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Navigator Holdings and Marathon Oil have been highlighted as Zacks Bull and Bear of the Day
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For Immediate Release
Chicago, IL – January 19, 2024 – Zacks Equity Research shares Navigator Holdings (NVGS - Free Report) as the Bull of the Day and Marathon Oil (MRO - Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on IBM Corp. (IBM - Free Report) , InterDigital, Inc. (IDCC - Free Report) and Meta Platforms, Inc. (META - Free Report) .
Navigator Holdings is a Zacks Rank #1 (Strong Bu) that has a C for Value and B for Growth. This is a shipping company that is focused on the transportation of oil and gas. I am sure that you have seen the escalation of tensions and violence in the Red Sea and that geopolitical news is going to cause shipping rates to move a lot higher. Even ships that are not in the Red Sea will see prices increase as the potential for attacks outside of the region has grown. Let’s explore more about this company in this Bull of The Day article.
Description
Navigator Holdings Ltd. owns and operates a fleet of handy-size liquefied gas carriers. It also provides international seaborne transportation and regional distribution services of liquefied petroleum gas, petrochemical gases, and ammonia for energy companies, industrial users, and commodity traders. The company was founded in 1997 and is headquartered in London, the United Kingdom.
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 Navigator Holdings, I see one beat of the Zacks Consensus Estimate and one meet and two misses over the last year. The average positive earnings surprise over the last year works out to be a positive 0.14%.
The beat was 3 quarters ago and was good for 41% and that was enough to give this stock a positive average surprise for the year.
Earnings Estimates Revisions
Earnings estimates revisions is what the Zacks Rank is all about.
This quarter bumped up a penny in the last 60 days and that took the full year number up a penny as well.
Next quarter has seen a move lower to 30 cents from 34 cents.
The full year 2024 is at $1.46 and that is up a penny over the last 60 days.
If shipping rates continue to rise, these numbers should trend higher as well.
Valuation
I see a forward multiple of 10.6x and that is very low for a company that posted topline 29% in the most recent quarter. The price book is at 0.95x which means that we are buying this stock for less than the value of the assets on the books. Value players love a stock that is below 1x on price to book and with good growth and earnings growth this makes this a great play here. Margins increased from 10.8% in June to 13.4% in September.
Marathon Oil is a Zacks Rank #5 (Strong Sell) as earnings estimates have tracked lower due to softer demand for oil. Over the last year, the company has posted 4 straight beats of the Zacks Consensus Estimate. This article will look at why this stock is a Zacks Rank #5 (Strong Sell) as it is the Bear of the Day.
Description
Marathon Oil Corp. engages in the exploration, production, and marketing of liquid hydrocarbons and natural gas. It operates through the following two segments: United States (U. S.) and International. The U. S. segment engages in oil and gas exploration, development and production activities in the U.S. The International segment engages in oil and gas development and production across international locations primarily in Equatorial Guinea and the United Kingdom. The company was founded in 1887 and is headquartered in Houston, TX.
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 Marathon Oil, I see four beats of the Zacks Consensus Estimate. 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 MRO I see annual estimates moving lower of late.
The current fiscal year (2023) consensus number moved lower from $2.73 to $2.62 over the last 60 days.
The next year moved from a gain of $3.83 to $3.14 over the last 60 days.
Negative movement in earnings estimates like that is why this stock is a Zacks Rank #5 (Strong Sell).
It should be noted that a lot 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:
Will IBM's Q4 Earnings Benefit from Healthy Revenue Growth?
IBM Corp. is scheduled to report fourth-quarter 2023 results on Jan 24, after the closing bell. In the last reported quarter, the New York-based integrated systems provider beat the Zacks Consensus Estimate by 8 cents.
The company is expected to have recorded a top-line expansion year over year, backed by growing demand for its AI-powered solution suite across industries. Management’s policy to expand its portfolio with a strong focus on innovations and strategic buyouts is a tailwind.
Factors at Play
During the fourth quarter, IBM introduced Threat Detection and Response Services (TDR), a new comprehensive suite of AI-powered technologies designed to augment an organization’s cyber defense capabilities. Leveraging AI models, this solution effectively analyses security data and offers 24/7 monitoring and investigation across hybrid cloud environments.
During the quarter, IBM unveiled watsonx.governance, a new addition to its WatsonX AI solution suite, aimed at enhancing the management and monitoring of AI models, whether generated from IBM or through other open-source communities. It enriches enterprises with necessary toolkits that automate AI governance processes, enabling corrective actions to mitigate risks and biases.
IBM introduced a cloud database solution in collaboration with Amazon to streamline the management of AI-driven data workloads. The integration of the IBM Db2 database with Amazon RDS is expected to deliver enhanced scalability and security in databases, empowering enterprises to extract more precise insights from their data. EY collaborated with IBM to develop EY.ai Workforce, a cutting-edge HR solution that optimizes enterprises’ HR processes with the assistance of AI. These are likely to have driven the top-line growth in the Software segment.
Moreover, IBM introduced various advancements in geospatial AI technologies to effectively address the climate challenges and better manage the issues arising from them. IBM has joined forces with premium academic institutes and public enterprises worldwide to accelerate research and further boost the capability of its Geospatial AI models.
During the December quarter, IBM inked a strategic agreement with Riyadh Air. Per the deal, IBM Consulting will provide core technological capabilities and facilitate the implementation of various airline industry solutions spanning from security, infrastructure and data platforms. IBM will also offer program and technical governance, project management, quality assurance, communications management and training.
IBM and KPMG LLP extended their collaboration to assist enterprises in the energy and utilities industry with SAP S/4HANA implementation for business transformation. The partnership intends to minimize risks associated with cloud ERP (enterprise resource planning) projects by leveraging IBM Consulting and KPMG's complementary expertise in SAP technology, cross-sector business processes, regulatory compliance, risk management, finance and tax considerations. These are likely to have generated incremental revenues in the Consulting segment.
The Zacks Consensus Estimate for total revenues for the company stands at $17,116 million. It generated revenues of $16,690 million in the prior-year quarter. The consensus mark for earnings is currently pegged at $3.75 per share, indicating growth from $3.60 in the year-earlier quarter.
Key Developments in Q4
During the to-be-reported quarter, IBM signed a definitive agreement to acquire Software AG’s iPaaS (integration platform-as-a-service) businesses, StreamSets and webMethods. StreamSets and webMethods are industry leaders in data integration, API management and application integration. The buyout is anticipated to be concluded by the second quarter of 2024 through a €2.13 billion cash transaction. Through this buyout, IBM is likely to derive synergy benefits with its current portfolio, which includes watsonx AI, IBM Consulting and other IT automation products.
The company has also made significant advancements in its Quantum Development Roadmap. IBM has unveiled its first modular quantum computer ‘IBM Quantum System Two.’ The system will serve as a foundation for IBM's quantum-centric supercomputing architecture. Unlike the classical simulation methods used in quantum mechanics, IBM Quantum systems provide a more efficient approach to exploring complex problems in chemistry, physics and materials.
Earnings Whispers
Our proven model does not predict an earnings beat for IBM this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is -0.08%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Here are some companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this season:
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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Navigator Holdings and Marathon Oil have been highlighted as Zacks Bull and Bear of the Day
For Immediate Release
Chicago, IL – January 19, 2024 – Zacks Equity Research shares Navigator Holdings (NVGS - Free Report) as the Bull of the Day and Marathon Oil (MRO - Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on IBM Corp. (IBM - Free Report) , InterDigital, Inc. (IDCC - Free Report) and Meta Platforms, Inc. (META - Free Report) .
Here is a synopsis of all five stocks.
Bull of the Day:
Navigator Holdings is a Zacks Rank #1 (Strong Bu) that has a C for Value and B for Growth. This is a shipping company that is focused on the transportation of oil and gas. I am sure that you have seen the escalation of tensions and violence in the Red Sea and that geopolitical news is going to cause shipping rates to move a lot higher. Even ships that are not in the Red Sea will see prices increase as the potential for attacks outside of the region has grown. Let’s explore more about this company in this Bull of The Day article.
Description
Navigator Holdings Ltd. owns and operates a fleet of handy-size liquefied gas carriers. It also provides international seaborne transportation and regional distribution services of liquefied petroleum gas, petrochemical gases, and ammonia for energy companies, industrial users, and commodity traders. The company was founded in 1997 and is headquartered in London, the United Kingdom.
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 Navigator Holdings, I see one beat of the Zacks Consensus Estimate and one meet and two misses over the last year. The average positive earnings surprise over the last year works out to be a positive 0.14%.
The beat was 3 quarters ago and was good for 41% and that was enough to give this stock a positive average surprise for the year.
Earnings Estimates Revisions
Earnings estimates revisions is what the Zacks Rank is all about.
This quarter bumped up a penny in the last 60 days and that took the full year number up a penny as well.
Next quarter has seen a move lower to 30 cents from 34 cents.
The full year 2024 is at $1.46 and that is up a penny over the last 60 days.
If shipping rates continue to rise, these numbers should trend higher as well.
Valuation
I see a forward multiple of 10.6x and that is very low for a company that posted topline 29% in the most recent quarter. The price book is at 0.95x which means that we are buying this stock for less than the value of the assets on the books. Value players love a stock that is below 1x on price to book and with good growth and earnings growth this makes this a great play here. Margins increased from 10.8% in June to 13.4% in September.
Bear of the Day:
Marathon Oil is a Zacks Rank #5 (Strong Sell) as earnings estimates have tracked lower due to softer demand for oil. Over the last year, the company has posted 4 straight beats of the Zacks Consensus Estimate. This article will look at why this stock is a Zacks Rank #5 (Strong Sell) as it is the Bear of the Day.
Description
Marathon Oil Corp. engages in the exploration, production, and marketing of liquid hydrocarbons and natural gas. It operates through the following two segments: United States (U. S.) and International. The U. S. segment engages in oil and gas exploration, development and production activities in the U.S. The International segment engages in oil and gas development and production across international locations primarily in Equatorial Guinea and the United Kingdom. The company was founded in 1887 and is headquartered in Houston, TX.
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 Marathon Oil, I see four beats of the Zacks Consensus Estimate. 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 MRO I see annual estimates moving lower of late.
The current fiscal year (2023) consensus number moved lower from $2.73 to $2.62 over the last 60 days.
The next year moved from a gain of $3.83 to $3.14 over the last 60 days.
Negative movement in earnings estimates like that is why this stock is a Zacks Rank #5 (Strong Sell).
It should be noted that a lot 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:
Will IBM's Q4 Earnings Benefit from Healthy Revenue Growth?
IBM Corp. is scheduled to report fourth-quarter 2023 results on Jan 24, after the closing bell. In the last reported quarter, the New York-based integrated systems provider beat the Zacks Consensus Estimate by 8 cents.
The company is expected to have recorded a top-line expansion year over year, backed by growing demand for its AI-powered solution suite across industries. Management’s policy to expand its portfolio with a strong focus on innovations and strategic buyouts is a tailwind.
Factors at Play
During the fourth quarter, IBM introduced Threat Detection and Response Services (TDR), a new comprehensive suite of AI-powered technologies designed to augment an organization’s cyber defense capabilities. Leveraging AI models, this solution effectively analyses security data and offers 24/7 monitoring and investigation across hybrid cloud environments.
During the quarter, IBM unveiled watsonx.governance, a new addition to its WatsonX AI solution suite, aimed at enhancing the management and monitoring of AI models, whether generated from IBM or through other open-source communities. It enriches enterprises with necessary toolkits that automate AI governance processes, enabling corrective actions to mitigate risks and biases.
IBM introduced a cloud database solution in collaboration with Amazon to streamline the management of AI-driven data workloads. The integration of the IBM Db2 database with Amazon RDS is expected to deliver enhanced scalability and security in databases, empowering enterprises to extract more precise insights from their data. EY collaborated with IBM to develop EY.ai Workforce, a cutting-edge HR solution that optimizes enterprises’ HR processes with the assistance of AI. These are likely to have driven the top-line growth in the Software segment.
Moreover, IBM introduced various advancements in geospatial AI technologies to effectively address the climate challenges and better manage the issues arising from them. IBM has joined forces with premium academic institutes and public enterprises worldwide to accelerate research and further boost the capability of its Geospatial AI models.
During the December quarter, IBM inked a strategic agreement with Riyadh Air. Per the deal, IBM Consulting will provide core technological capabilities and facilitate the implementation of various airline industry solutions spanning from security, infrastructure and data platforms. IBM will also offer program and technical governance, project management, quality assurance, communications management and training.
IBM and KPMG LLP extended their collaboration to assist enterprises in the energy and utilities industry with SAP S/4HANA implementation for business transformation. The partnership intends to minimize risks associated with cloud ERP (enterprise resource planning) projects by leveraging IBM Consulting and KPMG's complementary expertise in SAP technology, cross-sector business processes, regulatory compliance, risk management, finance and tax considerations. These are likely to have generated incremental revenues in the Consulting segment.
The Zacks Consensus Estimate for total revenues for the company stands at $17,116 million. It generated revenues of $16,690 million in the prior-year quarter. The consensus mark for earnings is currently pegged at $3.75 per share, indicating growth from $3.60 in the year-earlier quarter.
Key Developments in Q4
During the to-be-reported quarter, IBM signed a definitive agreement to acquire Software AG’s iPaaS (integration platform-as-a-service) businesses, StreamSets and webMethods. StreamSets and webMethods are industry leaders in data integration, API management and application integration. The buyout is anticipated to be concluded by the second quarter of 2024 through a €2.13 billion cash transaction. Through this buyout, IBM is likely to derive synergy benefits with its current portfolio, which includes watsonx AI, IBM Consulting and other IT automation products.
The company has also made significant advancements in its Quantum Development Roadmap. IBM has unveiled its first modular quantum computer ‘IBM Quantum System Two.’ The system will serve as a foundation for IBM's quantum-centric supercomputing architecture. Unlike the classical simulation methods used in quantum mechanics, IBM Quantum systems provide a more efficient approach to exploring complex problems in chemistry, physics and materials.
Earnings Whispers
Our proven model does not predict an earnings beat for IBM this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is -0.08%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
International Business Machines Corporation price-eps-surprise | International Business Machines Corporation Quote
Zacks Rank: IBM currently has a Zacks Rank #2.
Stocks to Consider
Here are some companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this season:
InterDigital, Inc. is set to release quarterly numbers on Feb 15. It has an Earnings ESP of +1.93% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Earnings ESP for Meta Platforms, Inc. is +1.46% and it carries a Zacks Rank of 2. The company is scheduled to report quarterly numbers on Feb 1.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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.
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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/performance for information about the performance numbers displayed in this press release.