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The Zacks Analyst Blog Highlights: Dropbox, CrowdStrike, DocuSign and Microsoft

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Zacks Equity Research
·7 min read
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For Immediate Release

Chicago, IL – December 31, 2020 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Dropbox, Inc. DBX, CrowdStrike Holdings, Inc. CRWD, DocuSign, Inc. DOCU and Microsoft Corporation MSFT

Here are highlights from Wednesday’s Analyst Blog:

These 4 Work-from-Home Stocks Should Keep Soaring in 2021

Providers of work-from-home software, storage, security and services have benefited the most from the coronavirus crisis. The pandemic has changed the employment landscape. Although working from home isn't a new phenomenon, it became a necessity amid the virus outbreak.

Employees too are now comfortable working remotely. Needless to say, this new normal is spurring demand for computer hardware, peripherals, network software and cloud business.

As vaccination programs will take several months to cover a major portion of the global population, social-distancing measures are required to keep the infection rate flat. This will need continuation of work from home, which in turn would continue to drive demand for video conferencing, productivity and collaboration software.

Moreover, growing usage of cloud-based services is aggravating security lapses, inducing risks of hacking and phishing mails in the garb of coronavirus as content of the subject. Additionally, usage of own devices and equipment that are not properly configured or can be infected with malware during teleworking or accessing information from cloud raises possibilities of security breaches for enterprises. This is driving demand for cloud-based security service solutions.

Here we discuss four stocks that have benefited from the work-from-home trend and are well poised to gain from the solid prospects of continued remote working.

Dropbox stock has spiked 28% in the year-to-date period. The company is riding on growing demand for its cloud-based team collaboration tools through which users can share files, photos, videos, songs and spreadsheets.

This Zacks Rank #2 (Buy) company's strong focus on product innovation and introduction of solutions like updated Dropbox Spaces, HelloSign, Passwords, Vault and Computer Backup are anticipated to expand its user base. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Solid demand for cloud storage, triggered by the coronavirus-led work-from-home wave, has been acting as a tailwind for the company. Further, integration with leading applications like Zoom, Slack and Atlassian will likely expand the Dropbox paying user base.

Additionally, Dropbox's innovative "Virtual First" initiative, under which employees will work from home majority of the time and will meet once in a while for team collaboration, is expected to lower cost. The company's plan to shift to hiring in low-cost regions is likely to boost profitability.

The Zacks Consensus Estimate for 2020 earnings stands at 88 cents per share, up 14.3% in the past 60 days. The consensus mark for its 2021 earnings is pegged at $1 per share, having been revised 9.9% upward over the same time frame.

CrowdStrike Holdings is benefiting from rising demand for cyber-security solutions amid several data breaches and the urgency for security and networking products, prompted by the COVID-19 pandemic-led remote working trend. Moreover, continued digital transformation and cloud-migration strategies adopted by organizations are key drivers for this presently Zacks Rank #2 company.

CrowdStrike's portfolio strength, mainly the Falcon platform's 10 cloud modules, boosts its competitive edge and helps to add users. Further, the company's next-generation antivirus EDR and device-control products are well poised to gain from the thriving remote work culture.

The company's shares have been up a whopping 312.9% year to date. The consensus mark for its 2021 bottom line is pegged at 22 cents per share, having been revised a whopping 266.7% upward in the past 30 days. For fiscal 2022, the consensus mark for earnings has moved 33.3% north to 32 cents per share over the same time frame.

DocuSign provides e-signature solutions. The company's software provides a proof of signing process to all parties related to a transaction. DocuSign is poised to benefit from the growing number of off-site and work-from-home availing employees amid coronavirus fears.

Furthermore, the long-term outlook of DocuSign looks impressive owing to a rising freelance market, as governments and organizations are finding it more convenient and cost effective in hiring freelancers than employing full-time staff. This Zacks Rank #3 (Hold) company has software integration partnerships with Microsoft, Salesforce, Oracle, and others, which is likely to continue boosting its user base.

The Zacks Consensus Estimate for fiscal 2021 earnings is pegged at 74 cents per share, having been revised 34.5% upward in 30 days' time. For fiscal 2022, the consensus mark for earnings has moved 28.2% north to $1.09 per share over the same time frame. Shares of DocuSign have soared 207.9% in the year so far.

Microsoft's Office 365 commercial suite paid version enables team members to share files, schedule meetings directly from Outlook, record meetings and collaborate on documents using the desktop Office programs and SharePoint Online.

Microsoft is an all-rounder with encouraging prospects across cloud computing, AI, 5G, edge computing, gaming, enterprise communication and PC markets. The company is well poised to gain from expanding Azure clientele, solid momentum in Teams and growing user base of different applications including Microsoft 365 commercial, Dynamics, and Outlook mobile.

The company is also taking gaming to new highs with the launch of next generation Xbox Series X and S consoles. Further, a positive trend in PC shipments remains a tailwind for its latest Surface devices.

The Zacks Consensus Estimate for fiscal 2021 earnings increased by 5 cents to $6.73 per share over the past 60 days, highlighting bullish sentiments for the stock. Notably, shares of this Zacks Rank #3 company have returned 43.6% year to date.

Zacks Top 10 Stocks for 2021

In addition to the stocks discussed above, would you like to know about our 10 top tickers for the entirety of 2021?

These 10 are painstakingly hand-picked from over 4,000 companies covered by the Zacks Rank. They are our primary picks to buy and hold.

Start Your Access to the New Zacks Top 10 Stocks >>

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.


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Microsoft Corporation (MSFT) : Free Stock Analysis Report
 
DocuSign Inc. (DOCU) : Free Stock Analysis Report
 
Dropbox, Inc. (DBX) : Free Stock Analysis Report
 
CrowdStrike Holdings Inc. (CRWD) : Free Stock Analysis Report
 
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