as policy rate cuts roll out across Europe.
Meanwhile, borrowing costs in the U.S. may stay ‘higher-for-longer,’ which has been lifting the U.S. dollar’s value.
A key set of U.S. Consumer Price Inflation (CPI) data rests at the heart of the stock and bond trading week’s macro event calendar.
That April CPI data is the deciding factor in the near-term direction for risk markets.
Next is Reuters’ five world market themes, reordered for equity traders—
(1) On Wednesday, April 15th, the U.S. April Consumer Price Inflation (CPI) Data Lands, at 8:30 am ET
Goldilocks is getting a health check, with U.S. inflation data set to show whether consumer prices are finally cooling after a run of unexpected strength.
For months, the balance of resilient growth and easing inflation that some investors dub the "Goldilocks scenario" helped buoy markets — until it was upended by a series of data showing the economy was more robust than expected.
Some relief came earlier this month, when the Federal Reserve assured markets it was still looking to eventually cut rates, and a U.S. employment report showed signs of cooling in the labor market.
Inflation data on May 15th could keep the good vibes going if it shows consumer prices increased at a slower pace. But more evidence of stubborn inflation could renew interest rate worries and reignite market volatility. Economists polled by Reuters project CPI to have gained 0.3% in April month-on-month.
(2) Which Way Will the U.S. Dollar Be Going from Here?
The forex market feels like a one-way street.
Central banks no longer operate like the rate-raising herd of 2022 and 2023, leaving the dollar to batter almost everything else, with the Federal Reserve likely to keep U.S. rates high for some time.
Speculators now hold their largest bullish bet on the dollar against any other major currency in five years.
Currencies bearing low rates get punished extra hard, leaving the Japanese yen and Swiss franc as the biggest laggards, down around 8% each this year.
The net long position in the dollar against other G10 currencies is worth around $33 billion. In January, when markets anticipated at least five U.S. rate cuts in 2024, investors held roughly $7.23 billion in bets against the dollar.
As rate outlook expectations have unraveled, so have those bearish positions. Expect more, not less, dollar strength ahead.
(3) On Tuesday, May 14th, Key U.K. Labor Data Lands. Does the BoE Cut in June?
The Bank of England (BoE) is expected to cut interest rates this year after inflation eased, but remains on alert for pay rises refueling price pressures ahead of fresh labor market data due on May 14th.
Traders see a good chance the BoE policy rate falls in June. But the central bank might need more time and data to be sure that Britain has escaped a wage and price spiral.
Annual pay growth is still running hot, while labor supply is stagnating, with more than a fifth of working-age adults not seeking employment and the number of people registered as long-term sick having hit 2.83 million, the highest since records began in 1993.
(4) On Thursday, May 16th, Japan Produces Q1 Real GDP Growth Figures
Japan may have narrowly avoided a technical recession in Q4-23, but the narrative over the longer-term growth outlook hasn't changed much.
An aging population and weak domestic demand continue to plague the Asian nation, coupled with a weakening yen that's struggling to gain ground, even after Tokyo's latest bouts of suspected intervention.
Thursday's Q1-24 growth figures will reveal whether the Japanese economy began 2024 on a strong footing, especially since the Bank of Japan (BOJ) in March made a landmark exit from negative interest rates, kickstarting a tentative virtuous cycle of rising wages and prices.
But the BOJ's preference to keep monetary policy accommodative for now is unlikely to take the pressure off the yen, as interest rates elsewhere remain at multi-decade highs, in turn squeezing households further as import costs rise.
(5) On Friday, May 17th, Mainland China’s Beleaguered Home Price Data Lands
The negative sentiment towards Mainland China has been turning in recent days, though investors are keeping a close eye on the country's real estate market and what's to become of it.
April home price data on May 17th will be the next barometer of health for the beleaguered sector, which has been engulfed by a debt crisis for about three years now, leaving property developers on the brink of collapse.
The release comes alongside China's retail sales and urban unemployment rate figures due the same day, and on the heels of disappointing May Day spending data.
Comments from policymakers at April's Politburo meeting have primed investors for a wave of stimulus measures from Beijing to boost economic recovery, keeping the market mood buoyant for now.
Chinese stocks have edged away from their February lows, while the China yuan seems to have found a floor.
Zacks #1 Rank (STRONG BUY) Stocks
(1) Kubota: This is a $80 Japanese large cap stock, with a market cap of $18.9B. It is found in the Manufacturing – Farm Equipment industry. I see a Zacks Value score of B, a Zacks Growth score of C and a Zacks Momentum score of C.
Kubota is the world's largest maker of small tractors and Japan's 2nd largest manufacturer of farm equipment.
The company is also Japan's largest producer of ductile iron pipe (for water supply and sewer systems) and its maker of roofing materials.
The company makes engines, construction machinery, industrial castings and machinery, waste recycling plants, and prefab housing and pumps.
It has stakes in several US computer companies, including memory storage makers Maxoptix and Akashic Memories.
(2) Nutanix: This is a $67 info tech stock, with a market cap of $16.5B. It is found in the Computer – IT Services industry. I see a Zacks Value score of F, a Zacks Growth score of A and a Zacks Momentum score of D.
San Jose, CA-based Nutanix Inc. provides an enterprise cloud operating system that combines server, storage, virtualization and networking software into one integrated solution.
Nutanix’s solution can be delivered either as an appliance that is configured to order, or as software only.
The company currently offers two software product families — Acropolis and Prism.
Acropolis includes Distributed Storage Fabric (DSF) that supports a wide variety of enterprise applications and has the capability to operate both virtualized and non-virtualized applications. The solution also includes Application Mobility Fabric (AMF), leading to increasing levels of application placement, conversion and migration across different hypervisors and public clouds. It also has a built-in Acropolis hypervisor (AHV), based on Linux KVM.
Prism helps in automating IT management. The solution enables efficient regulation of enterprise-wide deployments by serving as a central administration point to manage multiple clusters and hypervisors (including VMware ESXi environments) within a datacenter or across multiple sites. Prism is built with HTML5 and can be accessed from any connected device that is HTML5-enabled including smartphones and tablets.
Nutanix generated revenues of $1.86 billion in fiscal 2023. Subscriptions, Non-Portable Software, Hardware and Professional Services accounted for 93%, 2%, 0.1% and 4.9% of revenues, respectively.
The company faces stiff competition from software providers, such as VMware; traditional IT systems vendors, namely Cisco Systems, Dell, Hewlett Packard Enterprise, Hitachi Data Systems, IBM and Lenovo; traditional storage array vendors like NetApp and providers of public cloud infrastructure and services, such as Amazon, Google and Microsoft.
(3) Zebra Technologies: This is a $316 info tech stock, with a market cap of $16.3B. It is found in the Manufacturing – Thermal Products industry. I see a Zacks Value score of F, a Zacks Growth score of F and a Zacks Momentum score of A.
Zebra is a global leader providing Enterprise Asset Intelligence (EAI) solutions in the Automatic Identification and Data Capture (AIDC) industry.
The AIDC market consists of mobile computing, data capture, radio frequency identification devices (RFID), barcode printing, and other workflow automation products and services.
They design, manufacture, and sell a broad range of AIDC products, including: mobile computers, barcode scanners and imagers, RFID readers, specialty printers for barcode labeling and personal identification, real-time location systems (RTLS), related accessories and supplies, such as labels and other consumables, and related software applications.
They also provide a full range of services, including maintenance, technical support, repair, managed and professional services, as well as cloud-based software subscriptions and robotics automation solutions.
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Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.
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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.