For Immediate Release

Chicago, IL – October 28, 2026 – Zacks Equity Research shares Palantir Technologies (PLTR Quick QuotePLTR - Free Report) as the Bull of the Day and Yum! Brands (YUM Quick QuoteYUM - Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Morgan Stanley (MS Quick QuoteMS - Free Report) , Goldman Sachs (GS Quick QuoteGS - Free Report) and JPMorgan (JPM Quick QuoteJPM - Free Report) .

Here is a synopsis of all five stocks:

Bull of the Day:

Zacks Rank #1 (Strong Buy) Palantir Technologies develops and deploys AI-powered software platforms that serve as operating systems for government and commercial organizations. Palantir's platforms are used across about 80 industries and support functions including automotive manufacturing, utility operations, and oil and gas activities. The company offers four core platforms:

1.      Gotham: Helps intelligence agencies identify patterns across complex data sets, enabling faster responses to risks.

2.      Apollo: Manages the secure deployment and continuous updating of software across diverse environments, providing a unified control layer for delivering new features, security updates, and platform configurations.

3.      Foundry: A central operating system for enterprise data, allowing users to integrate, organize, and analyze information in a single environment to support business operations and decision-making.

4.      AIP: Enables organizations to integrate large language models and other AI technologies into operational workflows.

Government Demand Drives Palantir's Growth

Palantir has a major advantage over most AI companies because it mainly sells its software to deep-pocketed, sticky commercial and government customers. Additionally, Palantir is insulated from competition because it has been earned FedRAMP High and Department of Defense Impact Level 6 accreditations, the highest security clearances required for sensitive national security and defense intelligence systems. In Q2, U.S. commercial and government revenues soared 149% and 90% respectively, while Palantir closed 220 deals worth at least $1 million (including 73 worth at least $10 million).

Palantir: A Hedge on Global Turmoil

While most tech companies are adversely impacted by geopolitical turmoil, Palantir benefits from it. US. Defense spending has soared in recent years, and with no resolution in sight to two major wars, Palantir acts as a valuable geopolitical hedge for Wall Street investors.

Palantir: Low Capex Spend

Unlike most leading AI companies, Palantir's annual Capex spending is tepid. Palantir can do this because instead of investing in capital-heavy data centers, it builds the application layer of the AI ecosystem. Assuming the current run rate persists, the company is expected to spend under $50 million in Capex for full-year 2026.

Palantir: Explosive Growth Expectations

Wall Street analysts are extremely bullish on Palantir's growth trajectory. The latest Zacks Consensus Estimates project top-and-bottom-line growth will be in the high double digits through next year.

Palantir: A Consistent Expectation Breaker

Palantir is one of Wall Street's most consistent earnings performers. It has beaten Zacks Consensus Estimates for 15 consecutive quarters and sports a juicy 15.79% average surprise over the past four.

Palantir: A Relative Strength Powerhouse

Over the past three months, many tech stocks are down 50% or more amid fears of an AI slowdown. However, Palantir has proven resilient, gaining more than 50% over that period.

Bottom Line

With robust government accreditations, accelerating revenue growth, and a low-capital application model, Palantir stands out as an AI leader. Its consistent earnings beats, resilience against broader tech pullbacks, and strategic positioning as a geopolitical hedge make it a prime Zacks Rank #1 (Strong Buy) candidate for growth-oriented portfolios.

Bear of the Day:

Zacks Rank #5 (Strong Sell) stock Yum! Brands develops, operates, and franchises quick-service restaurant brands worldwide. Headquartered in Louisville, KY, the company was spun off from PepsiCo in late 1997. Yum has four segments including KFC, Pizza Hut, Taco Bell, and The Havit Burger and Grill. KFC represented 43.1% of total revenues, Taco Bell 37.7%, Pizza Hut (recently sold), and Habit Burger & grill 6.9%. Yum! Brands and its subsidiaries franchise or operate more than 44,000 restaurants in 151 countries and territories and generates revenues through company-operated restaurants, property revenues, and franchise contributions for advertising and other services.

Taco Bell Food Safety Issues

Earlier this year, Yum! Brands' Taco Bell restaurants were blamed for a major food safety issue. Shredded iceberg lettuce sourced from a central Mexico supplier and used in Taco Bell locations led to a widespread outbreak of cyclosporiasis, a gastrointestinal illness. Although the issue has been resolved, it is likely to have a negative impact on earnings as restaurant traffic slowed following the outbreak. Because Taco Bell represents 43% of divisional operating profit excluding Pizza Hut, the impact could be significant.

A Strained Consumer and Adverse Value Perception

Stubborn, sticky inflation has been a headwind for fast food restaurants for the past few years. For instance, recent data shows that transitions into serious credit card delinquencies for Americans aged 18-29 rose to 10.1% in Q2 2026, their highest in over a year (they have doubled since 2021). Meanwhile, the recent spike in gas prices will only strain the American consumer more, forcing many to pullback on spending money eating out. Additionally, Yum! Brands' value perception has declined significantly due to compound fast-food price increased that have outpaced grocery inflation.

Pizza Hut Sale Brings Concentration Risk

Recently, Yum sold its Pizza Hut segment for $2.7 billion. Although the sale generates some much-needed cash, the company faces concentration risk. Yum's success now rides on Taco Bell (the U.S. growth engine) and KFC (the international growth engine). That's concentration in both directions: one brand in one market, one brand exposed to geopolitical disruption.

Wall Street Sees Stagnant Growth for Yum! Brands

Zacks Consensus Analyst Estimates suggest that Yum! Brands will see lackluster, single-digit sales and EPS growth through next year.

Yum is a Laggard

Over the past 5 years, Yum shares have exhibited troubling relative price performance. Yum shares are up just 13.1%, lagging far behind the S&P 500's 83.2% gain over the same period. With no relief to the fundamental story on the horizon, owning Yum shares is a huge opportunity cost for investors.

Bottom Line

A stretched consumer backdrop and a food-safety overhand remind us how quickly brand equity can wobble. Between single-digit growth on the horizon and relative price weakness, Yum! Brands is an avoid.

Additional content:

Can AI Adoption Sustain Morgan Stanley's Wealth Management Growth?

Morgan Stanley is leveraging artificial intelligence (AI) to improve advisor productivity, accelerate asset gathering and strengthen operating efficiency. With Wealth Management revenues reaching a record high in the third quarter of 2026, AI-enabled efficiencies could help the division sustain its growth momentum by expanding client servicing capacity and supporting recurring fee revenues.

The company's AI-powered tools, including AI @ Morgan Stanley Assistant and AI @ Morgan Stanley Debrief, streamline advisor workflows. The Assistant provides faster access to research and investment insights, with adoption exceeding 98% of advisor teams. Meanwhile, Debrief automates meeting summaries, follow-up communications and client documentation. By reducing administrative workloads, these tools are likely to enable advisors to devote more time to client acquisition, relationship management and cross-selling, supporting additional asset inflows and fee-generating opportunities.

This potential aligns with Morgan Stanley's robust third-quarter performance. Wealth Management revenues increased 10.1% year over year to a record $9.07 billion, supported by higher asset management fees and net interest income. The division attracted $232.4 billion in net new assets and $80.5 billion in fee-based asset flows. AI-driven advisor capacity improvements are expected to help sustain such asset-gathering momentum while limiting incremental servicing costs, potentially strengthening the division's 30.4% pre-tax margin over time.

AI adoption could help Morgan Stanley convert its growing client asset base into sustained fee revenues and stronger operating leverage. However, its direct earnings contribution remains unquantified, while technology costs and market volatility pose challenges. Sustained asset inflows and tangible margin expansion will be critical to assessing AI's long-term value and its impact on the Wealth Management division's performance.

How Are Morgan Stanley's Peers Leveraging AI?

Two close peers of Morgan Stanley are Goldman Sachs and JPMorgan.

Goldman is leveraging AI to streamline workflows, automate routine tasks and enhance employee productivity. Its AI-powered tools support research, data analysis, document summarization and software development, enabling employees to focus on higher-value activities. These initiatives are likely to improve operational efficiency, strengthen client servicing capabilities and support long-term cost optimization at Goldman.

JPMorgan is leveraging AI through its LLM Suite platform to automate workflows, streamline operations and enhance employee productivity. It is expanding AI applications across software development, customer servicing, risk management and investment research. These initiatives are expected to improve operational efficiency, reduce costs and strengthen operating leverage at JPMorgan.

Morgan Stanley's Price Performance, Valuation and Estimates

MS shares have rallied 3.4% so far this year against the industry's decline of 1%.

From a valuation standpoint, Morgan Stanley trades at a 12-month trailing price-to-tangible book (P/TB) of 3.39X, above the industry average. 

The Zacks Consensus Estimate for Morgan Stanley's 2026 earnings suggests a 25.7% year-over-year rise, while 2027 earnings are expected to rise 3.9%. In the past 30 days, earnings estimates for 2026 and 2027 have moved upward to $12.83 and $13.33, respectively.

MS currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

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