Today's Must Read
New Branches, Digitization Aid BofA (BAC) amid Lower Rates
McDonald's (MCD) Banks on Digitization, Traffic Woes Stay
Thursday, April 8, 2021
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 NVIDIA (NVDA), Bank of America (BAC), and McDonald's (MCD). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Shares of NVIDIA have outperformed the Zacks General Semiconductor industry over the past year (+118% vs. +63.3%) on the back of the company's emergence as a force to be reckoned with in all the major growth markets within the broader chip space.
It is also benefiting from strong growth in GeForce desktop and notebook GPUs, which is boosting gaming revenues. Moreover, a surge in Hyperscale demand remains a tailwind for the company’s Data Center business. Expansion of NVIDIA GeForce NOW is expected to drive user base.
Additionally, collaboration with Daimler-owned Mercedes-Benz is expected to further strengthen NVIDIA’s presence in the autonomous vehicles and other automotive electronics space. However, management expects COVID-19 pandemic to negatively impact near-term revenues.
Bank of America shares have gained +55.8% over the last six months against the Zacks Major Regional Banks industry’s gain of +52.7%. The Zacks analyst believes that opening of new branches, improvement in digital offerings and efforts to manage expenses are expected to aid the company's profitability in the quarters ahead.
A strong balance sheet and liquidity position are expected to continue aiding its financials. The company will likely continue to enhance shareholder value through sustained capital deployments.
However, near-zero interest rates and no near-term chance of any change in the same are expected to keep hurting the bank’s margins and interest income to an extent. Further, the company's high dependence on the volatile nature of the capital markets to generate fee income makes us apprehensive.
Shares of McDonald's have gained +7.6% in the past three months against the Zacks Restaurants industry’s gain of +8.4%. The Zacks analyst believes that the company’s increased focus on drive-thru, delivery & take-away is likely to benefit the company going forward.
In order to boost its digital offerings across drive thru, takeaway, delivery, curbside pick-up and dine-in categories, the company is currently working on a new digital experience growth engine “MyMcDonald’s”.
Additionally, the company is making every effort to drive growth in international markets as well. Although the company has reopened most of its restaurants, it is likely to witness dismal traffic due the social distancing protocols.
Other noteworthy reports we are featuring today include Sony Group (SONY), BlackRock (BLK) and American Express (AXP).
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Director of Research
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>>>