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The Zacks Analyst Blog Highlights Netflix, Intuitive Surgical, Lockheed Martin and United Airlines
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For Immediate Release
Chicago, IL – October 20, 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: Netflix (NFLX - Free Report) , Intuitive Surgical (ISRG - Free Report) , Lockheed Martin (LMT - Free Report) and United Airlines (UAL - Free Report) .
Here are highlights from Wednesday’s Analyst Blog:
These Stocks Have Popped: Here's Why
As the Q3 earnings season gathers momentum, investors appear to be handsomely rewarding the companies that improve their revenue and earnings, provided there are also signs of improved visibility.
Here is a group of companies that were rewarded this week: Netflix shares jumped 13.8%, Intuitive Surgical 12.1%, Lockheed Martin 8.7%, and United Airlines 7.0%. Let’s see why-
Netflix
Netflix reported earnings of $3.10 per share that came in higher than the $2.11 estimated. Revenue came in about 1% higher than estimated.
The results may have been much better if it wasn’t for the strong dollar, which significantly impacted inflows from its international business. Investors cheered the fact that memberships continued to grow even if it was mainly driven by Asia, signaling that the pandemic-related disruption was probably over.
In the earnings release, management highlighted how Amazon and Disney lagged Netflix in engagement, both in the UK and the U.S. But competition is clearly heating up across geographies. Some on the street are saying that the lower-priced ad-supported plan is designed to target an increasingly competitive market. Others have argued the lack of sense in paying for a plan that comes with ads. But management remains optimistic about the launch next month. We’ll have to see how it goes.
Netflix is clearly better positioned than its peers today because they are in the initial investment phase and management is probably right in guessing that they’re making huge losses.
Intuitive Surgical
Intuitive Surgical’s earnings missed estimates by 1.1% but its sales beat by 2.2%.
Investors piled into the shares after management stated that the company’s business fundamentals strengthened in the third quarter, as reflected by the growth in its installed base, increases in utilization per system per year and solid performance across geographies.
General surgery was the strongest in the U.S.; Europe continued to grow and diversify with particular strength in Germany, the U.K. and Ireland, Italy, and Spain. Asia was also very strong. Despite the COVID-related shut-downs in China, procedure growth in the region did slightly better than the global average. Japan and South Korea also grew strongly.
Lockheed Martin
Lockheed Martin’s reported earnings of $6.87 beat the Zacks Consensus Estimate by 4.1%. Revenue missed by 1.4%.
The Aeronautics segment was the biggest driver of profit, along with the Space segment. Management attributed the increase in cash flows to the “timing of production and billing cycles (primarily the F-35 program” ($325 million of sales from the previous quarter was recognized in the last quarter). Demand remains strong but revenue continues to be impacted by supply chain issues.
Lockheed returns value to investors through dividends and share repurchases. The quarterly dividend was increased substantially (by $0.20 to $3.00 per share). Including the increase, the dividend yields 2.7%.
Management expects 2023 sales to be consistent with 2022 with growth returning in 2024.
United Airlines
United Airlines’ earnings beat the Zacks Consensus Estimate by 27.2% on sales that beat by 1.3%.
Better still, management said that Q4 revenue grew 13.2% over 2019 levels, total revenue per available seat mile (TRASM) grew 25.5% and even costs came in lower than expected. Additionally, holiday demand in the current quarter is expected to exceed 2019 levels as well.
General industry commentary was very positive, and similar to Delta, which reported earlier: “air travel is still in the COVID recovery phase, hybrid work gives customers the freedom and flexibility to travel for leisure more often, and external supply challenges will limit industry supply for years to come.” Management believes these trends will offset the effects of economic headwinds.
Netflix, Intuitive Surgical and Lockheed Martin carry #3 Zacks Ranks, which translates to a Hold Rating. United Airlines is ranked #2 (Buy).
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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.
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The Zacks Analyst Blog Highlights Netflix, Intuitive Surgical, Lockheed Martin and United Airlines
For Immediate Release
Chicago, IL – October 20, 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: Netflix (NFLX - Free Report) , Intuitive Surgical (ISRG - Free Report) , Lockheed Martin (LMT - Free Report) and United Airlines (UAL - Free Report) .
Here are highlights from Wednesday’s Analyst Blog:
These Stocks Have Popped: Here's Why
As the Q3 earnings season gathers momentum, investors appear to be handsomely rewarding the companies that improve their revenue and earnings, provided there are also signs of improved visibility.
Here is a group of companies that were rewarded this week: Netflix shares jumped 13.8%, Intuitive Surgical 12.1%, Lockheed Martin 8.7%, and United Airlines 7.0%. Let’s see why-
Netflix
Netflix reported earnings of $3.10 per share that came in higher than the $2.11 estimated. Revenue came in about 1% higher than estimated.
The results may have been much better if it wasn’t for the strong dollar, which significantly impacted inflows from its international business. Investors cheered the fact that memberships continued to grow even if it was mainly driven by Asia, signaling that the pandemic-related disruption was probably over.
In the earnings release, management highlighted how Amazon and Disney lagged Netflix in engagement, both in the UK and the U.S. But competition is clearly heating up across geographies. Some on the street are saying that the lower-priced ad-supported plan is designed to target an increasingly competitive market. Others have argued the lack of sense in paying for a plan that comes with ads. But management remains optimistic about the launch next month. We’ll have to see how it goes.
Netflix is clearly better positioned than its peers today because they are in the initial investment phase and management is probably right in guessing that they’re making huge losses.
Intuitive Surgical
Intuitive Surgical’s earnings missed estimates by 1.1% but its sales beat by 2.2%.
Investors piled into the shares after management stated that the company’s business fundamentals strengthened in the third quarter, as reflected by the growth in its installed base, increases in utilization per system per year and solid performance across geographies.
General surgery was the strongest in the U.S.; Europe continued to grow and diversify with particular strength in Germany, the U.K. and Ireland, Italy, and Spain. Asia was also very strong. Despite the COVID-related shut-downs in China, procedure growth in the region did slightly better than the global average. Japan and South Korea also grew strongly.
Lockheed Martin
Lockheed Martin’s reported earnings of $6.87 beat the Zacks Consensus Estimate by 4.1%. Revenue missed by 1.4%.
The Aeronautics segment was the biggest driver of profit, along with the Space segment. Management attributed the increase in cash flows to the “timing of production and billing cycles (primarily the F-35 program” ($325 million of sales from the previous quarter was recognized in the last quarter). Demand remains strong but revenue continues to be impacted by supply chain issues.
Lockheed returns value to investors through dividends and share repurchases. The quarterly dividend was increased substantially (by $0.20 to $3.00 per share). Including the increase, the dividend yields 2.7%.
Management expects 2023 sales to be consistent with 2022 with growth returning in 2024.
United Airlines
United Airlines’ earnings beat the Zacks Consensus Estimate by 27.2% on sales that beat by 1.3%.
Better still, management said that Q4 revenue grew 13.2% over 2019 levels, total revenue per available seat mile (TRASM) grew 25.5% and even costs came in lower than expected. Additionally, holiday demand in the current quarter is expected to exceed 2019 levels as well.
General industry commentary was very positive, and similar to Delta, which reported earlier: “air travel is still in the COVID recovery phase, hybrid work gives customers the freedom and flexibility to travel for leisure more often, and external supply challenges will limit industry supply for years to come.” Management believes these trends will offset the effects of economic headwinds.
Netflix, Intuitive Surgical and Lockheed Martin carry #3 Zacks Ranks, which translates to a Hold Rating. United Airlines is ranked #2 (Buy).
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.
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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.