Monday, April 8, 2024

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 SAP SE (SAP), Verizon Communications Inc. (VZ) and Lowe's Companies, Inc. (LOW). 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 >>>

SAP shares have outperformed the Zacks Computer - Software industry over the past year (+52.3% vs. +44.1%). The company’s performance is benefiting from continued strength in its cloud business, especially the Rise with SAP and Grow with SAP solutions. Momentum in SAP’s business technology platform, particularly the S/4HANA solution, along with proliferation of generative AI bodes well.

SAP is now focusing more on vital strategic growth areas, especially Business AI, and position the company for future growth. Management also reaffirmed its 2025 long-term targets for cloud and total revenues. Frequent product launches, and strategic acquisitions and collaborations are other tailwinds.

However, continued softness in the Software license and support business segment coupled with global macroeconomic weakness are concerning. Increasing costs and stiff competition are additional headwinds.

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

Shares of Verizon Communications have outperformed the Zacks Wireless National industry over the past year (+13.2% vs. +5.3%). The company is witnessing significant 5G adoption and fixed wireless broadband momentum with its 5G Ultra Wideband network. The deployment of a cloud-native, container-based, virtualized architecture has led to increased flexibility, scalability and cost efficiency across its network.

Verizon is offering various mix and match pricing in both wireless and home broadband plans, which has led to solid client additions. Focus on emerging growth services like cloud, security and professional services will likely reap long-term benefits.

However, lower wireline and wireless equipment revenues are major concerns. Huge promotional expenses and lucrative discounts to expand customer base are weighing on margins. High capital expenditures for network upgrade and deployment of fiber assets across the country are headwinds. A muted guidance for 2024 is worrisome.

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

Lowe's shares have modestly outperformed the Zacks Building Products - Retail industry over the year-to-date period (+8.1% vs. +6.8%). The company has implemented a comprehensive Pro-focused strategy, emphasizing improved product availability, timely delivery, and an expanded assortment, complemented by a rewards program.

Strategic growth initiatives such as store expansion and enhanced customer experiences aim to position the company as a top omnichannel retailer. Investments in service offerings, operational efficiency, and long-term drivers like sustained home improvement demand support growth and profitability.

However, market risks, intense competition, and a decline in DIY spending present challenges. Anticipated softness in comparable sales, margin pressure, and financial strain due to high debt and low cash reserves may hinder performance.

(You can read the full research report on Lowe’s here >>>)

Other noteworthy reports we are featuring today include Uber Technologies, Inc. (UBER), Citigroup Inc. (C) and Airbnb, Inc. (ABNB).

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>>>