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Brigham Minerals and QuinStreet have been highlighted as Zacks Bull and Bear of the Day

For Immediate Release

Chicago, IL – September 21, 2022 – Zacks Equity Research shares Brigham Minerals MNRL as the Bull of the Day and QuinStreet Inc QNST as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Chevron CVX, Albemarle ALB, and W.W. Grainger GWW.

Here is a synopsis of all five stocks.

Bull of the Day:

Brigham Minerals is a Zacks Rank #1 (Strong Buy) and it sports a D for Value and a B for Growth.  I like when I see the divergence in growth and value scores as it tells me that I am on the right path.  This company is in the mineral space and the company is focused on acquiring mineral rights in unconventional shale plays throughout the United States. Let’s explore more about this company in this Bull of The Day article.

Description

Brigham Minerals Inc. is a mineral acquisition company. It is focused on acquiring oil and gas mineral rights in unconventional, shale plays throughout the United States - including the Delaware and Midland Basins in Texas, the SCOOP and STACK plays in Oklahoma, the DJ Basin in Colorado and Wyoming, as well as the Bakken and Three Forks plays in North Dakota. Brigham Minerals Inc. is based in Austin, Texas.

Earnings History

When I look at a stock, the first thing I do is look to see if the company is beating the number.  This tells me right away where the market’s expectations have been for the company and how management has communicated to the market.  A stock that consistently beats has management communicating expectations to Wall Street that can be achieved.  That is what you want to see.

For MNRL, I see three beats and one miss of the Zacks Consensus Estimate.  That is great to see, but by itself that is not enough to make the company a Zacks Rank #1 (Strong Buy).

The average positive earnings surprise over the course of the last year works out to be 14%.

Earnings Estimates Revisions

The Zacks Rank tells us which stocks are seeing earnings estimates move higher.

Over the last 60 days, earning estimates have moved up for MNRL.

The quarter has moved from $0.64 to $0.65.

Next quarter has seen a bigger move, from $0.61 to $0.65.

The full fiscal year 2022 has increased from $2.64 to $2.74

Next fiscal year has seen the estimate move from $2.06 to $2.22.s

Positive movement in earnings stock is a Zacks Rank #1 (Strong Buy).

Valuation

The valuation for this name is very attractive.  I see the forward earnings multiple works out to be less than 10x and that is super cheap for a name that has posted topline growth of 140% in the most recent quarter.  Price to book comes in a 2.1x which should keep value investors interested in the name.

Margins have seen a dramatic increase over the last three quarters.

The operating margin was 31.2, then it moved to 36.5 and most recently came in at 41.2.  Those are impressive moves in operating margins and show the company is capable of posting higher EPS numbers.

Bear of the Day:

QuinStreet Inc is a Zacks Rank #5 (Strong Sell) as we head into a recession.  Why do I mention the recession?  Well generally we see the service related stocks take it on the chin first… and more to that point the service related stocks that are in the advertising space. This article will look at why this stock is a Zacks Rank #5 (Strong Sell) in this Bear of the Day article.

Description

QuinStreet Inc, is a provider of online direct marketing and media services. The Company offers online messaging, email broadcasting, search engine marketing, and brand management services. It caters to education, financial services, healthcare, advertising, and tourism sectors. QuinStreet, Inc. also operates web portal which offers comprehensive consumer information service and companion insurance brokerage service to self-directed insurance shoppers. The Company vigilantly manages brand and regulatory compliance using proprietary technologies and staff. It does not support or use spyware, spam, or promotions that cheat customers. QuinStreet Inc. is headquartered in Foster City, California.

Earnings History

When I look at a stock, the first thing I do is look to see if the company is beating the number.  This tells me right away where the market’s expectations have been for the company and how management has communicated to the market.  A stock that consistently beats has management communicating expectations to Wall Street that can be achieved.  That is what you want to see.

In the case of QNST, I see two meets of the  Zacks Consensus Estimate and two misses.  This alone does not make the stock a Zacks Rank #1 (Strong Buy) and it doesn’t make it a Zacks Rank #5 (Strong Sell) either.

The Zacks Rank does care about the earnings history, but it is much more heavily influenced by the movement of earnings estimates.

Earnings Estimates

The Zacks Rank tells us which stocks are seeing earnings estimates move higher or in this case lower.  For QNST see annual estimates moving lower.

The current fiscal year consensus number moved from $0.56  to $0.29 over the last 60 days.

The next year has moved from $0.75 to NA.

That NA could be due to the loss of coverage or a change in analysts that cover this stock.

Negative movement in earnings estimates like that is why this stock is a Zacks Rank #5 (Strong Sell).

It should be noted that a majority of stocks in the Zacks universe are seeing negative earnings estimate revisions.  That means that the stocks that are seeing small but negative earnings estimate revisions are falling to a Zacks Rank #5 (Strong Sell).

Additional content:

3 of the Best Dividend Aristocrats to Buy for a Solid Income

U.S. stocks are, at present, subject to bouts of volatility as Wall Street braces for the Fed’s two-day policy meeting slated to begin on Sep 20. Hopes of a less aggressive Fed were dashed after hotter-than-expected inflation raised concerns that the central bank may continue to tighten its monetary policy to tame a stubborn rise in prices of indispensable commodities and services.

Due to a drop in gas prices, the consumer price index (CPI) increased just 0.1% in August after remaining unchanged in July. However, analysts had estimated a decline of 0.1%.More importantly, the core rate of inflation that omits energy prices advanced 0.6%, more than analysts’ forecast of a gain of 0.3%. This broader increase in prices of goods and services cemented expectations that the Fed may hike interest rates by at least 75 basis points in its policy meeting that concludes on Sep 21.

In fact, some analysts now project an increase of a full percentage point, indicating that there will be more gyration in the stock market in the near future and that policymakers won’t get bogged down by a deepening selloff.

Lest we forget, interest rate hikes negatively impact the stock market. Rate hikes tend to curtail consumer outlays, increase the cost of borrowings, slow down economic growth, and in the process, impact the stock market. But investors shouldn’t get disheartened. In such a gloomy scenario, it’s prudent for them to buy dividend aristocrats like Chevron, Albemarle, and W.W. Grainger for a solid stream of income.

Being dividend aristocrats, these stocks have a fundamentally sound business that helps them stand out from other dividend players. They are known for providing profits for a pretty long time and have remained unperturbed in the middle of market volatility. These stocks flaunt a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.

Chevron is among the largest publicly traded multinational energy companies, whose acquisition of Nobel Energy did improve its average output last year. This Zacks Rank #2 company is known for having raised its dividend for over 35 consecutive years.

Chevron has a dividend yield of 3.63%. CVX’s payout ratio presently sits at 39% of earnings. In the past five-year period, CVX has increased its dividend five times and its payout has advanced 6%. Check Chevron’s dividend history here.

The Zacks Consensus Estimate for its current-year earnings has moved up 2% over the past 60 days. CVX’s expected earnings growth rate for the current year is 126.3%.

Albemarle is a specialty chemicals company, whose focus continues to remain on improving its lithium business. Thanks to its acquisition of Rockwood Holdings, the company is now expected to do well in the near term. This Zacks Rank #1 company is known for having raised its dividend for at least 25 successive years.

Albemarle has a dividend yield of 0.55%. ALB’s payout ratio presently sits at 20% of earnings. In the past 5-year period, ALB has increased its dividend five times, and its payout has advanced 4.8%. Check Albemarle’s dividend history here.

The Zacks Consensus Estimate for its current-year earnings has moved up 63.7% over the past 60 days. ALB’s expected earnings growth rate for the current year is 425.3%.

W.W. Grainger is primarily the distributor of maintenance, repair and operating (MRO) products and services. The company’s initiative to reduce its inventory, and pricing actions should certainly aid growth. This Zacks Rank #2 company has increased its dividend for more than 25 consecutive years.

W.W. Grainger has a dividend yield of 1.31%. GWW’s payout ratio presently sits at 27% of earnings. In the past 5-year period, GWW has increased its dividend five times, and its payout has advanced almost 6.1%. Check W. W. Grainger’s dividend history here.

The Zacks Consensus Estimate for its current-year earnings has moved up 6.6% over the past 60 days. GWW’s expected earnings growth rate for the current year is 41.5%.

Shares of Chevron, Albemarle and W. W. Grainger, by the way, have already gained 33.6%, 27% and 3.2%, respectively, in the year-to-date period.

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Chevron Corporation (CVX) : Free Stock Analysis Report
 
W.W. Grainger, Inc. (GWW) : Free Stock Analysis Report
 
Albemarle Corporation (ALB) : Free Stock Analysis Report
 
QuinStreet, Inc. (QNST) : Free Stock Analysis Report
 
Brigham Minerals, Inc. (MNRL) : Free Stock Analysis Report
 
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