Tuesday, December 19, 2023

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 Meta Platforms, Inc. (META), Broadcom Inc. (AVGO) and Toyota Motor Corp. (TM). 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 >>>

Shares of Meta Platforms have outperformed the Zacks Internet - Software industry over the past six months (+21.2% vs. +13.4%). The company is benefiting from steady user growth across all regions, particularly Asia Pacific. Increased engagement for its offerings like Instagram, WhatsApp, Messenger and Facebook has been a major growth driver.

Meta Platforms is leveraging AI to recommend Reels content, which is driving traffic on Instagram and Facebook. Its innovative portfolio, which includes Threads, Reels and Llama 2, is likely to aid prospects. Advertising revenues are expected to witness a CAGR of 13% per Zacks model estimate.

However, challenging macroeconomic conditions remain a headwind for Meta’s advertising revenues, along with targeting and measurement headwinds due to Apple’s iOS changes. Slow monetization of Reels, along with mounting operating losses at Reality Labs, are concerns.

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

Broadcom’s shares have outperformed the Zacks Electronics - Semiconductors industry over the past six months (+33.6% vs. +20.7%). The company is benefiting from the strong deployment of generative AI. It expects generative AI to contribute more than 25% of semiconductor revenues in fiscal 2024.

Strong demand for Tomahawk 5, Jericho, 10-gigabit PON and DOCSIS 3.1 with embedded Wi-Fi 6 and 6E aids Broadcom’s prospects. Its expanding portfolio with the launch of the second-gen Wi-Fi 7 wireless connectivity chip is a catalyst.

Broadcom expects networking revenues to grow nearly 30% year over year in fiscal 2024. VMware is expected to contribute $12 billion to revenues. Infrastructure software revenues are expected to be $20 billion while semiconductor solutions revenues are expected to increase in the mid to high-single-digit percentage range on a year-over-year basis in fiscal 2024.

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

Shares of Toyota Motor have outperformed the Zacks Automotive - Foreign industry over the past six months (+16.6% vs. +13.7%). The company is one of the world’s leading automakers, with an array of brands, including Toyota, Lexus and Scion, which position it for solid growth.

Continued demand for vehicles and a robust lineup of trucks and sport utility vehicles (SUVs) are set to fuel Toyota’s sales volumes. To capitalize on the accelerated global shift to environment-friendly vehicles, the auto giant is deepening its focus on manufacturing electric and fuel-cell vehicles, which will bolster its product competitiveness.

The Japanese auto giant aims to generate 40% of its global sales from EVs by 2025 and 70% by 2030. It plans to invest 4 trillion yen ($35 billion) for a lineup of 30 BEVs by 2030. TM aims to expand global sales of BEVs to 3.5 million units per year by 2030. Thus, we are bullish on the stock.

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

Other noteworthy reports we are featuring today include HSBC Holdings plc (HSBC), IBM Corp. (IBM) and Monster Beverage Corp. (MNST).

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>>>