Yahoo Finance Lamb Weston and TTEC Holdings have been highlighted as Zacks Bull and Bear of the Day
For Immediate Release
Chicago, IL – April 27, 2023 – Zacks Equity Research shares Lamb Weston LW as the Bull of the Day and TTEC Holdings TTEC as the Bear of the Day. In addition, Zacks Equity Research provides analysis on CVS Health Corp. CVS, Bio-Rad Laboratories BIO and Henry Schein, Inc. HSIC.
Here is a synopsis of all five stocks.
Bull of the Day:
The Zacks Consumer Staples sector has outperformed the S&P 500 over the last month, penciling in roughly a 4% gain and indicating favorable momentum.
One stock in the sector, Lamb Weston, has seen its earnings outlook turn visibly bright across all timeframes in the recent term, landing the stock into the highly-coveted Zacks Rank #1 (Strong Buy).
Lamb Weston is a leading global manufacturer, marketer and distributor of value-added frozen potato products. The company operates through three segments: Global, Foodservice, and Retail. Let’s take a deeper dive into how the potato titan currently stacks up.
Share Performance
While the market’s rebound in 2023 has been remarkable, LW’s share performance has been even more remarkable, up a strong 24% and reflecting great relative strength.
And over the last year, LW shares have again provided market-beating returns, up nearly 68% and crushing the general market’s performance.
The favorable price action within shares clearly indicates positive sentiment, with buyers well in control just not in 2023 but over the last year as well.
Valuation
LW shares may not entice value-focused investors, with the stock carrying a Style Score of “D” for Value.
Lamb Weston shares presently trade at a 24.3X forward earnings multiple, a few ticks below the 25.9X five-year median and well above the Zacks Consumer Staples sector average of 19.7X.
In addition, the company’s forward price-to-sales ratio currently sits at 3.1X, marginally above the five-year median and below the Zacks Consumer Staples sector average.
Quarterly Performance
The company has delivered big as of late, exceeding the Zacks Consensus EPS Estimate by double-digit percentages in six consecutive quarters. Just in its latest release, Lamb Weston penciled in a 46% EPS beat paired with a 6.5% positive sales surprise.
Shares have regularly gotten a boost post-earnings.
Keep an eye out for LW’s next quarterly release expected on July 26th; the Zacks Consensus EPS Estimate of $1.05 suggests an improvement of more than 60% from the year-ago quarter.
Dividends
Everybody loves dividends, as they provide a boost to any portfolio and provide a passive income stream. Fortunately for investors, LW has little problem increasingly rewarding its shareholders, carrying a 7% five-year annualized dividend growth rate.
The company’s annual dividend currently yields 1%, below the Zacks Consumer Staples average. Still, the dividend growth helps pick up the slack.
Bottom Line
Investors can implement a stellar strategy to find expected winners by taking advantage of the Zacks Rank – one of the most powerful market tools that provides a massive edge.
Additionally, the top 5% of all stocks receive the highly coveted Zacks Rank #1 (Strong Buy). These stocks should outperform the market more than any other rank.
Lamb Weston would be an excellent stock for investors to keep on their watchlists, as displayed by its Zack Rank #1 (Strong Buy).
Bear of the Day:
With the market staging a big comeback in 2023 so far, many companies have seen their earnings outlook shift positively.
However, the outlook hasn’t been as bright for all, including TTEC Holdings. The company has seen its bottom line outlook turn sour over the last several months, pushing it down into an unfavorable Zacks Rank #5 (Strong Sell).
TTEC Holdings (formerly known as TeleTech) is a global customer experience (CX) technology and services company focused on the design, implementation, and delivery of exceptional customer experiences. Let’s take a closer look at how the company currently stacks up.
Share Performance
TTEC shares have faced notable selling pressure year-to-date, down roughly 25% and widely underperforming relative to the general market.
And over the last year, the picture primarily remains the same; TTEC shares have struggled to find lasting momentum, down more than 50% and again underperforming relative to the S&P 500.
Valuation
Shares aren’t expensive on a relative basis, with the company’s 14.4X forward earnings multiple sitting well below the 19.3X five-year median and the Zacks Business Services sector average.
In addition, TTEC’s forward price-to-sales ratio of 0.6X resides on the lower end of the spectrum, again well below the 1.2X five-year median.
TTEC carries a Style Score of “B” for Value.
Quarterly Performance
TTEC posted better-than-expected results in its latest release, exceeding the Zacks Consensus EPS Estimate by more than 20% and delivering a positive 4.7% revenue surprise.
However, the market had a poor reaction post-earnings, sending shares on a downward trajectory.
Bottom Line
Negative earnings estimate revisions from analysts paint a challenging picture for the company’s shares in the near term.
TTEC Holdings is a Zacks Rank #5 (Strong Sell), indicating that analysts have taken a bearish stance on the company’s earnings outlook over the last several months.
For those seeking strong stocks, a great idea would be to focus on stocks carrying a Zacks Rank #1 (Strong Buy) or a Zacks Rank #2 (Buy) – these stocks sport a notably stronger earnings outlook paired with the potential to deliver explosive gains in the near term.
Additional content:
What Can We Expect from CVS Earnings Next Week?
CVS Health Corp. is scheduled to report first-quarter 2023 results on May 3, before the opening bell.
In the last reported quarter, the company’s adjusted earnings of $1.99 exceeded the Zacks Consensus Estimate by 3.1%. The company beat estimates in the trailing four quarters, the average surprise being 5.88%.
Let’s look at how things have shaped up for CVS Health prior to this announcement.
Factors in Play
CVS Health’s retail/long-term care segment is likely to have benefited from the increased prescription and front store volume, similar to the fourth quarter 2022. The company’s efforts to optimize the retail portfolio, which now consists of three models, including advanced primary care clinics, enhanced health hub locations and traditional CVS pharmacy locations, are likely to have been advantageous for the upcoming Q1 results.
CVS Health has been making noteworthy progress in expanding access to care through digital and virtual channels. During the fourth quarter 2022, CVS Health increased unique digital customers by seven million to over 47 million and reached eight million active users on it’s individualized Health Dashboard. The company also interacted with nearly five million customers daily across the community footprint. We believe this development to have benefited the company’s first-quarter 2023 revenues significantly.
The company also launched a variety of new MinuteClinic virtual care services to support women's health that will be available 24/7. CVS Health’s contained efforts to expand digital health services and deepen engagement through personalization are expected to have broadened its customer base in Q1, thus adding to its top line.
CVS Health Corporation price-eps-surprise | CVS Health Corporation Quote
In January 2023, CVS Health collaborated with RUSH University System for Health (RUSH) to expand access for Medicare patients to RUSH clinical services in the Chicago area. The collaboration enables patients seeking health services at various ACO REACH-participating MinuteClinic locations in Chicago and Evanston to access follow-up primary and speciality care with RUSH and other ACO REACH entities. This development is expected to have boosted CVS Health’s performance in the to-be-reported quarter.
The pharmacy services segment is expected to have recorded robust sales growth, banking on increased pharmacy sales and prescriptions filled, driven by demand for consumer health and cough, cold, and flu products. Also, growth in specialty pharmacy and brand inflation is also likely to have been contributing factors in the pharmacy services arm. We are also positive about the company’s newly developed comprehensive set of programs to manage specialty trends, which includes a formulary exclusion strategy.
Moreover, we also expect drug price inflation, new product launch, higher utilization and new PBM clients to fuel growth. This would simplify and accelerate the process of filling prescriptions, thus benefiting the business performance in Q1.
The healthcare benefits arm is likely to have been driven by sustained membership growth across all product lines. During the fourth quarter 2022, medical membership increased by 109,000 members, reflecting increases across all product lines. The segment witnessed favorable development of prior periods’ healthcare cost estimates in its Government Services and Commercial businesses during the fourth quarter 2022. We expect this growth momentum to continue. Further, CVS Health’s competitive cost structure, integrated benefit designs and innovative product portfolio position the healthcare benefits business for further growth.
Key Q1 Estimates
The Zacks Consensus Estimate for first-quarter 2023 adjusted earnings of $2.10 per share implies a 5.4% fall from the year-ago reported figure.
The consensus estimate for revenues is pegged at $81.60 billion, suggesting 6.2% fall from the prior-year reported number.
What Our Model Suggests
Per our proven model, a stock with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) along with a positive Earnings ESP has a higher chance of beating estimates. However, this is not the case here, as you can see:
Earnings ESP: The company has an Earnings ESP of -0.76%. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company currently carries a Zacks Rank #4 (Sell).
Stocks Worth a Look
Here are some medical stocks which have the right combination of elements to post an earnings beat this quarter, per our model.
Bio-Rad Laboratories has an Earnings ESP of +0.16% and sports a Zacks Rank of 1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The company is slated to release first-quarter 2023 results on May 4.
Bio-Rad has a 2023 expected earnings growth rate of 10.3%. BIO’s earnings yield of 3.38% compares favorably with the industry’s yield (2.78%).
Henry Schein, Inc. has an Earnings ESP of +0.99% and sports a Zacks Rank of 1. Henry Schien is expected to release first-quarter fiscal 2023 results on May 2.
HSIC’s earnings surpassed estimates in three of the trailing four quarters and matched once, the average beat being 2.9%. HSIC’s 2024 growth rate is estimated to be 7.7%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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Henry Schein, Inc. (HSIC) : Free Stock Analysis Report
CVS Health Corporation (CVS) : Free Stock Analysis Report
TeleTech Holdings, Inc. (TTEC) : Free Stock Analysis Report
Bio-Rad Laboratories, Inc. (BIO) : Free Stock Analysis Report
Lamb Weston (LW) : Free Stock Analysis Report
