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Shopify and Cardinal Infrastructure have been highlighted as Zacks Bull and Bear of the Day
Read MoreHide Full Article
For Immediate Release
Chicago, IL – October 20, 2026 – Zacks Equity Research shares Shopify Inc. (SHOP - Free Report) as the Bull of the Day and Cardinal Infrastructure Group Inc. (CDNL - Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Tesla (TSLA - Free Report) , Rivian Automotive (RIVN - Free Report) and Lucid Group (LCID - Free Report) .
Shopify Inc. is back to growing earnings at double digits as it adopts AI tools onto its platform. This Zacks Rank #1 (Strong Buy) is expected to grow revenue by 31.5% in 2026.
Shopify operates a platform that allows people to start, and grow, a business from anywhere. With powerful tools, including thousands of apps, Shopify merchants can be on the cutting edge of any marketplace.
It has millions of merchants in 175+ countries.
Analysts Are Bullish on Shopify Again
Shopify reports third quarter 2026 earnings on Nov 3, 2026. But the analysts are already getting bullish.
The Zacks Consensus for Q3 2026 has risen a penny to $0.45 from $0.44 in the last month. But the most accurate estimate, which is the most recent one, is looking for $0.49.
That is bullish to see the most accurate estimate higher than the consensus.
Additionally, analysts have been raising estimates for next year in the last week as well. The 2027 Zacks Consensus is looking for $2.38, up from $2.36 in the last 60 days. The most accurate estimate is looking for $2.41.
This is above the consensus and is bullish for next year.
Earnings are expected to rise 61.5% this year and another 25.9% in 2027.
Shopify is a Growth Story Again
Shopify reported second quarter results on Aug 5, 2026, and beat on the Zacks Consensus by $0.03. Earnings were $0.42 versus the consensus of $0.39.
Revenue grew 34% and free cash flow margins were 18%, up from 16% in the year ago quarter.
"This was a monster quarter: more than 30% growth in GMV AND revenue AND gross profit AND free cash flow," said Harley Finkelstein, President of Shopify.
Shopify is Leaning into AI
In the second quarter, Shopify said there was a 3x increase in orders originating from AI searches year-over-year.
It also has a new agentic section on the admin window which allows merchants to see which AI channels are live and can track their real time performance.
Shares of Shopify Rally
Shopify was a pandemic darling but then the stock sold off in 2022 when the growth stocks took a hit as the FOMC raised interest rates.
It's been a long 5 years but the shares have rallied over the last three months, easily beating the S&P 500.
You aren't buying Shopify for its valuation. It is still an expensive stock. It trades with a forward price-to-earnings (P/E) ratio of 89.5. A P/E over 30 is considered stretched. A P/E over 80 is expensive.
But for investors looking for a growth stock with a dose of AI on the side, Shopify should be on your short list.
Cardinal Infrastructure Group Inc.is expanding its construction business. But this Zacks Rank #5 (Strong Sell) has seen earnings estimates cut in the last week.
Cardinal Infrastructure Group delivers its suite of comprehensive infrastructure services that support the planning, preparation, installation, and development of residential, commercial, industrial, municipal, and state infrastructure projects.
Cardinal's operations leverage in-house, skilled teams and equipment fleets to deliver wet utility installations (water, sewer, and stormwater systems), as well as grading, site clearing, erosion control, drilling and blasting, paving, and other related site services.
Cardinal to Acquire Hughes Brothers Construction for $357.5 Million
On Oct 13, 2026, Cardinal announced it had entered into an agreement to acquire Hughes Brothers Construction Inc., which is a Central Florida heavy civil and site development contractor.
The deal was modified on Oct 19, 2026. The amended agreement maintained the $357.5 million purchase price but changed the consideration to 60% cash and 40% common stock, from 50% of each previously.
The acquisition is expected to be immediately accretive to adjusted EBITDA per share.
Hughes Brothers had a current backlog of approximately $350 million. It establishes a platform in the fast-growing Central Florida market.
This comes on top of the acquisition of Allied Paving, which was announced on Aug 11, 2026. Allied Paving is an Atlanta-based paving and heavy site construction contractor.
Why is Cardinal Infrastructure Group a Strong Sell?
The Zacks Rank is based on changes to analyst earnings estimates.
One estimate has been cut on Cardinal for both 2026 and 2027 in the last week. In 2026, it pushed the Zacks Consensus Estimate down to $1.77 from $1.85 during that time.
That doesn't seem so bad. But the most accurate estimate, which is the most recent, has the 2026 earnings at $1.52 versus the $1.77 consensus.
One estimate was also cut for 2027 in the last week. It pushed the Zacks Consensus down to $2.16 from $2.28. That's earnings growth of 22.1%, however.
Cardinal Shares Sink
Cardinal Infrastructure Group got caught up in the AI stock rally in early summer and in the AI stock sell-off of the last several months.
Shares are now cheap. Cardinal trades with a forward price-to-earnings (P/E) ratio of 8.3. A P/E under 10 usually indicates a company has deep value.
Cardinal Infrastructure has not yet reported its third quarter of 2026 earnings.
Cardinal seems like a deal. But until the earnings estimates turn around, value investors might want to wait on the sidelines for a stronger entry point.
Additional content:
Buy, Sell or Hold Tesla Stock? Key Tips Ahead of Q3 Earnings
Tesla is slated to release third-quarter 2026 results on Wednesday, after market close. The Zacks Consensus Estimate for the to-be-reported quarter's earnings and revenues is pegged at 44 cents per share and $27.8 billion, respectively.
The earnings estimate for the to-be-reported quarter has been revised upward by a cent over the past seven days. The bottom-line projection indicates a year-over-year decline of 12%. The Zacks Consensus Estimate for quarterly revenues suggests a year-over-year contraction of 1.1%.
For full-year 2026, the Zacks Consensus Estimate for TSLA's revenues is pegged at $106 billion, implying a rise of 11.9% year over year. The consensus mark for 2026 EPS is pegged at $1.69, suggesting an uptick of around 2% on a year-over-year basis.
In the trailing four quarters, this electric vehicle (EV) and technology giant topped EPS estimates on two occasions for as many misses, with the average negative earnings surprise being 3.67%.
Earnings Whispers for TSLA
Our proprietary model does not predict an earnings beat for Tesla this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That's not the case here. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
TSLA has an Earnings ESP of -10.98% and a Zacks Rank #4 (Sell).
Tesla delivered 486,532 vehicles (comprising 478,237 units of Model 3/Y and 8,295 Other models) in the third quarter of 2026, up 1.3% sequentially. It was Tesla's strongest quarter for EV sales since the third quarter of 2025, when U.S. buyers rushed to purchase before federal EV tax credits expired, prompting the automaker to see a temporary surge in demand. However, the deliveries missed our model estimate of 494,446 units and also declined 2.1% on a year-over-year basis.
Tesla's smaller pure-play EV peers — Rivian Automotive and Lucid Group — came up with contrasting third-quarter delivery reports. While Rivian delivered 19,248 vehicles, topping estimates and rising 45.8% year over year, Lucid fell short of expectations, delivering just 3,806 vehicles, down 6.6%.
Coming back to Tesla, we expect automotive sales of roughly $20 billion, indicating a contraction of 1.6%. Our estimate for the company's energy business revenues is pegged at $3.7 billion, suggesting an increase of 10%.
However, we expect Tesla's total operating income to decline more than 68% due to higher cost of revenues, R&D and SG&A expenses. Spending related to AI, Cybercab, Optimus and Tesla Semi is likely to have impacted operating results and pressured free cash flow. In the second quarter of 2026, the company's free cash flow turned negative to $1.09 billion, and with capex on the rise, third-quarter FCF is also expected to have remained negative.
Tesla Price Performance & Valuation
Year to date, shares of Tesla have plunged 21%, underperforming the sector.
Tesla stock is quite overvalued. Going by its price/sales ratio, the company is trading at a forward sales multiple of 12.09, way higher than the sector as well as its own five-year average.
How to Play TSLA Stock Now
Tesla's vehicle demand is stabilizing, and energy storage deployments are rising, but those gains are not translating into profits. Margins are on the decline, and heavy capex needs are becoming a major sticking point. Management now expects 2026 capex to exceed $25 billion and spending to grow for the next two to three years. This front-loaded investment is likely to keep the cash generation weak before newer businesses, including AI, AVs and robotics, contribute enough profit to offset the cost of scaling them.
Investors are mostly paying for its bets on AI-driven autonomy and the Optimus humanoid robot, which Musk has framed as the company's next growth chapters. But the gap between promise and progress is huge. Tesla's robotaxi network had covered roughly 380,000 driverless miles, according to its second-quarter earnings release. Close peer Waymo has passed 220 million rider-only miles. Optimus is still at an early stage, and the company expects ramp-up will be gradual because many parts and supply chains are new. These bets offer genuine long-term potential, but they must eventually produce meaningful financial returns to justify the cost.
Until then, execution and valuation risks remain concerning. As such, investors are better off staying away from the stock now. And if they are sitting on profits, it might be time to book the gains ahead of the third-quarter earnings release.
Why Haven't You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +7.7% average gain per year. Amazingly, they soared with average gains of +48.4%, +50.2% and +56.7% 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/performancefor information about the performance numbers displayed in this press release.
View the Zacks #1 Rank List
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Shopify and Cardinal Infrastructure have been highlighted as Zacks Bull and Bear of the Day
For Immediate Release
Chicago, IL – October 20, 2026 – Zacks Equity Research shares Shopify Inc. (SHOP - Free Report) as the Bull of the Day and Cardinal Infrastructure Group Inc. (CDNL - Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Tesla (TSLA - Free Report) , Rivian Automotive (RIVN - Free Report) and Lucid Group (LCID - Free Report) .
Here is a synopsis of all five stocks:
Bull of the Day:
Shopify Inc. is back to growing earnings at double digits as it adopts AI tools onto its platform. This Zacks Rank #1 (Strong Buy) is expected to grow revenue by 31.5% in 2026.
Shopify operates a platform that allows people to start, and grow, a business from anywhere. With powerful tools, including thousands of apps, Shopify merchants can be on the cutting edge of any marketplace.
It has millions of merchants in 175+ countries.
Analysts Are Bullish on Shopify Again
Shopify reports third quarter 2026 earnings on Nov 3, 2026. But the analysts are already getting bullish.
The Zacks Consensus for Q3 2026 has risen a penny to $0.45 from $0.44 in the last month. But the most accurate estimate, which is the most recent one, is looking for $0.49.
That is bullish to see the most accurate estimate higher than the consensus.
Additionally, analysts have been raising estimates for next year in the last week as well. The 2027 Zacks Consensus is looking for $2.38, up from $2.36 in the last 60 days. The most accurate estimate is looking for $2.41.
This is above the consensus and is bullish for next year.
Earnings are expected to rise 61.5% this year and another 25.9% in 2027.
Shopify is a Growth Story Again
Shopify reported second quarter results on Aug 5, 2026, and beat on the Zacks Consensus by $0.03. Earnings were $0.42 versus the consensus of $0.39.
Revenue grew 34% and free cash flow margins were 18%, up from 16% in the year ago quarter.
"This was a monster quarter: more than 30% growth in GMV AND revenue AND gross profit AND free cash flow," said Harley Finkelstein, President of Shopify.
Shopify is Leaning into AI
In the second quarter, Shopify said there was a 3x increase in orders originating from AI searches year-over-year.
It also has a new agentic section on the admin window which allows merchants to see which AI channels are live and can track their real time performance.
Shares of Shopify Rally
Shopify was a pandemic darling but then the stock sold off in 2022 when the growth stocks took a hit as the FOMC raised interest rates.
It's been a long 5 years but the shares have rallied over the last three months, easily beating the S&P 500.
You aren't buying Shopify for its valuation. It is still an expensive stock. It trades with a forward price-to-earnings (P/E) ratio of 89.5. A P/E over 30 is considered stretched. A P/E over 80 is expensive.
But for investors looking for a growth stock with a dose of AI on the side, Shopify should be on your short list.
Bear of the Day:
Cardinal Infrastructure Group Inc.is expanding its construction business. But this Zacks Rank #5 (Strong Sell) has seen earnings estimates cut in the last week.
Cardinal Infrastructure Group delivers its suite of comprehensive infrastructure services that support the planning, preparation, installation, and development of residential, commercial, industrial, municipal, and state infrastructure projects.
Cardinal's operations leverage in-house, skilled teams and equipment fleets to deliver wet utility installations (water, sewer, and stormwater systems), as well as grading, site clearing, erosion control, drilling and blasting, paving, and other related site services.
Cardinal to Acquire Hughes Brothers Construction for $357.5 Million
On Oct 13, 2026, Cardinal announced it had entered into an agreement to acquire Hughes Brothers Construction Inc., which is a Central Florida heavy civil and site development contractor.
The deal was modified on Oct 19, 2026. The amended agreement maintained the $357.5 million purchase price but changed the consideration to 60% cash and 40% common stock, from 50% of each previously.
The acquisition is expected to be immediately accretive to adjusted EBITDA per share.
Hughes Brothers had a current backlog of approximately $350 million. It establishes a platform in the fast-growing Central Florida market.
This comes on top of the acquisition of Allied Paving, which was announced on Aug 11, 2026. Allied Paving is an Atlanta-based paving and heavy site construction contractor.
Why is Cardinal Infrastructure Group a Strong Sell?
The Zacks Rank is based on changes to analyst earnings estimates.
One estimate has been cut on Cardinal for both 2026 and 2027 in the last week. In 2026, it pushed the Zacks Consensus Estimate down to $1.77 from $1.85 during that time.
That doesn't seem so bad. But the most accurate estimate, which is the most recent, has the 2026 earnings at $1.52 versus the $1.77 consensus.
One estimate was also cut for 2027 in the last week. It pushed the Zacks Consensus down to $2.16 from $2.28. That's earnings growth of 22.1%, however.
Cardinal Shares Sink
Cardinal Infrastructure Group got caught up in the AI stock rally in early summer and in the AI stock sell-off of the last several months.
Shares are now cheap. Cardinal trades with a forward price-to-earnings (P/E) ratio of 8.3. A P/E under 10 usually indicates a company has deep value.
Cardinal Infrastructure has not yet reported its third quarter of 2026 earnings.
Cardinal seems like a deal. But until the earnings estimates turn around, value investors might want to wait on the sidelines for a stronger entry point.
Additional content:
Buy, Sell or Hold Tesla Stock? Key Tips Ahead of Q3 Earnings
Tesla is slated to release third-quarter 2026 results on Wednesday, after market close. The Zacks Consensus Estimate for the to-be-reported quarter's earnings and revenues is pegged at 44 cents per share and $27.8 billion, respectively.
The earnings estimate for the to-be-reported quarter has been revised upward by a cent over the past seven days. The bottom-line projection indicates a year-over-year decline of 12%. The Zacks Consensus Estimate for quarterly revenues suggests a year-over-year contraction of 1.1%.
For full-year 2026, the Zacks Consensus Estimate for TSLA's revenues is pegged at $106 billion, implying a rise of 11.9% year over year. The consensus mark for 2026 EPS is pegged at $1.69, suggesting an uptick of around 2% on a year-over-year basis.
In the trailing four quarters, this electric vehicle (EV) and technology giant topped EPS estimates on two occasions for as many misses, with the average negative earnings surprise being 3.67%.
Earnings Whispers for TSLA
Our proprietary model does not predict an earnings beat for Tesla this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That's not the case here. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
TSLA has an Earnings ESP of -10.98% and a Zacks Rank #4 (Sell).
You can see the complete list of today's Zacks #1 Rank stocks here.
Factors Shaping Tesla's Q3 Results
Tesla delivered 486,532 vehicles (comprising 478,237 units of Model 3/Y and 8,295 Other models) in the third quarter of 2026, up 1.3% sequentially. It was Tesla's strongest quarter for EV sales since the third quarter of 2025, when U.S. buyers rushed to purchase before federal EV tax credits expired, prompting the automaker to see a temporary surge in demand. However, the deliveries missed our model estimate of 494,446 units and also declined 2.1% on a year-over-year basis.
Tesla's smaller pure-play EV peers — Rivian Automotive and Lucid Group — came up with contrasting third-quarter delivery reports. While Rivian delivered 19,248 vehicles, topping estimates and rising 45.8% year over year, Lucid fell short of expectations, delivering just 3,806 vehicles, down 6.6%.
Coming back to Tesla, we expect automotive sales of roughly $20 billion, indicating a contraction of 1.6%. Our estimate for the company's energy business revenues is pegged at $3.7 billion, suggesting an increase of 10%.
However, we expect Tesla's total operating income to decline more than 68% due to higher cost of revenues, R&D and SG&A expenses. Spending related to AI, Cybercab, Optimus and Tesla Semi is likely to have impacted operating results and pressured free cash flow. In the second quarter of 2026, the company's free cash flow turned negative to $1.09 billion, and with capex on the rise, third-quarter FCF is also expected to have remained negative.
Tesla Price Performance & Valuation
Year to date, shares of Tesla have plunged 21%, underperforming the sector.
Tesla stock is quite overvalued. Going by its price/sales ratio, the company is trading at a forward sales multiple of 12.09, way higher than the sector as well as its own five-year average.
How to Play TSLA Stock Now
Tesla's vehicle demand is stabilizing, and energy storage deployments are rising, but those gains are not translating into profits. Margins are on the decline, and heavy capex needs are becoming a major sticking point. Management now expects 2026 capex to exceed $25 billion and spending to grow for the next two to three years. This front-loaded investment is likely to keep the cash generation weak before newer businesses, including AI, AVs and robotics, contribute enough profit to offset the cost of scaling them.
Investors are mostly paying for its bets on AI-driven autonomy and the Optimus humanoid robot, which Musk has framed as the company's next growth chapters. But the gap between promise and progress is huge. Tesla's robotaxi network had covered roughly 380,000 driverless miles, according to its second-quarter earnings release. Close peer Waymo has passed 220 million rider-only miles. Optimus is still at an early stage, and the company expects ramp-up will be gradual because many parts and supply chains are new. These bets offer genuine long-term potential, but they must eventually produce meaningful financial returns to justify the cost.
Until then, execution and valuation risks remain concerning. As such, investors are better off staying away from the stock now. And if they are sitting on profits, it might be time to book the gains ahead of the third-quarter earnings release.
Why Haven't You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +7.7% average gain per year. Amazingly, they soared with average gains of +48.4%, +50.2% and +56.7% per year.
Today you can access their live picks without cost or obligation.
See Stocks Free >>
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Zacks Investment Research
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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.