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Research Daily

Monday, June 17, 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 Visa Inc. (V), Netflix, Inc. (NFLX) and Adobe Inc. (ADBE). 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 Visa have gained +18.2% over the past year against the Zacks Financial Transaction Services industry’s gain of +23.1%. The company’s strategic acquisitions and alliances are fostering long-term growth and consistently driving its revenues. It expects net revenues to increase in low double digits for fiscal 2024.

Visa, fueled by increased payments, cross-border volumes and sustained investments in technology, is witnessing significant profit growth. It reported strong fiscal 2Q24 results. The ongoing shift to digital payments is advantageous for Visa, with strong domestic volumes supporting its overall performance. A robust cash position enables the company to enhance shareholder value.

However, elevated operating expenses pose margin challenges. It is witnessing a volatile cash volume from the Asia Pacific and CEMEA regions. Moreover, rising client incentives will affect its adjusted revenues.

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

Netflix’s shares have outperformed the Zacks Broadcast Radio and Television industry over the year-to-date period (+37.5% vs. +14.1%). The company is benefiting from its growing subscriber base, thanks to a robust portfolio. Crackdown on password-sharing and the introduction of paid sharing in more than 100 countries, which represents over 80% of Netflix’s revenue base, is also expected to aid growth.

Netflix’s diversified content portfolio, which is attributable to heavy investments in the production and distribution of localized and foreign-language content, has been driving its growth prospects

However, stiff competition in the streaming space from the likes of Apple, Amazon Prime Video, Disney+, Peacock and Paramount+ is a headwind. Netflix’s leveraged balance sheet and a higher streaming obligation are concerns. Additionally, unfavorable forex is expected to hurt operating income in the second quarter of 2024.

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

Shares of Adobe have underperformed the Zacks Computer - Software industry over the year-to-date period (-11.9% vs. +14.2%). The company reported strong fiscal second-quarter results wherein both earnings and revenues grew year over year. The company’s Creative Cloud, Document Cloud and Adobe Experience Cloud products drove the top-line growth.

Further, rising subscription revenues and solid momentum across the mobile apps remained major positives. Growth in emerging markets, robust online video creation demand, and solid adoption of Acrobat and Firefly are tailwinds. Continued key customer wins of the company are contributing well.

The Zacks analyst remain optimistic about Adobe’s market position, compelling product lines, continued innovation, strategic acquisitions and solid adoption of cloud applications. However, the ongoing tensions between Russia and Ukraine remain major headwinds for Digital Media segment.

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

Other noteworthy reports we are featuring today include Morgan Stanley (MS), Occidental Petroleum Corp. (OXY) and Howmet Aerospace Inc. (HWM).

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>>>

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