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The Zacks Analyst Blog Highlights HSBC, Shopify, Sherwin Williams and Workday
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For Immediate Release
Chicago, IL – August 1, 2023 – 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: HSBC (HSBC - Free Report) , Shopify (SHOP - Free Report) , Sherwin Williams (SHW - Free Report) and Workday (WDAY - Free Report) .
Here are highlights from Monday’s Analyst Blog:
U.S. Non-Farm Payrolls: Global Week Ahead
In the Global Week Ahead, the Bank of England (BoE) is the last of the big central banks to meet before the summer break gets truly underway.
Useful Eurozone Q2 GDP data, Friday's U.S. July nonfarm jobs numbers, and rumblings from the mainland China property sector will keep global markets busy.
As the S&P500's Q2-23 earnings season winds down.
Next are Reuters' five world market themes, reordered for equity traders—
(1) Mainland China Hopes for Stimulus from the Central Government
Hopes for stimulus from Beijing for China's embattled property sector are well and alive, if property shares in Hong Kong and the mainland at multi-week highs are anything to go by.
Removing the phrase "houses are for living, not for speculation" from a readout of the powerful politburo meeting fueled those hopes, but there's been a distinct lack of concrete detail.
A booming property market is seen as key to igniting lackluster missing consumer spending in post-pandemic China. But Beijing will be wary. Memories of previous property sector bubbles are fresh and developers are still feeling the fallout.
Sino-Ocean Group is considering a debt deferral, Dalian Wanda Commercial Management almost defaulted, and Country Garden faces mounting payment pressures in the coming months.
Purchasing manager surveys in days to come are likely to offer few promising signs, after Thursday's industrial profits numbers extend the double-digit pace of declines into a sixth month.
(2) Starting on Monday, Eurozone Macro Data Comes Out
Markets are impatient. The ECB just hiked rates — as expected — again and the 'will they' or 'won't they' lift rates in September debate is well underway.
So even as rate-setters head for a break, data will still push around rate bets, starting with Monday's preliminary estimate of July Eurozone inflation and second quarter GDP.
Overall inflation is now just half its October peak, but harder-to-break underlying price growth is hovering near historic highs and may have even accelerated again. Both measures remain above the ECB's +2.0% inflation target.
Economists polled by Reuters forecast the Eurozone economy grew +0.2% in Q2. GDP was flat in Q1 versus the previous quarter.
The data could strengthen the case for a September hike.
"Not so fast," ECB doves might argue.
After all, forward-looking indicators such as PMIs are pointing decidedly lower.
(3) On Tuesday, HSBC Will Close Out a Mixed European Earnings Season for Big Banks
HSBC on Tuesday closes out a mixed reporting season for big European banks, with investment banking revenues still dwindling as deal activity slumps, while rising rates lift more staid business lines such as corporate and retail banking.
Investors are hoping for a fresh share buyback after HSBC announced a $2 billion offer last quarter and resumed paying quarterly dividends for the first time since 2019. They will also look for an increase to the bank's conservative-looking $34 billion net interest income forecast.
HSBC investors have long awaited the promised land, where rising central bank interest rates lift margins from lending against its vast deposit base, but the picture is clouded in Britain by political pressure to pay stressed savers more.
And China's precarious economic recovery could in turn revive fears about HSBC's nearly $10 billion exposure to the overextended commercial real state sector.
(4) On Wednesday, August 2nd, the Bank of England (BoE) Sets Monetary Policy
When the Bank of England meets on Aug 2nd, policymakers will finally have something to cheer about. Inflation hasn't accelerated since February and there are signs that widespread price pressures are starting to abate.
But the BoE has been routinely accused of being behind the curve. It's taken policymakers eight months to bring inflation down to 7.9%, from a peak of 11.1%. It took the ECB half that time to achieve the same rate of decline.
Money markets show traders think the odds are split on a 25-bp or a 50-bp hike.
Investors are all too aware of how much more work the BoE has to do. After all, they're holding the most valuable bullish bet on sterling since 2014.
Meanwhile, markets will also work through the fallout from the Bank of Japan's move on Friday to make its yield curve control policy more flexible and water down its commitment to defend a cap on long-term interest rates.
(5) On Friday, We Get July U.S. Federal Non-farm Payroll Data
The Fed appears to have gone into data-dependent mode after hiking rates 25 bps on Wednesday to 5.25-5.50% — a level last seen just before the 2007 housing crash.
Between now and its next meeting in September, the Fed gets two sets of jobs data — and inflation numbers — to pore over.
First up is July non-farm payrolls on Aug. 4th.
Resilient jobs growth has been a key factor in shaping investors' benign outlook on the U.S. economy, a view that — along with ebbing inflation — has helped drive rallies in stocks and other risk assets this year.
Signs of an overly robust labor market could spark worries that the Fed needs to keep tightening monetary policy to contain inflation. Conversely, a steep drop-off in employment might rekindle recession fears.
Economists polled by Reuters expect the U.S. to have added +184K jobs in non-farm payrolls in July, which would be the lowest since the pandemic recovery started.
Mega-caps Apple and Amazon, meanwhile, are expected to report earnings on Aug. 3rd.
Zacks #1 Rank (STRONG BUY) Stocks
Let's look to large market-cap stocks, ones recovering from the COVID share bubble.
(1) Shopify: This is an Internet Services industry player. The stock price is at $64. There is a current market cap of $81.6B.
I see a Zacks Value score of F, a Zacks Growth score of F, and a Zacks Momentum score of C.
Shopify Inc. provides a multi-tenant, cloud-based, multi-channel commerce platform for small and medium-sized businesses.
Merchants use the company's software to run business across various sales channels, including web and mobile storefronts, physical retail locations, social media storefronts, and marketplaces.
Shopify's platform enables merchants to manage products and inventory, process orders and payments, ship orders, build customer relationships and leverage analytics along with reporting from one integrated back office.
Moreover, Shopify hosts a huge database of merchant and customer interactions.
Merchants leverage this transactional dataset to get meaningful insight into the sales channel growth prospects and consumer behavioral aspects.
This improves their ability to target prospective customers more easily, which drives sales growth.
(2) Sherwin Williams: This is a $277 stock in the Paint and Related Products industry.
This company's stock currently has a market cap of $71.2B.
I see a Zacks Value score of D, a Zacks Growth score of C, and a Zacks Momentum score of A.
The Sherwin-Williams Company is into manufacturing and sales of paints, coatings and related products. Its well-known brands include Dutch Boy, Minwax and Krylon.
The company acquired rival paints maker Valspar.
Sherwin-Williams reports in three operating segments: The Americas Group, The Consumer Brands Group and The Performance Coatings Group.
The Americas Group includes the Paint Stores Group and Latin America Coatings Group. The group produces and sells a wide array of industrial coatings, architectural paint and related products.
The Consumer Brands Group includes the company's Consumer Group and Valspar's Consumer Paints segment.
The Performance Coatings Group includes the company's Global Finishes Group and Valspar's Coatings Group and Valspar's Automotive Refinishes products business.
It sells a wide array of industrial coatings and finishes for industrial wood, general industrial, protective and marine, packaging and automotive, coil and extrusion customers.
(3) Workday: This is a $229 stock found in the Internet Software industry. There is a market cap of $60B.
I see a Zacks Value score of F, a Zacks Growth score of A and a Zacks Momentum score of D.
Workday Inc. is a provider of enterprise-level software solutions for financial management and human resource domains.
The company's cloud-based platform combines finance and HR in a single system that makes it easier for organizations to provide analytical insights and decision support. Notably, organizations ranging from medium-sized businesses to enterprises have opted for Workday solutions.
The company also offers open, standards-based web-services application programming interfaces and pre-built packaged integrations and connectors.
The company also offers applications related to Payroll, Time Tracking, Recruiting, Learning, Planning, Professional Services Automation and Student. Workday offers Adaptive Insights Business Planning Cloud solutions, Workday Prism Analytics, Workday Data-as-a-Service and Workday Marketplace.
Workday serves technology, financial services, business services, healthcare and life sciences, manufacturing, consumer and retail industries, education and government industries.
Final note: The three stocks show poor Zacks Value scores of F, as their shares still look to gain more momentum.
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 HSBC, Shopify, Sherwin Williams and Workday
For Immediate Release
Chicago, IL – August 1, 2023 – 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: HSBC (HSBC - Free Report) , Shopify (SHOP - Free Report) , Sherwin Williams (SHW - Free Report) and Workday (WDAY - Free Report) .
Here are highlights from Monday’s Analyst Blog:
U.S. Non-Farm Payrolls: Global Week Ahead
In the Global Week Ahead, the Bank of England (BoE) is the last of the big central banks to meet before the summer break gets truly underway.
Useful Eurozone Q2 GDP data, Friday's U.S. July nonfarm jobs numbers, and rumblings from the mainland China property sector will keep global markets busy.
As the S&P500's Q2-23 earnings season winds down.
Next are Reuters' five world market themes, reordered for equity traders—
(1) Mainland China Hopes for Stimulus from the Central Government
Hopes for stimulus from Beijing for China's embattled property sector are well and alive, if property shares in Hong Kong and the mainland at multi-week highs are anything to go by.
Removing the phrase "houses are for living, not for speculation" from a readout of the powerful politburo meeting fueled those hopes, but there's been a distinct lack of concrete detail.
A booming property market is seen as key to igniting lackluster missing consumer spending in post-pandemic China. But Beijing will be wary. Memories of previous property sector bubbles are fresh and developers are still feeling the fallout.
Sino-Ocean Group is considering a debt deferral, Dalian Wanda Commercial Management almost defaulted, and Country Garden faces mounting payment pressures in the coming months.
Purchasing manager surveys in days to come are likely to offer few promising signs, after Thursday's industrial profits numbers extend the double-digit pace of declines into a sixth month.
(2) Starting on Monday, Eurozone Macro Data Comes Out
Markets are impatient. The ECB just hiked rates — as expected — again and the 'will they' or 'won't they' lift rates in September debate is well underway.
So even as rate-setters head for a break, data will still push around rate bets, starting with Monday's preliminary estimate of July Eurozone inflation and second quarter GDP.
Overall inflation is now just half its October peak, but harder-to-break underlying price growth is hovering near historic highs and may have even accelerated again. Both measures remain above the ECB's +2.0% inflation target.
Economists polled by Reuters forecast the Eurozone economy grew +0.2% in Q2. GDP was flat in Q1 versus the previous quarter.
The data could strengthen the case for a September hike.
"Not so fast," ECB doves might argue.
After all, forward-looking indicators such as PMIs are pointing decidedly lower.
(3) On Tuesday, HSBC Will Close Out a Mixed European Earnings Season for Big Banks
HSBC on Tuesday closes out a mixed reporting season for big European banks, with investment banking revenues still dwindling as deal activity slumps, while rising rates lift more staid business lines such as corporate and retail banking.
Investors are hoping for a fresh share buyback after HSBC announced a $2 billion offer last quarter and resumed paying quarterly dividends for the first time since 2019. They will also look for an increase to the bank's conservative-looking $34 billion net interest income forecast.
HSBC investors have long awaited the promised land, where rising central bank interest rates lift margins from lending against its vast deposit base, but the picture is clouded in Britain by political pressure to pay stressed savers more.
And China's precarious economic recovery could in turn revive fears about HSBC's nearly $10 billion exposure to the overextended commercial real state sector.
(4) On Wednesday, August 2nd, the Bank of England (BoE) Sets Monetary Policy
When the Bank of England meets on Aug 2nd, policymakers will finally have something to cheer about. Inflation hasn't accelerated since February and there are signs that widespread price pressures are starting to abate.
But the BoE has been routinely accused of being behind the curve. It's taken policymakers eight months to bring inflation down to 7.9%, from a peak of 11.1%. It took the ECB half that time to achieve the same rate of decline.
Money markets show traders think the odds are split on a 25-bp or a 50-bp hike.
Investors are all too aware of how much more work the BoE has to do. After all, they're holding the most valuable bullish bet on sterling since 2014.
Meanwhile, markets will also work through the fallout from the Bank of Japan's move on Friday to make its yield curve control policy more flexible and water down its commitment to defend a cap on long-term interest rates.
(5) On Friday, We Get July U.S. Federal Non-farm Payroll Data
The Fed appears to have gone into data-dependent mode after hiking rates 25 bps on Wednesday to 5.25-5.50% — a level last seen just before the 2007 housing crash.
Between now and its next meeting in September, the Fed gets two sets of jobs data — and inflation numbers — to pore over.
First up is July non-farm payrolls on Aug. 4th.
Resilient jobs growth has been a key factor in shaping investors' benign outlook on the U.S. economy, a view that — along with ebbing inflation — has helped drive rallies in stocks and other risk assets this year.
Signs of an overly robust labor market could spark worries that the Fed needs to keep tightening monetary policy to contain inflation. Conversely, a steep drop-off in employment might rekindle recession fears.
Economists polled by Reuters expect the U.S. to have added +184K jobs in non-farm payrolls in July, which would be the lowest since the pandemic recovery started.
Mega-caps Apple and Amazon, meanwhile, are expected to report earnings on Aug. 3rd.
Zacks #1 Rank (STRONG BUY) Stocks
Let's look to large market-cap stocks, ones recovering from the COVID share bubble.
(1) Shopify: This is an Internet Services industry player. The stock price is at $64. There is a current market cap of $81.6B.
I see a Zacks Value score of F, a Zacks Growth score of F, and a Zacks Momentum score of C.
Shopify Inc. provides a multi-tenant, cloud-based, multi-channel commerce platform for small and medium-sized businesses.
Merchants use the company's software to run business across various sales channels, including web and mobile storefronts, physical retail locations, social media storefronts, and marketplaces.
Shopify's platform enables merchants to manage products and inventory, process orders and payments, ship orders, build customer relationships and leverage analytics along with reporting from one integrated back office.
Moreover, Shopify hosts a huge database of merchant and customer interactions.
Merchants leverage this transactional dataset to get meaningful insight into the sales channel growth prospects and consumer behavioral aspects.
This improves their ability to target prospective customers more easily, which drives sales growth.
(2) Sherwin Williams: This is a $277 stock in the Paint and Related Products industry.
This company's stock currently has a market cap of $71.2B.
I see a Zacks Value score of D, a Zacks Growth score of C, and a Zacks Momentum score of A.
The Sherwin-Williams Company is into manufacturing and sales of paints, coatings and related products. Its well-known brands include Dutch Boy, Minwax and Krylon.
The company acquired rival paints maker Valspar.
Sherwin-Williams reports in three operating segments: The Americas Group, The Consumer Brands Group and The Performance Coatings Group.
The Americas Group includes the Paint Stores Group and Latin America Coatings Group. The group produces and sells a wide array of industrial coatings, architectural paint and related products.
The Consumer Brands Group includes the company's Consumer Group and Valspar's Consumer Paints segment.
The Performance Coatings Group includes the company's Global Finishes Group and Valspar's Coatings Group and Valspar's Automotive Refinishes products business.
It sells a wide array of industrial coatings and finishes for industrial wood, general industrial, protective and marine, packaging and automotive, coil and extrusion customers.
(3) Workday: This is a $229 stock found in the Internet Software industry. There is a market cap of $60B.
I see a Zacks Value score of F, a Zacks Growth score of A and a Zacks Momentum score of D.
Workday Inc. is a provider of enterprise-level software solutions for financial management and human resource domains.
The company's cloud-based platform combines finance and HR in a single system that makes it easier for organizations to provide analytical insights and decision support. Notably, organizations ranging from medium-sized businesses to enterprises have opted for Workday solutions.
The company also offers open, standards-based web-services application programming interfaces and pre-built packaged integrations and connectors.
The company also offers applications related to Payroll, Time Tracking, Recruiting, Learning, Planning, Professional Services Automation and Student. Workday offers Adaptive Insights Business Planning Cloud solutions, Workday Prism Analytics, Workday Data-as-a-Service and Workday Marketplace.
Workday serves technology, financial services, business services, healthcare and life sciences, manufacturing, consumer and retail industries, education and government industries.
Final note: The three stocks show poor Zacks Value scores of F, as their shares still look to gain more momentum.
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.