For Immediate Release
Chicago, IL – September 21, 2018 – Zacks Equity Research highlights Salesforce (CRM - Free Report) as the Bull of the Day, Campbell Soup Company (CPB - Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Micron (MU - Free Report) .
Here is a synopsis of all three stocks:
Bull of the Day:
Salesforce has seen its stock price jump over 12% in the last three months as the firm continues to bolster its cloud-based customer relationship management offerings. Looking ahead, Salesforce’s top and bottom line growth is something investors might not want to miss.
Overview & Recent News
Salesforce operates within the quickly growing customer relationship management industry that looks poised to become even popular as more businesses adapt to a nearly completely digital age. The company currently boasts over 150,000 business clients, including giants such as Adidas and U.S. Bancorp, offering them a wide range of services that would otherwise require a ton of in-house computing power, technological infrastructure, and maintenance.
Last quarter, Salesforce saw its revenues soar roughly 27% to reach $3.28 billion. The San Francisco-based firm recently announced that it upgraded its Financial Services Cloud to help companies offer a more unified customer experience. Salesforce also launched Quip Slides—an interactive slide presentation tool—to help it better compete against the likes of Microsoft and Google.
Salesforce purchased Quip roughly two years ago, which helped the company roll out Microsoft Office-like products designed for the cloud from word processing to spreadsheets. Plus, the company announced on Thursday a new wrinkle to its Einstein artificial intelligence system called Einstein Voice. The service will allow users to conversationally update tasks on Salesforce, receive audible briefings, explore Salesforce’s dashboard, and more.
The move highlights the prevalence of voice assistants from Amazon’s Alexa to Apple’s Siri. “We're in the midst of an incredible technological shift, where the power of voice is fundamentally changing the way we work," Salesforce Co-Founder and CTO Parker Harris said in a company statement. “Einstein Voice will usher in a new era of conversational CRM, delivering new levels of productivity and redefining customer experiences with voice technology.”
Bear of the Day:
Campbell Soup Company shares have plummeted roughly 21% over the last three years as the packaged food firm tries to navigate shifting consumer habits and the proliferation of healthier upstart options.
Campbell reported its Q4 and full-year financial results at the end of August and it wasn’t pretty. The firm’s fourth-quarter sales dipped 3% from the year-ago period, excluding a 36-point benefit from its recent acquisitions of Snyder’s-Lance and Pacific Foods. Campbell’s organic full-year revenues slipped 2%.
These recent acquisitions were made to help the company try to compete in a more diverse market, geared toward fresh and healthy options. Meanwhile, Campbell’s Q4 marketing and selling expenses soared 29% as it tried to incorporate its new brands. Now, Campbell hopes to sell its international and refrigerated-foods businesses, which include Bolthouse Farms, Garden Fresh, and Kelsen brands, among others.
Campbell’s is not alone, Coca-Cola is set to purchase UK coffee giant Costa for $5.1 billion as it tries to expand its portfolio beyond sugary drinks. However, Campbell’s latest effort, as first reported by The Wall Street Journal and later confirmed by the company, will see it somewhat abandon its plans to offer healthier options. The company also reportedly remains open to an outright sale.
The last three years have not been kind to Campbell stock. Shares of CPB have fallen over 21% in the last 36 months, which looks even worse compared to the S&P 500’s nearly 50% jump. Campbell’s woes have continued despite a brief June jump. In fact, shares of CPB are down over 16% since the start of the year. But investors will notice that its industry hasn’t performed well either and is down over 7% during this same period.
Micron (MU - Free Report) Beats on Top & Bottom Lines, Shares Up
American memory and storage tech firm Micron has released fiscal Q4 2018 (ended August) earnings after Thursday's closing bell, with typically positive results: earnings of $3.53 per share easily beat the Zacks consensus of $3.32, with year-over-year earnings growth up 75%. Quarterly sales posted $8.44 billion, which is not only well above the estimated $8.25 billion but even higher than the top on the previously guided revenue range of $8.4 billion.
Gross margins in the quarter reached 61%, near the top of that guidance range. In terms of earnings results, this marks the 13th straight positive surprise -- you need to go back to fiscal Q3 2015 for the last time Micron missed expectations. After hours, MU shares are trading up 2+%.
However, the stock is still down more than 20% since this past spring, and part of this has to do with NAND and DRAM businesses -- at which Micron excels -- is losing steam. So while Micron itself is bringing in 50% more revenues from the year-ago quarter, investors don't currently have much faith in the company's overall business environment. Prior to its earnings report, Micron carried a Zacks Rank #4 (Sell) with a Zacks Style Score (Value - Growth - Momentum) of A. For more on MU's earnings, click here.
The company's conference call, scheduled to get underway a few minutes from now, will be crucial to the fortunes of this stock going forward. Guidance will play a critical role in where Micron -- an its sub-industries -- can be expected to go from here. Right now, the company estimates $2.88 per share for its November (Q1 2019) quarter, and $8.35 billion on the top line.
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About the Bull and Bear of the Day
Every day, the analysts at Zacks Equity Research select two stocks that are likely to outperform (Bull) or underperform (Bear) the markets over the next 3-6 months.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous analyst coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
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