We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
The Zacks Analyst Blog Highlights Cadence Design, Intuit, Texas Instruments, Palo Alto and Fortinet
Read MoreHide Full Article
For Immediate Release
Chicago, IL – August 22, 2022 – 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: Cadence Design Systems Inc. (CDNS - Free Report) , Intuit Inc. (INTU - Free Report) , Texas Instruments Inc. (TXN - Free Report) , Palo Alto Networks Inc. (PANW - Free Report) and Fortinet Inc. (FTNT - Free Report) .
Here are highlights from Friday’s Analyst Blog:
Nasdaq Composite Exits Bear Market: 5 Picks to Tap the Bull
U.S. stocks markets have been witnessing an impressive northbound journey since mid-June after completing a pathetic first half of 2022. Of the various sectors in the economy, technology suffered the most in this period. Interestingly of the three major indexes, the tech-heavy Nasdaq Composite has rallied the most since mid-June.
We believe the market rally will continue in the near future as most of the negatives, such as mounting inflation, a higher interest rate and tighter monetary control are already factored in the market's valuation. Moreover, better-than-expected second-quarter earnings results and stable fundamentals of the U.S. economy will likely provide the necessary impetus for the rally to sustain.
At this stage, it should be prudent to invest in the Nasdaq Composite listed technology giants with a favorable Zacks Rank to gain in the near term. Here are five such stocks — Cadence Design Systems Inc., Intuit Inc., Texas Instruments Inc., Palo Alto Networks Inc. and Fortinet Inc.
Nasdaq Composite Exits Bear Market
In the last two coronavirus-ridden years, the Nasdaq Composite recorded an astonishing rally of more than 140%. The tech-heavy index recorded its all-time high of 16212.23 on Nov 22, 2021.
The meteoric rise of the technology stocks was the sole reason for this impressive rally. Therefore, Wall Street started 2022 with a highly overvalued tech sector. Consequently, investors started profit booking in this sector.
Moreover, mounting inflation compelled the Fed to significantly raise the benchmark interest rate from March this year. The central bank also imposed tougher monetary control sucking liquidity from the economy and raising the market's risk-free returns.
A higher interest rate is detrimental to growth sectors like technology. Consequently, the tech-laden Nasdaq Composite entered bear market on Mar 7, 2022 after declining more than 20% from its recent high recorded on Nov 22. After entering the bear market, the Nasdaq Composite registered its recent low of 10,565.14 on Jun 16. Thereafter, the tech-laden index saw a sharp rebound along with two other major stock indexes — the Dow and the S&P 500.
Finally, on Aug 4, the Nasdaq Composite exited the bear market after rallying more than 20% from its recent low. Year to date, the index is down 17.1%. However, from Jun 16 low to Aug 18, the Nasdaq Composite has jumped 22.7%.
Technology the Best Bet for Recovery
The recent meltdown of the technology sector is a temporary phenomenon. The fundamentals of this sector are rock solid. We must not forget that the growing demand for hi-tech superior products has acted as a catalyst for the sector in an otherwise tough environment. At present, this sector is highly lucrative as a long list of tech behemoths are available at attractive valuations.
A series of breakthroughs in 5G wireless network, cloud computing, predictive analysis, AI, self-driving vehicles, digital personal assistants and IoT, has given a boost to the overall space. Consequently, the technology sector has vast potential.
Our Top Picks
We have narrowed our search to five Nasdaq Composite listed technology bigwigs with strong growth potential for the rest of 2022. These stocks have seen positive earnings estimate revisions in the last 90 days. Each of our picks carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
Cadence Design Systemsoffers products and tools that help customers design electronic products. Through the System Design Enablement strategy, CDNS offers software, hardware, services and reusable IC design blocks to electronic systems and semiconductor customers.
Cadence's performance is being driven by strength across segments like digital & signoff solutions and functional verification suite. CDNS is also gaining from higher investments in emerging trends like IoT and autonomous vehicle sub-systems along with strength in the semiconductor end-market. Frequent product launches are expected to help CDNS sustain top-line growth.
Cadence Design Systems has an expected earnings growth rate of 24.9% for the current year. The Zacks Consensus Estimate for current-year earnings improved 5.7% over the last 30 days.
Texas Instrumentsis benefiting from a continued rebound in the automotive market. A solid demand environment in the industrial end market contributed well. Growing momentum across the communication equipment and enterprise systems markets will benefit TXN in the long haul.
Additionally, the strong performance of Analog and Embedded Processing segments contributed well. Solid investments in new growth avenues and competitive advantages are acting as a tailwind for TXN. Further, the company's portfolio of long-lived products and efficient manufacturing strategies are the other positives.
Texas Instruments has an expected earnings growth rate of 13.2% for the current year. The Zacks Consensus Estimate for current-year earnings improved 6.5% over the last 30 days.
Palo Alto Networks has been benefiting from continuous deal wins and the increasing adoption of its next-generation security platforms, attributable to the rise in the remote work environment and the need for stronger security.
Growing traction in Prisma and Cortex offerings are acting as a tailwind. PANW continues to acquire new customers and increase wallet share with existing customers. Palo Alto Networks' higher sales incentives related to next-generation Security products are likely to continue to negatively impact its bottom line.
PANW has an expected earnings growth rate of 24.3% for the current fiscal-year (ending July 2023). The Zacks Consensus Estimate for current fiscal-year earnings has improved 0.1% over the last 60 days.
Intuit is benefiting from strong momentum in online ecosystem revenues and solid professional tax revenues. The TurboTax Live offering is also driving growth in the Consumer tax business.
Solid momentum in INTU's lending product, QuickBooks Capital, remains a positive. Moreover, Intuit's strategy of shifting its business to a cloud-based subscription model will help generate stable revenues over the long run.
Intuit has an expected earnings growth rate of 16.3% for the current year (ending July 2023). The Zacks Consensus Estimate for current-year earnings improved 1.2% over the last 90 days.
Fortinet is benefiting from rising demand for security and networking products amid the coronavirus crisis as a huge global workforce is working remotely. FTNT is also benefiting from robust growth in Fortinet Security Fabric, cloud and Software-defined Wide Area Network offerings.
Moreover, continued deal wins, especially those of high value, are solid drivers. Higher IT spending on cybersecurity is further expected to aid Fortinet to grow faster than the security market. Also, focus on enhancing its unified threat management portfolio through product development and acquisitions is a tailwind for FTNT.
Fortinet has an expected earnings growth rate of 30% for the current year. The Zacks Consensus Estimate for current-year earnings improved 2% over the last 30 days.
Why Haven't You Looked at Zacks' Top Stocks?
Our 5 best-performing strategies have blown away the S&P's impressive +28.8% gain in 2021. Amazingly, they soared+40.3%, +48.2%, +67.6%, +94.4%, and+95.3%. Today you can access their live picks without cost or obligation.
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.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
The Zacks Analyst Blog Highlights Cadence Design, Intuit, Texas Instruments, Palo Alto and Fortinet
For Immediate Release
Chicago, IL – August 22, 2022 – 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: Cadence Design Systems Inc. (CDNS - Free Report) , Intuit Inc. (INTU - Free Report) , Texas Instruments Inc. (TXN - Free Report) , Palo Alto Networks Inc. (PANW - Free Report) and Fortinet Inc. (FTNT - Free Report) .
Here are highlights from Friday’s Analyst Blog:
Nasdaq Composite Exits Bear Market: 5 Picks to Tap the Bull
U.S. stocks markets have been witnessing an impressive northbound journey since mid-June after completing a pathetic first half of 2022. Of the various sectors in the economy, technology suffered the most in this period. Interestingly of the three major indexes, the tech-heavy Nasdaq Composite has rallied the most since mid-June.
We believe the market rally will continue in the near future as most of the negatives, such as mounting inflation, a higher interest rate and tighter monetary control are already factored in the market's valuation. Moreover, better-than-expected second-quarter earnings results and stable fundamentals of the U.S. economy will likely provide the necessary impetus for the rally to sustain.
At this stage, it should be prudent to invest in the Nasdaq Composite listed technology giants with a favorable Zacks Rank to gain in the near term. Here are five such stocks — Cadence Design Systems Inc., Intuit Inc., Texas Instruments Inc., Palo Alto Networks Inc. and Fortinet Inc.
Nasdaq Composite Exits Bear Market
In the last two coronavirus-ridden years, the Nasdaq Composite recorded an astonishing rally of more than 140%. The tech-heavy index recorded its all-time high of 16212.23 on Nov 22, 2021.
The meteoric rise of the technology stocks was the sole reason for this impressive rally. Therefore, Wall Street started 2022 with a highly overvalued tech sector. Consequently, investors started profit booking in this sector.
Moreover, mounting inflation compelled the Fed to significantly raise the benchmark interest rate from March this year. The central bank also imposed tougher monetary control sucking liquidity from the economy and raising the market's risk-free returns.
A higher interest rate is detrimental to growth sectors like technology. Consequently, the tech-laden Nasdaq Composite entered bear market on Mar 7, 2022 after declining more than 20% from its recent high recorded on Nov 22.
After entering the bear market, the Nasdaq Composite registered its recent low of 10,565.14 on Jun 16. Thereafter, the tech-laden index saw a sharp rebound along with two other major stock indexes — the Dow and the S&P 500.
Finally, on Aug 4, the Nasdaq Composite exited the bear market after rallying more than 20% from its recent low. Year to date, the index is down 17.1%. However, from Jun 16 low to Aug 18, the Nasdaq Composite has jumped 22.7%.
Technology the Best Bet for Recovery
The recent meltdown of the technology sector is a temporary phenomenon. The fundamentals of this sector are rock solid. We must not forget that the growing demand for hi-tech superior products has acted as a catalyst for the sector in an otherwise tough environment. At present, this sector is highly lucrative as a long list of tech behemoths are available at attractive valuations.
A series of breakthroughs in 5G wireless network, cloud computing, predictive analysis, AI, self-driving vehicles, digital personal assistants and IoT, has given a boost to the overall space. Consequently, the technology sector has vast potential.
Our Top Picks
We have narrowed our search to five Nasdaq Composite listed technology bigwigs with strong growth potential for the rest of 2022. These stocks have seen positive earnings estimate revisions in the last 90 days. Each of our picks carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
Cadence Design Systemsoffers products and tools that help customers design electronic products. Through the System Design Enablement strategy, CDNS offers software, hardware, services and reusable IC design blocks to electronic systems and semiconductor customers.
Cadence's performance is being driven by strength across segments like digital & signoff solutions and functional verification suite. CDNS is also gaining from higher investments in emerging trends like IoT and autonomous vehicle sub-systems along with strength in the semiconductor end-market. Frequent product launches are expected to help CDNS sustain top-line growth.
Cadence Design Systems has an expected earnings growth rate of 24.9% for the current year. The Zacks Consensus Estimate for current-year earnings improved 5.7% over the last 30 days.
Texas Instrumentsis benefiting from a continued rebound in the automotive market. A solid demand environment in the industrial end market contributed well. Growing momentum across the communication equipment and enterprise systems markets will benefit TXN in the long haul.
Additionally, the strong performance of Analog and Embedded Processing segments contributed well. Solid investments in new growth avenues and competitive advantages are acting as a tailwind for TXN. Further, the company's portfolio of long-lived products and efficient manufacturing strategies are the other positives.
Texas Instruments has an expected earnings growth rate of 13.2% for the current year. The Zacks Consensus Estimate for current-year earnings improved 6.5% over the last 30 days.
Palo Alto Networks has been benefiting from continuous deal wins and the increasing adoption of its next-generation security platforms, attributable to the rise in the remote work environment and the need for stronger security.
Growing traction in Prisma and Cortex offerings are acting as a tailwind. PANW continues to acquire new customers and increase wallet share with existing customers. Palo Alto Networks' higher sales incentives related to next-generation Security products are likely to continue to negatively impact its bottom line.
PANW has an expected earnings growth rate of 24.3% for the current fiscal-year (ending July 2023). The Zacks Consensus Estimate for current fiscal-year earnings has improved 0.1% over the last 60 days.
Intuit is benefiting from strong momentum in online ecosystem revenues and solid professional tax revenues. The TurboTax Live offering is also driving growth in the Consumer tax business.
Solid momentum in INTU's lending product, QuickBooks Capital, remains a positive. Moreover, Intuit's strategy of shifting its business to a cloud-based subscription model will help generate stable revenues over the long run.
Intuit has an expected earnings growth rate of 16.3% for the current year (ending July 2023). The Zacks Consensus Estimate for current-year earnings improved 1.2% over the last 90 days.
Fortinet is benefiting from rising demand for security and networking products amid the coronavirus crisis as a huge global workforce is working remotely. FTNT is also benefiting from robust growth in Fortinet Security Fabric, cloud and Software-defined Wide Area Network offerings.
Moreover, continued deal wins, especially those of high value, are solid drivers. Higher IT spending on cybersecurity is further expected to aid Fortinet to grow faster than the security market. Also, focus on enhancing its unified threat management portfolio through product development and acquisitions is a tailwind for FTNT.
Fortinet has an expected earnings growth rate of 30% for the current year. The Zacks Consensus Estimate for current-year earnings improved 2% over the last 30 days.
Why Haven't You Looked at Zacks' Top Stocks?
Our 5 best-performing strategies have blown away the S&P's impressive +28.8% gain in 2021. Amazingly, they soared+40.3%, +48.2%, +67.6%, +94.4%, and+95.3%. Today you can access their live picks without cost or obligation.
See Stocks Free >>
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
https://www.zacks.com
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.