Monday, October 28, 2024

The Zacks Research Daily presents the best research output of our analyst team. Today's Research Daily features new research reports on 16 major stocks, including Meta Platforms, Inc. (META), Tesla, Inc. (TSLA) and Thermo Fisher Scientific Inc. (TMO), as well as a micro-cap stock Where Food Comes From, Inc. (WFCF). The Zacks microcap research is unique as our research content on these small and under-the-radar companies is the only research of its type in the country.

These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.

You can see all of today’s research reports here >>>

Meta Platforms’ shares have outperformed the Zacks Internet - Software industry over the year-to-date period (+64.0% vs. +23.5%). The company is benefiting from steady user growth across all regions, particularly Asia Pacific. Increased engagement for its offerings like Instagram, WhatsApp, Messenger and Facebook has been a major growth driver.

META has been leveraging AI to improve the potency of its platform offerings. These services currently reach more than 3.2 billion people daily. User growth remained solid in the United States, with WhatsApp reaching more than 100 million monthly users and Thread approaching 200 million milestone.

It witnessed good year-over-year growth across Facebook, Instagram and Threads. Meta now expects to invest significantly more over the next few years in developing more advanced models and the largest AI services in the world. However, monetization of these AI services will take considerable time, which is a concern.

(You can read the full research report on Meta Platforms here >>>)

Shares of Tesla have outperformed the Zacks Automotive - Domestic industry over the year-to-date period (+12.0% vs. -1.4%). The company’s long-term growth prospects remain strong, driven by its thriving Energy Generation & Storage segment, expansive Supercharger network and AI advancements. Energy deployments are expected to double this year, thanks to the strong reception of its Megapack and Powerwall products.

Tesla’s robust balance sheet, with a high liquidity buffer, supports continued innovation and expansion. Progress in the autonomous vehicle domain, including plans to launch robotaxi services in 2025, position the company well for sustained growth.

However, near-term pressure from high capex, stiff EV competition and margin challenges in the automotive segment pose risks. Still, Tesla’s commitment toward clean energy, along with its pioneering technology and robust infrastructure, underpins our bullish long-term view of the stock.

(You can read the full research report on Tesla here >>>)

Thermo Fisher Scientific’s shares have gained +27.4% over the past year against the Zacks Medical - Instruments industry’s gain of +33.4%. The company is braving the ongoing tough economic conditions by utilizing the PPI Business System, resulting in strong financial performance.

Thermo Fisher’s growth strategy has been bolstered by several recent product launches, including a pre-transplant risk assessment assay and the international CorEvitas Adolescent Atopic Dermatitis (AD) Registry in the third quarter. The consistent efforts to expand its bioproduction business look encouraging.

Thermo Fisher’s continuous efforts to prioritize its partnership with customers to drive innovation and improve patient care bode well. A strong solvency position is an added advantage. The raised 2024 EPS outlook also raises optimism. However, the year-over-year decline in revenues in Life.

(You can read the full research report on Thermo Fisher Scientific here >>>)

Shares of Where Food Comes From have underperformed the Zacks Consumer Services - Miscellaneous industry over the past year (-18.5% vs. +20.0%). This microcap company with market capitalization of $60.85 million demonstrates strong revenue growth in its core verification services, up 13% year over year to $9.7 million in the first half of 2024, driven by the rising demand for transparency in food production.

Expansions into the Upcycled Food Certification and biosecurity services position WFCF for growth, capitalizing on sustainability trends. The company’s diversified revenue streams mitigate risks from cyclical industry pressures, such as challenges in the beef sector.

Yet, declining product sales, particularly in RFID tags, and rising SG&A expenses, which increased 13% year over year in second-quarter 2024, pose risks to profitability. The cyclical downturn in the cattle industry continues to pressure WFCF’s revenues. Concerns about cash flow sustainability arise despite share buybacks, especially if economic challenges persist.

(You can read the full research report on Where Food Comes From here >>>)

Other noteworthy reports we are featuring today include Citigroup Inc. (C), Regeneron Pharmaceuticals, Inc. (REGN) and General Dynamics Corp. (GD).

Mark Vickery
Senior Editor

Note: Sheraz Mian heads the Zacks Equity Research department and is a well-regarded expert of aggregate earnings. He is frequently quoted in the print and electronic media and publishes the weekly Earnings Trends and Earnings Preview reports. If you want an email notification each time Sheraz publishes a new article, please click here>>>