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Deere and CarMax have been highlighted as Zacks Bull and Bear of the Day
Read MoreHide Full Article
For Immediate Release
Chicago, IL – February 27, 2023 – Zacks Equity Research shares Deere & Company (DE - Free Report) as the Bull of the Day and CarMax (KMX - Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on NVIDIA (NVDA - Free Report) , Tesla (TSLA - Free Report) and Warner Bros. Discovery (WBD - Free Report) .
The Zacks Industrial Products sector is currently ranked #1 out of all 16 Zacks sectors, indicating that companies within the realm have witnessed positive earnings estimate revisions.
And as we’re all aware, 50% of a stock's price movement can be attributed to its group, reflecting the importance of targeting stocks in sectors with bright outlooks.
One company in the sector, Deere & Company, has been no exception, currently sporting the highly-coveted Zacks Rank #1 (Strong Buy).
Illinois-based Deere is the world’s largest producer of agricultural equipment, manufacturing agricultural machinery since 1837 under the iconic John Deere brand with its signature green and yellow color scheme.
Let’s take a deeper dive into the company.
Valuation
DE shares aren’t pricey in terms of valuation, with its current 15.1X forward earnings multiple sitting beneath the five-year median and Zacks Industrial Products sector average.
In addition, the company’s forward price-to-sales currently works out to be 2.4X, modestly above the five-year median and again below the Zacks sector average.
Strong Growth
Deere certainly sports a favorable growth profile, with the Zacks Consensus EPS Estimate of $29.82 for its current fiscal year (FY23) suggesting year-over-year growth of nearly 30%. And in FY24, estimates allude to a further 4% of earnings growth.
The projected earnings growth comes on the back of forecasted year-over-year revenue upticks of 13% in FY23 and 1.6% in FY24.
Quarterly Performance
DE has consistently posted better-than-expected results as of late, exceeding both earnings and revenue estimates in back-to-back quarters.
Just in its latest release, the agriculture titan registered a sizable 18% EPS beat and reported sales 1% above expectations.
Dividends
And for the cherry on top, DE shares pay a dividend, currently yielding 1.1% annually.
While the yield is below the Zacks sector average, Deere’s 13% five-year annualized dividend growth rate bridges the gap in a big way.
Bottom Line
Investors can implement a stellar strategy to find expected winners by taking advantage of the Zacks Rank – one of the most powerful market tools that provides a massive edge.
Additionally, the top 5% of all stocks receive the highly coveted Zacks Rank #1 (Strong Buy). These stocks should outperform the market more than any other rank.
Deere & Co.would be an excellent stock for investors to keep on their watchlists, as displayed by its Zack Rank #1 (Strong Buy).
Stocks have staged a strong rebound in 2023, a welcomed development following a forgettable 2022.
In addition, many of them have seen their earnings outlooks drift higher so far in the year, but the same can’t be said for CarMax.
The company currently sports a Zacks Rank #5 (Strong Sell), with earnings revisions heading entirely in the wrong direction.
CarMax is the largest retailer of used vehicles in the U.S. and one of the nation's largest operators of wholesale vehicle auctions. The company operates under two reportable segments: CarMax Sales Operations and CarMax Auto Finance (CAF).
Let’s take a closer look at how the company currently stacks up.
Valuation
Presently, KMX shares trade at a 24.4X forward earnings multiple, above the 16.8X five-year median by a notable margin and the Zacks Retail and Wholesale sector average.
In addition, the company’s forward price-to-sales works out to be a small 0.4X, below the five-year median of 0.7X and the Zacks sector average.
The stock carries a Style Score of “C” for Value.
Growth Outlook
KMX is slated to take a growth hit, with estimates for its current fiscal year (FY23) indicating a 60% pullback in earnings and a 6% drop in revenue.
Earnings growth resumes in FY24, with the Zacks Consensus EPS Estimate of $2.93 suggesting a 4% increase in the bottom line year-over-year.
Quarterly Performance
CarMax has recently struggled to exceed quarterly estimates, falling short of earnings and revenue estimates in back-to-back quarters.
Just in its latest release, KMX fell short of earnings expectations by nearly 60% and reported sales 10% below expectations.
Bottom Line
Negative earnings estimate revisions and weak quarterly results paint a less-than-ideal picture for the company in the short term.
CarMax is a Zacks Rank #5 (Strong Sell), telling us it has a weak near-term earnings outlook.
Investors should pivot to stocks that either carry a Zacks Rank #1 (Strong Buy) or Zacks Rank #2 (Buy) – these stocks have a much stronger earnings outlook and potential to deliver explosive gains in the short term.
Additional content:
Buyers Can't Get Enough of These 3 Stocks So Far This Year
As February begins to fade, one thing is certain – the first few months of 2023 have been much different from what was endured last year.
Many of those that were punished in 2022 have staged big rebounds, including NVIDIA, Tesla and Warner Bros. Discovery.
In fact, all three are the top-performing S&P 500 stocks year-to-date. For those interested in momentum investing, let’s take a closer look at each one.
Tesla
We’re all highly familiar with Tesla, the undisputed EV leader and one of the most popular stocks over the last decade.
Shares were heavily punished in 2022, losing more than 60% in value. However, the company’s latest quarterly release pushed new life into shares.
Tesla posted better-than-expected results, penciling in a 9% bottom line beat and reporting revenue 2.5% ahead of expectations.
In addition, total EV deliveries for the quarter, a critical metric for the company, totaled roughly 405,000, 1% ahead of our consensus estimate.
TSLA shares presently trade at a 6.2X forward price-to-sales ratio (F1), a few ticks below the 6.6X five-year median and beneath steep highs of 23.5X in 2022.
The stock presently carries a Style Score of “C” for Value.
NVIDIA
Another investor favorite, NVIDIA, is the worldwide leader in visual computing technologies, evolving its focus from PC graphics to artificial intelligence (AI) solutions.
NVIDIA’s latest quarterly release was undoubtedly welcomed by the market, with shares gaining more than 10% following the print.
NVIDIA reported earnings of $0.88 per share, handily beating our consensus estimate by nearly 9%.
In addition, quarterly revenue totaled $6.1 billion, modestly ahead of expectations and declining 20% year-over-year, primarily attributed to a pullback in gaming demand.
However, a big focus point of the company’s release was its Data Center results; Data Center revenue totaled $3.6 billion, growing 11% from the year-ago quarter.
There were also several strategic highlights within the Data Center segment, including a partnership with Deutsche Bank to further the use of AI within financial services.
AI is Wall Street’s new shiny toy in 2023, and NVIDIA looks to become the leader.
Warner Bros. Discovery
Warner Bros. Discovery is a media and entertainment company that creates and distributes a portfolio of content and brands across television, film, and streaming.
The company has seen its earnings outlook improve across several timeframes over the last several months.
In its latest release on February 23rd, WBD posted earnings per share of $0.42, crushing the Zacks Consensus EPS Estimate of -$0.03. In addition, the company generated $11 billion in sales, just a tick below expectations.
Still, the most impressive aspect of WBD could be its growth trajectory; the Zacks Consensus EPS Estimate of $0.96 for its current fiscal year (FY23) suggests an improvement of more than 100% year-over-year.
And in FY24, estimates allude to a further 60% of earnings growth.
Bottom Line
Investors have undoubtedly welcomed the broader market’s rebound in 2023.
All three of these stocks have led the S&P 500’s rebound, finding plenty of buyers year-to-date. For those interested in momentum investing, all three deserve consideration.
Why Haven’t You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +6.2 average gain per year. Amazingly, they soared with average gains of +46.4%, +49.5% and +55.2% per year. 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/performance for information about the performance numbers displayed in this press release.
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Deere and CarMax have been highlighted as Zacks Bull and Bear of the Day
For Immediate Release
Chicago, IL – February 27, 2023 – Zacks Equity Research shares Deere & Company (DE - Free Report) as the Bull of the Day and CarMax (KMX - Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on NVIDIA (NVDA - Free Report) , Tesla (TSLA - Free Report) and Warner Bros. Discovery (WBD - Free Report) .
Here is a synopsis of all five stocks.
Bull of the Day:
The Zacks Industrial Products sector is currently ranked #1 out of all 16 Zacks sectors, indicating that companies within the realm have witnessed positive earnings estimate revisions.
And as we’re all aware, 50% of a stock's price movement can be attributed to its group, reflecting the importance of targeting stocks in sectors with bright outlooks.
One company in the sector, Deere & Company, has been no exception, currently sporting the highly-coveted Zacks Rank #1 (Strong Buy).
Illinois-based Deere is the world’s largest producer of agricultural equipment, manufacturing agricultural machinery since 1837 under the iconic John Deere brand with its signature green and yellow color scheme.
Let’s take a deeper dive into the company.
Valuation
DE shares aren’t pricey in terms of valuation, with its current 15.1X forward earnings multiple sitting beneath the five-year median and Zacks Industrial Products sector average.
In addition, the company’s forward price-to-sales currently works out to be 2.4X, modestly above the five-year median and again below the Zacks sector average.
Strong Growth
Deere certainly sports a favorable growth profile, with the Zacks Consensus EPS Estimate of $29.82 for its current fiscal year (FY23) suggesting year-over-year growth of nearly 30%. And in FY24, estimates allude to a further 4% of earnings growth.
The projected earnings growth comes on the back of forecasted year-over-year revenue upticks of 13% in FY23 and 1.6% in FY24.
Quarterly Performance
DE has consistently posted better-than-expected results as of late, exceeding both earnings and revenue estimates in back-to-back quarters.
Just in its latest release, the agriculture titan registered a sizable 18% EPS beat and reported sales 1% above expectations.
Dividends
And for the cherry on top, DE shares pay a dividend, currently yielding 1.1% annually.
While the yield is below the Zacks sector average, Deere’s 13% five-year annualized dividend growth rate bridges the gap in a big way.
Bottom Line
Investors can implement a stellar strategy to find expected winners by taking advantage of the Zacks Rank – one of the most powerful market tools that provides a massive edge.
Additionally, the top 5% of all stocks receive the highly coveted Zacks Rank #1 (Strong Buy). These stocks should outperform the market more than any other rank.
Deere & Co.would be an excellent stock for investors to keep on their watchlists, as displayed by its Zack Rank #1 (Strong Buy).
Bear of the Day:
Stocks have staged a strong rebound in 2023, a welcomed development following a forgettable 2022.
In addition, many of them have seen their earnings outlooks drift higher so far in the year, but the same can’t be said for CarMax.
The company currently sports a Zacks Rank #5 (Strong Sell), with earnings revisions heading entirely in the wrong direction.
CarMax is the largest retailer of used vehicles in the U.S. and one of the nation's largest operators of wholesale vehicle auctions. The company operates under two reportable segments: CarMax Sales Operations and CarMax Auto Finance (CAF).
Let’s take a closer look at how the company currently stacks up.
Valuation
Presently, KMX shares trade at a 24.4X forward earnings multiple, above the 16.8X five-year median by a notable margin and the Zacks Retail and Wholesale sector average.
In addition, the company’s forward price-to-sales works out to be a small 0.4X, below the five-year median of 0.7X and the Zacks sector average.
The stock carries a Style Score of “C” for Value.
Growth Outlook
KMX is slated to take a growth hit, with estimates for its current fiscal year (FY23) indicating a 60% pullback in earnings and a 6% drop in revenue.
Earnings growth resumes in FY24, with the Zacks Consensus EPS Estimate of $2.93 suggesting a 4% increase in the bottom line year-over-year.
Quarterly Performance
CarMax has recently struggled to exceed quarterly estimates, falling short of earnings and revenue estimates in back-to-back quarters.
Just in its latest release, KMX fell short of earnings expectations by nearly 60% and reported sales 10% below expectations.
Bottom Line
Negative earnings estimate revisions and weak quarterly results paint a less-than-ideal picture for the company in the short term.
CarMax is a Zacks Rank #5 (Strong Sell), telling us it has a weak near-term earnings outlook.
Investors should pivot to stocks that either carry a Zacks Rank #1 (Strong Buy) or Zacks Rank #2 (Buy) – these stocks have a much stronger earnings outlook and potential to deliver explosive gains in the short term.
Additional content:
Buyers Can't Get Enough of These 3 Stocks So Far This Year
As February begins to fade, one thing is certain – the first few months of 2023 have been much different from what was endured last year.
Many of those that were punished in 2022 have staged big rebounds, including NVIDIA, Tesla and Warner Bros. Discovery.
In fact, all three are the top-performing S&P 500 stocks year-to-date. For those interested in momentum investing, let’s take a closer look at each one.
Tesla
We’re all highly familiar with Tesla, the undisputed EV leader and one of the most popular stocks over the last decade.
Shares were heavily punished in 2022, losing more than 60% in value. However, the company’s latest quarterly release pushed new life into shares.
Tesla posted better-than-expected results, penciling in a 9% bottom line beat and reporting revenue 2.5% ahead of expectations.
In addition, total EV deliveries for the quarter, a critical metric for the company, totaled roughly 405,000, 1% ahead of our consensus estimate.
TSLA shares presently trade at a 6.2X forward price-to-sales ratio (F1), a few ticks below the 6.6X five-year median and beneath steep highs of 23.5X in 2022.
The stock presently carries a Style Score of “C” for Value.
NVIDIA
Another investor favorite, NVIDIA, is the worldwide leader in visual computing technologies, evolving its focus from PC graphics to artificial intelligence (AI) solutions.
NVIDIA’s latest quarterly release was undoubtedly welcomed by the market, with shares gaining more than 10% following the print.
NVIDIA reported earnings of $0.88 per share, handily beating our consensus estimate by nearly 9%.
In addition, quarterly revenue totaled $6.1 billion, modestly ahead of expectations and declining 20% year-over-year, primarily attributed to a pullback in gaming demand.
However, a big focus point of the company’s release was its Data Center results; Data Center revenue totaled $3.6 billion, growing 11% from the year-ago quarter.
There were also several strategic highlights within the Data Center segment, including a partnership with Deutsche Bank to further the use of AI within financial services.
AI is Wall Street’s new shiny toy in 2023, and NVIDIA looks to become the leader.
Warner Bros. Discovery
Warner Bros. Discovery is a media and entertainment company that creates and distributes a portfolio of content and brands across television, film, and streaming.
The company has seen its earnings outlook improve across several timeframes over the last several months.
In its latest release on February 23rd, WBD posted earnings per share of $0.42, crushing the Zacks Consensus EPS Estimate of -$0.03. In addition, the company generated $11 billion in sales, just a tick below expectations.
Still, the most impressive aspect of WBD could be its growth trajectory; the Zacks Consensus EPS Estimate of $0.96 for its current fiscal year (FY23) suggests an improvement of more than 100% year-over-year.
And in FY24, estimates allude to a further 60% of earnings growth.
Bottom Line
Investors have undoubtedly welcomed the broader market’s rebound in 2023.
All three of these stocks have led the S&P 500’s rebound, finding plenty of buyers year-to-date. For those interested in momentum investing, all three deserve consideration.
Why Haven’t You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +6.2 average gain per year. Amazingly, they soared with average gains of +46.4%, +49.5% and +55.2% per year. Today you can access their live picks without cost or obligation.
See Stocks Free >>
Media Contact
Zacks Investment Research
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https://www.zacks.com
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/performance for information about the performance numbers displayed in this press release.