For Immediate Release
Chicago, IL – March 31, 2020 – Zacks Equity Research highlights eXp World Holdings EXPI as the Bull of the Day and Columbia Sportswear COLM as the Bear of the Day. In addition, Zacks Equity Research provides analysis onWalmart WMT, Target TGT and Amazon AMZN.
Here is a synopsis of all five stocks:
Bull of the Day:
The Western World will never be the same. The COVID-19 pandemic is as earth-shattering as 9/11 in many ways. This generational event will bring about a dramatic shift in our everyday lives. At the very least, it’s going to reshape the economy. There are entire industries that are going to have to change the way they do business. In some cases, those businesses won’t be needed any more. To draw a parallel from the animal world, it’s adapt or die.
Today’s Bull of the Day is a stock from an industry at risk, real estate. However, their forward-thinking approach is changing the way this industry does business. I’m talking about Zacks Rank #1 (Strong Buy) eXp World Holdings.
eXp World Holdings, Inc. provides cloud-based real estate brokerage services for residential real estate market in the United States and Canada. The company facilitates buyers to search real-time property listings and sellers to list their properties through its Website, exprealty.com; and provides buyers and sellers access to a network of professional, consumer-centric agents, and brokers. It also offers access to collaborative tools and training services for real estate brokers and agents. In addition, the company provides marketing, training, and other support services to its brokers and agents through proprietary technology enabled services, and technology and support services contracted to third parties.
Earnings estimates have been moving in a positive direction. Over the last thirty days, analysts have increased their earnings estimates for the current year and next year. The bullish sentiment has pushed up our Zacks Consensus Estimate for the current year from an 8-cent loss to a one-cent gain. Next year’s number is up from 18 cents to 21 cents.
The revenue growth is the real story here. Current quarter estimates call for 52.7% revenue growth with next quarter slated to come in at 49.8%. That helps the current year estimate round out at 46.2%. Companies can apply all sorts of trickery in order to meet those EPS estimates, but it’s much tougher to get those revenue numbers up. Solid revenue growth here gives some downside cushion.
Bear of the Day:
In a world where we are all hunkering down and avoiding being outside, there are going to be some casualties. I don’t mean in the morbid sense, but rather, in the economic sense. Imagine being a retailer right now. Even those with strong online presences are taking damage. Those without, are sunk. This could be the death blow for many malls all across the country. The pain is being felt all along the retail supply chain.
Today’s Bear of the Day is a stock in the Textile – Apparel business which ranks in the Bottom 7% of our Zacks Industry Rank. It’s Zacks Rank #5 (Strong Sell) Columbia Sportswear. Columbia Sportswear Company, together with its subsidiaries, designs, sources, markets, and distributes outdoor, active, and everyday lifestyle apparel, footwear, accessories, and equipment in the United States, Latin America, the Asia Pacific, Europe, the Middle East, Africa, and Canada. The company provides apparel, accessories, and equipment that are used in various activities, such as skiing, snowboarding, hiking, climbing, mountaineering, camping, hunting, fishing, trail running, water sports, yoga, golf, and adventure travel.
Prior to the COVID-19 pandemic, Columbia was already feeling some pain. Analysts across Wall Street had already begun to cut their estimates. Six analysts cut their earnings estimates for the current year over the last sixty days. That bearish sentiment dropped the Zacks Consensus Estimate for the current year from $5.13 all the way to $3.98. Next quarter’s number alone was cut from a 24-cent profit to a 5-cents-per-share loss. This sets the company’s earnings up to contract 17.6% this year.
Investors looking for other stocks within the same industry have several Zacks Rank #3 (Hold) stocks to investigate further, but nothing ranked higher than that.
Coronavirus Crisis Boosts Grocery Apps Download: Stocks to Gain
Grocery delivery apps in the United States are seeing record downloads, as people are increasingly avoiding stepping out of their homes in the wake of the coronavirus outbreak that has claimed more than 2,000 lives in the country so far, with confirmed cases exceeding 0.1 million. This is supported by recent data published by app tracking firm Apptopia.
According to the data, average daily downloads in February till Mar 15 for Instacart, Walmart grocery and Shipt apps increased 218%, 160%, and 124%, respectively, thus adding to their profits.
What’s Behind the Spurt in Downloads?
Following the U.S. government’s mandate to practice “social distancing” and imposition of partial lockdown in some states, long queues of people were initially observed in front of stores. This was totally contradictory to the agenda of social distancing and raised the probability of the pandemic’s spread further.
With an increase in the number of positive cases, people have now realized the significance of social distancing and are thus staying home. As a result more people have started to depend on online grocery delivery apps, which present an easier option to shop for essentials. With grocery pickup, consumers only have to interact with a single store employee, while with grocery delivery most orders can simply be left on the doorstep with no person-to-person contact required.
The surge in download of grocery delivery apps was witnessed following the launch of “contactless” delivery option. In this regard, Instacart said its sales growth rates for the week of Mar 15 was 10 times higher than the week before, and had increased by as much as 20 times in areas like California, New York, Washington and Oregon.
Stocks to Gain
Herein, we have mentioned the stocks that are expected to show signs of solid growth in the coming quarters, thanks to their grocery delivery apps, which are seeing increased traction. Meanwhile, they also have a favorable Zacks Rank and solid long-term growth value, therefore making them worthy enough to be included into one’s watchlist.
Per the data by Apptopia, Walmart’s grocery app saw nearly 54,000 downloads on Mar 15. Notably, one-third of shoppers surveyed by Gordon Haskett Research Advisors on Mar 13 said they bought food online over the past week, and of those, 41% were doing so for the first time. For those newbies, Walmart was by far the most popular option, capturing more than half of orders.
In this context it is imperative to mention the fact that, Walmart recently reported that its online sales increased 37% for fiscal-year 2020, which ended on Jan 31, with stronggrowth in online grocery deliveries and pickups being the primary driver. Considering the recent download trends of Walmart Grocery in the backdrop of COVID 19, we may expectits online grocery business to consistently boost the top line of this retail giant. The long-term earnings growth expectation for this Zacks Rank #3 (Hold) stock is 4.9%.
Target’s Shipt app, though hit record numbers, saw only 7,285 downloads on Mar 15, perhaps owing to Target’s move to integrate Shipt’s grocery delivery service into its main app. Nevertheless, Target’s main app saw more than 53,100 daily downloads, breaking the record for daily downloads. Looking ahead, according to the recent projection made by analyst firm eMarketer, Target’s e-commerce business will jump 24% annually to $8.34 billion in 2020, which means the company’s share in the U.S. ecommerce market will grow to 1.2% from 1.1% in 2019.
Surely the sharp spike in Shipt app’s download and consequent order flows will significantly contribute to this growth. The long-term earnings growth expectation for this Zacks Rank #3 stock is 7.9%.You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Apptopia’s analysis did not include the impact of the coronavirus outbreak on Amazon’s grocery delivery business, which includes Amazon Fresh and Whole Foods deliveries. However, per an Amazon spokeswoman’s statement given to Bloomberg, the company is witnessing a significant increase in online grocery shopping of late.
In fact, to meet rising online demand, Amazon is offering higher pay to recruit its own warehouse employees to pick and pack Whole Foods groceries, according to an internal document reviewed by Reuters. The company has also announced the hiring of 100,000 full and part-time positions across the United Statesto meet the huge backlog of AmazonFresh and Whole Foods delivery orders. The long-term earnings growth expectation for this Zacks Rank #2 (Buy) stock is 24%.
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Click to get this free report Target Corporation (TGT) : Free Stock Analysis Report Columbia Sportswear Company (COLM) : Free Stock Analysis Report Amazon.com, Inc. (AMZN) : Free Stock Analysis Report Walmart Inc. (WMT) : Free Stock Analysis Report Exp World Holdings, Inc. (EXPI) : Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research