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Steel Dynamics and Hasbro have been highlighted as Zacks Bull and Bear of the Day
Read MoreHide Full Article
For Immediate Release
Chicago, IL – December 21, 2022 – Zacks Equity Research shares Steel Dynamics (STLD - Free Report) as the Bull of the Day and Hasbro (HAS - Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Manchester United plc (MANU - Free Report) and Bowlero Corp. (BOWL - Free Report) .
Steel Dynamics is a Zacks Rank #1 (Strong Buy) and it sports a A for Value and a B for Growth. This steel producer has been super strong since early October back when the stock was $70. Recently, we have seen a pull back from highs that were above $113. Let's explore more about this company in this Bull of The Day article.
Description
Based in Fort Wayne, IN, Steel Dynamics, Inc. is among the leading steel producers and metal recyclers in the United States. It currently has steelmaking and coating capacity of more than 11 million tons. It is one of the most diversified steel companies in the United States with a vast range of specialty products. The company makes and markets steel products, processes and sells recycled ferrous and nonferrous metals, and fabricates and sells steel joist and decking products in the United States and internationally.
Earnings History
When I look at a stock, the first thing I do is look to see if the company is beating the number. This tells me right away where the market's expectations have been for the company and how management has communicated to the market. A stock that consistently beats has management communicating expectations to Wall Street that can be achieved. That is what you want to see.
For STDL, I see four straight beats of the Zacks Consensus Estimate. That is great to see, but by itself that is not enough to make the company a Zacks Rank #1 (Strong Buy).
The average positive earnings surprise over the course of the last year works out to be 6.2%.
Earnings Estimates Revisions
The Zacks Rank tells us which stocks are seeing earnings estimates move higher.
Over the last 60 days, earning estimates have moved up for STLD.
This quarter has moved up from $3.34 to $3.78.
Next quarter has increased from $3.12 to $3.26.
The full fiscal year 2022 has increased from $20.95 to $21.89.
Next fiscal year has seen the estimate move from $7.86 to $9.49.
Positive movement in earnings helped move this stock to a Zacks Rank #1 (Strong Buy).
Valuation
The valuation for this name is low even with the solid growth I see a forward PE of 4.6x which is very low, but the company is coming off a quarter that saw topline growth of more than 11%. The price to book multiple is 2.3x. Price to sales comes in at 0.8x while the stock carries operating margins of roughly 20%.
Hasbro is a Zacks Rank #5 (Strong Sell) after recently missing earnings. The November retail sales report came in awfully weak so it is not surprising to see analysts taking down estimates of select consumer goods names ahead of the holiday. This article will look at why this stock is a Zacks Rank #5 (Strong Sell) as it is the Bear of the Day.
Description
Hasbro, Inc., operates as a play and entertainment company. Its Consumer Products segment engages in the sourcing, marketing, and sale of toy and game products. Its toys and games include action figures, arts and crafts and creative play products, fashion and other dolls, play sets, preschool toys, plush products, sports action blasters and accessories, vehicles and toy-related specialty products. The company's Wizards of the Coast and Digital Gaming segment engages in the promotion of its brands through the development of trading card, role-playing, and digital game experiences based on Hasbro and Wizards of the Coast games. Hasbro, Inc. was founded in 1923 and is headquartered in Pawtucket, Rhode Island.
Earnings History
When I look at a stock, the first thing I do is look to see if the company is beating the number. This tells me right away where the market's expectations have been for the company and how management has communicated to the market. A stock that consistently beats has management communicating expectations to Wall Street that can be achieved. That is what you want to see.
In the case of HAS, it has two beats over the Zacks Consensus Estimate and two misses. This alone does not make the stock a Zacks Rank #1 (Strong Buy) and it doesn't make it a Zacks Rank #5 (Strong Sell) either.
The Zacks Rank does care about the earnings history, but it is much more heavily influenced by the movement of earnings estimates.
Earnings Estimates
The Zacks Rank tells us which stocks are seeing earnings estimates move higher or in this case lower. For HAS I see annual estimates moving lower of late.
The current fiscal year consensus number moved lower from $4.75 to $4.66 over the last 60 days.
The next year has moved from $5.37 to $5.14. That move lower is probably the biggest deciding factor for this stock to be a Zacks Rank #5 (Strong Sell).
Negative movement in earnings estimates like that is why this stock is a Zacks Rank #5 (Strong Sell).
It should be noted that a majority of stocks in the Zacks universe are seeing negative earnings estimate revisions. That means that the stocks that are seeing small but negative earnings estimate revisions are falling to a Zacks Rank #5 (Strong Sell).
Additional content:
2 Entertainment Stocks with Over 35% Gains and More Room to Run
Most entertainment stocks gradually overcame the pandemic-induced uncertainties this year. The entertainment industry is riding a wave of tremendous opportunity owing to technological innovations, evolving generational behaviors and pandemic-led behavioral changes. While demand for entertainment content has been resilient during periods of economic uncertainty, the continued impacts of inflation might dampen their performances.
With the average U.S. household subscribing to almost five streaming services, it is clear that consumers have to stack these services to access the content they want. To support this trend, streamers have increased their investment in original programming and are passing these costs to the customers. Consequently, the average monthly subscription fees of stack services are approaching the cost of cable. Also, certain companies are focused on integrating gaming and live sports streaming to drive growth.
Although there is ongoing friction and fragmentation of streaming services and content, industry players are emphasizing on rationalization of marketing spend and optimization of content slate and distribution approach to deliver a steady state of high-impact releases. This paves a path for efficiency in customer engagement as well as drive subscriber acquisition.
We believe that emphasis on unit economics by aggregating the best sports and entertainment content, customer engagement (to drive advertising sales) and offerings of additional content and features (without overshooting costs) are likely to act as key catalysts for growth in the upcoming periods.
2 Top Stocks to Watch
Although economic uncertainty prevails due to inflationary pressures, it would be appropriate for investors to focus on these fundamentally-sound stocks. Investors can keep an eye on the following entertainment stocks that have performed well and are expected to continue the winning streak in the upcoming year.
We have shortlisted two entertainment stocks with the help of the Zacks Stock Screener, carrying a Zacks Rank #2 (Buy) and gaining more than 35% so far this year. These stocks have outperformed their respective industries and the broader Leisure sector so far this year. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Manchester United plcv has shown strong momentum in commercial operations, reflecting both the welcome return of match-going fans to the stadium after the pandemic and the strength of its venue, merchandising and partnership operations. Despite global economic headwinds, the company remains optimistic on account of global TV rights for the Premier League and UEFA competitions.
Also, a competitive sponsorship market with many new market entrants looking to build and strengthen their brand through associations acts as a tailwind. In terms of digital activity, the company continues to witness growth in the global reach of the club media content across owned and operated channels and all the major social media platforms. The company expects continued growth backed by its fan engagement initiatives, infrastructure upgrades and maintenance projects.
Manchester United currently carries a Zacks Rank #2 and has gained 49.4% so far this year. For fiscal 2023, the loss estimates have improved 30.8% in the past 60 days, narrowing from a loss of 52 cents per share to a loss of 36 cents.
Bowlero Corp. is poised to benefit from pent-up demand, algorithmically powered management system (QMS), center acquisitions and cost control discipline. Since the start of fiscal 2022, the company has added 38 new centers to its portfolio, reflecting a growth of approximately 10% annually. Also, it reported solid performance with respect to the same.
Meanwhile, the company emphasized on the initiation of a pilot of a skill-based gamification app - Money Ball. The initiative focuses on the performance of its centers by deepening engagement with its guests courtesy of bowls and challenges for cash or other prizes depending on the location. Money Ball uses proprietary algorithms to determine odds on certain challenges, ranging in difficulty from as easy as breaking 100 to as difficult as bowling and exact score.
The company remains optimistic in this regard and anticipates the initiative to drive visitor frequency in centers and enhance the guest experience. Also, vis-à-vis event and league support the company's top-line growth through the fiscal year 2023.
Bowlero currently carries a Zacks Rank #2 and has gained 38.8% this year. For fiscal 2023, Bowlero's earnings estimates have increased 1.9% in the past 60 days to 54 cents per share. The consensus mark for sales reflect growth of 11.5% on a year-over-year basis.
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.
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
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/performancefor information about the performance numbers displayed in this press release.
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Steel Dynamics and Hasbro have been highlighted as Zacks Bull and Bear of the Day
For Immediate Release
Chicago, IL – December 21, 2022 – Zacks Equity Research shares Steel Dynamics (STLD - Free Report) as the Bull of the Day and Hasbro (HAS - Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Manchester United plc (MANU - Free Report) and Bowlero Corp. (BOWL - Free Report) .
Here is a synopsis of all four stocks:
Bull of the Day:
Steel Dynamics is a Zacks Rank #1 (Strong Buy) and it sports a A for Value and a B for Growth. This steel producer has been super strong since early October back when the stock was $70. Recently, we have seen a pull back from highs that were above $113. Let's explore more about this company in this Bull of The Day article.
Description
Based in Fort Wayne, IN, Steel Dynamics, Inc. is among the leading steel producers and metal recyclers in the United States. It currently has steelmaking and coating capacity of more than 11 million tons. It is one of the most diversified steel companies in the United States with a vast range of specialty products. The company makes and markets steel products, processes and sells recycled ferrous and nonferrous metals, and fabricates and sells steel joist and decking products in the United States and internationally.
Earnings History
When I look at a stock, the first thing I do is look to see if the company is beating the number. This tells me right away where the market's expectations have been for the company and how management has communicated to the market. A stock that consistently beats has management communicating expectations to Wall Street that can be achieved. That is what you want to see.
For STDL, I see four straight beats of the Zacks Consensus Estimate. That is great to see, but by itself that is not enough to make the company a Zacks Rank #1 (Strong Buy).
The average positive earnings surprise over the course of the last year works out to be 6.2%.
Earnings Estimates Revisions
The Zacks Rank tells us which stocks are seeing earnings estimates move higher.
Over the last 60 days, earning estimates have moved up for STLD.
This quarter has moved up from $3.34 to $3.78.
Next quarter has increased from $3.12 to $3.26.
The full fiscal year 2022 has increased from $20.95 to $21.89.
Next fiscal year has seen the estimate move from $7.86 to $9.49.
Positive movement in earnings helped move this stock to a Zacks Rank #1 (Strong Buy).
Valuation
The valuation for this name is low even with the solid growth I see a forward PE of 4.6x which is very low, but the company is coming off a quarter that saw topline growth of more than 11%. The price to book multiple is 2.3x. Price to sales comes in at 0.8x while the stock carries operating margins of roughly 20%.
Bear of the Day:
Hasbro is a Zacks Rank #5 (Strong Sell) after recently missing earnings. The November retail sales report came in awfully weak so it is not surprising to see analysts taking down estimates of select consumer goods names ahead of the holiday. This article will look at why this stock is a Zacks Rank #5 (Strong Sell) as it is the Bear of the Day.
Description
Hasbro, Inc., operates as a play and entertainment company. Its Consumer Products segment engages in the sourcing, marketing, and sale of toy and game products. Its toys and games include action figures, arts and crafts and creative play products, fashion and other dolls, play sets, preschool toys, plush products, sports action blasters and accessories, vehicles and toy-related specialty products. The company's Wizards of the Coast and Digital Gaming segment engages in the promotion of its brands through the development of trading card, role-playing, and digital game experiences based on Hasbro and Wizards of the Coast games. Hasbro, Inc. was founded in 1923 and is headquartered in Pawtucket, Rhode Island.
Earnings History
When I look at a stock, the first thing I do is look to see if the company is beating the number. This tells me right away where the market's expectations have been for the company and how management has communicated to the market. A stock that consistently beats has management communicating expectations to Wall Street that can be achieved. That is what you want to see.
In the case of HAS, it has two beats over the Zacks Consensus Estimate and two misses. This alone does not make the stock a Zacks Rank #1 (Strong Buy) and it doesn't make it a Zacks Rank #5 (Strong Sell) either.
The Zacks Rank does care about the earnings history, but it is much more heavily influenced by the movement of earnings estimates.
Earnings Estimates
The Zacks Rank tells us which stocks are seeing earnings estimates move higher or in this case lower. For HAS I see annual estimates moving lower of late.
The current fiscal year consensus number moved lower from $4.75 to $4.66 over the last 60 days.
The next year has moved from $5.37 to $5.14. That move lower is probably the biggest deciding factor for this stock to be a Zacks Rank #5 (Strong Sell).
Negative movement in earnings estimates like that is why this stock is a Zacks Rank #5 (Strong Sell).
It should be noted that a majority of stocks in the Zacks universe are seeing negative earnings estimate revisions. That means that the stocks that are seeing small but negative earnings estimate revisions are falling to a Zacks Rank #5 (Strong Sell).
Additional content:
2 Entertainment Stocks with Over 35% Gains and More Room to Run
Most entertainment stocks gradually overcame the pandemic-induced uncertainties this year. The entertainment industry is riding a wave of tremendous opportunity owing to technological innovations, evolving generational behaviors and pandemic-led behavioral changes. While demand for entertainment content has been resilient during periods of economic uncertainty, the continued impacts of inflation might dampen their performances.
With the average U.S. household subscribing to almost five streaming services, it is clear that consumers have to stack these services to access the content they want. To support this trend, streamers have increased their investment in original programming and are passing these costs to the customers. Consequently, the average monthly subscription fees of stack services are approaching the cost of cable. Also, certain companies are focused on integrating gaming and live sports streaming to drive growth.
Although there is ongoing friction and fragmentation of streaming services and content, industry players are emphasizing on rationalization of marketing spend and optimization of content slate and distribution approach to deliver a steady state of high-impact releases. This paves a path for efficiency in customer engagement as well as drive subscriber acquisition.
We believe that emphasis on unit economics by aggregating the best sports and entertainment content, customer engagement (to drive advertising sales) and offerings of additional content and features (without overshooting costs) are likely to act as key catalysts for growth in the upcoming periods.
2 Top Stocks to Watch
Although economic uncertainty prevails due to inflationary pressures, it would be appropriate for investors to focus on these fundamentally-sound stocks. Investors can keep an eye on the following entertainment stocks that have performed well and are expected to continue the winning streak in the upcoming year.
We have shortlisted two entertainment stocks with the help of the Zacks Stock Screener, carrying a Zacks Rank #2 (Buy) and gaining more than 35% so far this year. These stocks have outperformed their respective industries and the broader Leisure sector so far this year. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Manchester United plcv has shown strong momentum in commercial operations, reflecting both the welcome return of match-going fans to the stadium after the pandemic and the strength of its venue, merchandising and partnership operations. Despite global economic headwinds, the company remains optimistic on account of global TV rights for the Premier League and UEFA competitions.
Also, a competitive sponsorship market with many new market entrants looking to build and strengthen their brand through associations acts as a tailwind. In terms of digital activity, the company continues to witness growth in the global reach of the club media content across owned and operated channels and all the major social media platforms. The company expects continued growth backed by its fan engagement initiatives, infrastructure upgrades and maintenance projects.
Manchester United currently carries a Zacks Rank #2 and has gained 49.4% so far this year. For fiscal 2023, the loss estimates have improved 30.8% in the past 60 days, narrowing from a loss of 52 cents per share to a loss of 36 cents.
Bowlero Corp. is poised to benefit from pent-up demand, algorithmically powered management system (QMS), center acquisitions and cost control discipline. Since the start of fiscal 2022, the company has added 38 new centers to its portfolio, reflecting a growth of approximately 10% annually. Also, it reported solid performance with respect to the same.
Meanwhile, the company emphasized on the initiation of a pilot of a skill-based gamification app - Money Ball. The initiative focuses on the performance of its centers by deepening engagement with its guests courtesy of bowls and challenges for cash or other prizes depending on the location. Money Ball uses proprietary algorithms to determine odds on certain challenges, ranging in difficulty from as easy as breaking 100 to as difficult as bowling and exact score.
The company remains optimistic in this regard and anticipates the initiative to drive visitor frequency in centers and enhance the guest experience. Also, vis-à-vis event and league support the company's top-line growth through the fiscal year 2023.
Bowlero currently carries a Zacks Rank #2 and has gained 38.8% this year. For fiscal 2023, Bowlero's earnings estimates have increased 1.9% in the past 60 days to 54 cents per share. The consensus mark for sales reflect growth of 11.5% on a year-over-year basis.
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 >>
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Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
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/performancefor information about the performance numbers displayed in this press release.