Owens Corning, Cheesecake Factory, Alphabet's, General Motors and Tesla highlighted as Zacks Bull and Bear of the Day
For Immediate Release
Chicago, IL –July 24, 2017 – Zacks Equity Research highlights Owens Corning (NYSE: OC – Free Report) as the Bull of the Day Cheesecake Factory (NASDAQ: CAKE – Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Alphabet’s (NASDAQ: GOOGL – Free Report), General Motors (NYSE: GM – Free Report) and Tesla (NASDAQ: TSLA – Free Report).
Here is a synopsis of all five stocks:
Bull of the Day :
The building products world has a pretty bright future in today’s economic environment. Things are humming along in a variety of different areas, with home construction picking up—as evidenced by the recent housing starts report—and low supply in a number of key locations (along with high rent prices) suggests that plenty of construction will need to take place in order to get the market into more of a balance.
That is why looking to companies like Owens Corning (NYSE: OC – Free Report) could be an excellent idea right now. OC is in a number of different corners of the building community, but especially pertinent to our discussion today is its roofing business (which is its biggest by revenue) and the insulation segment.
Both of these areas have been picking up steam in recent months, and could be in a position to continue this trend in the quarters to come too. These hopes for a continuation of the positive trend are especially apparent if we look to the recent earnings for Owens Corning, as well as some of the latest analyst estimate changes for the stock.
Estimates & Earnings
The surging trends in OC are evident if we look to the most recent earnings report. The company beat earnings estimates by nearly 40% for the most recent quarter, while net sales increased in all three of its main divisions. Additionally, the roofing division, which is key to our discussion, saw nearly 46% growth in terms of sales for year-over-year results.
Clearly, the positive trends are already starting to materialize. But what do analysts think about the near-future for OC? Well, we have seen two estimates go higher in the past week for both the current quarter and the current year, while the longer-term trend has also been positive too.
Bear:
I am a big fan of the Cheesecake Factory (NASDAQ: CAKE – Free Report), and especially their Grand Lux division.
Their portions are enormous and the selection is quite impressive; it is definitely one of my favorites for the price range.
However, this is a classic case of a good product not necessarily translating over into an excellent stock investment. This is especially apparent if you look to not only the company’s recent performance—including its last earnings report which missed estimates—but also the latest changes to the estimate picture from covering analysts.
Recent Estimates
In fact, we have seen eight estimates go lower for the current quarter in the past sixty days compared to zero higher, while we have seen similar trends for the full year and next year time frames as well. The next year estimates are especially notable on this front, as we have seen ten estimates go lower compared to zero higher for the time frame, suggesting long-term weakness could be at play here.
And it isn’t as though analysts are just cutting estimates by a penny either, as we have seen a noticeable shift lower to the consensus estimate in the past two months. The current quarter consensus has fallen by over 11% in the past sixty days, while the current year consensus has slumped by over five percent in the same time frame.
The most recent estimates have been even worse, potentially pushing the consensus estimate even lower in the process. In fact, the earnings ESP for CAKE is -6.6% for the current quarter, and it is in negative territory for the current year and next year readings too.
Additional content:
Lyft Plans Its Own Self-Driving Technology
Lyft has announced plans to develop a hardware and software kit that will enable self-driving cars. The ride-hailing company will open its own autonomous driving facility in Palo Alto, California.
Until now, Lyft has partnered with other companies, like Alphabet’s (NASDAQ: GOOGL – Free Report) Waymo and the carmaker General Motors (NYSE: GM – Free Report), to develop autonomous driving by providing their ride-hailing network.
This move is part of what Lyft calls its “Open Platform Initiative,” a strategy to develop its own autonomous vehicle technology alongside automakers and technology companies.
“We want to bring the whole industry together with this, and we think there’s a unique opportunity in time right now for Lyft to become a leader while doing it,” said Raj Kapoor, Lyft’s chief strategy officer. “For self-driving to work as an industry, there has to be more sharing.”
“Lyft is also uniquely positioned to build technology in collaboration with partners in a way that will make it possible to roll-out self-driving cars at a scale in the fastest, safest, most efficient way,” said Luc Vincent, Lyft’s vice president of engineering.
This new move could help Lyft compete with its rival, Uber, which already has three facilities dedicated to self-driving research. Uber hit a setback, however, when it became entangled in a lawsuit battle with Waymo over their LIDAR technology. Uber has also been facing problems in the wake of scandals that led to the resignation of CEO Travis Kalanick last month.
Lyft said that it doesn’t see self-driving cars as completely erasing drivers from its business. It hopes to create a “hybrid” network in which customers can request whether they want a driver or a self-driving car.
Tesla (NASDAQ: TSLA – Free Report) is one tech company that Lyft could look to for its progress on hybrid programs. In 2014, Tesla introduced the driver assist program Autopilot, which uses self-driving technology in coordination with a driver. The system can be used on and off the highway with limited functions like auto-steering, lane changing, and parking.
Lyft plans to recruit new engineering and technical people for the opening of the facility in a few weeks.
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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.
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Owens Corning Inc (OC) : Free Stock Analysis Report
The Cheesecake Factory Incorporated (CAKE) : Free Stock Analysis Report
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Tesla Inc. (TSLA) : Free Stock Analysis Report
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