Tuesday, March 25, 2025

The Zacks Research Daily presents the best research output of our analyst team. Today's Research Daily features new research reports on 16 major stocks, including Microsoft Corp. (MSFT), NVIDIA Corp. (NVDA) and Alphabet Inc. (GOOGL), as well as a micro-cap stock Cooper-Standard Holdings Inc. (CPS). The Zacks microcap research is unique as our research content on these small and under-the-radar companies is the only research of its type in the country.

These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.

You can see all of today’s research reports here >>>

Ahead of Wall Street

The daily 'Ahead of Wall Street' article is a must-read for all investors who would like to be ready for that day's trading action. The article comes out before the market opens and attempts to make sense of that morning's economic releases and how they will affect that day's market action. You can read this article for free on our home page and can actually sign up there to get an email notification as this article comes out each morning.

You can read today's AWS here >>> Pre-Markets Swing Back into Green

Today's Featured Research Reports

Shares of Microsoft have underperformed the Zacks Computer - Software industry over the past year (-6.1% vs. -2.4%). The company’s Microsoft Office is facing declining commercial licensing due to the continued customer shift to cloud offerings is an overhang. Higher operating expenses and spending on Azure amid stiff competition in the cloud space from Google Cloud and Amazon Web Services remain concerns.

Nevertheless, Microsoft is benefiting from steady growth in its AI business and Copilot adoption amid decelerating growth in its Azure cloud infrastructure unit. Productivity and Business Processes revenues continue to rise due to strong adoption of Office 365 Commercial solutions. ARPU growth is driven by E5 as well as M365 Copilot.

Intelligent Cloud revenues are gaining from growth in Azure AI services and a rise in AI Copilot business. Non-AI growth trends are experiencing sluggishness due to go-to-market execution challenges. The Zacks analyst expect fiscal 2025 net sales to grow 12.7% from fiscal 2024.

(You can read the full research report on Microsoft here >>>)

NVIDIA’s shares have outperformed the Zacks Semiconductor - General industry over the past year (+31.2% vs. +23.7%). The company is benefiting from the strong growth of artificial intelligence (AI), high performance and accelerated computing. The growing demand for generative AI and large language models using graphic processing units (GPUs) based on NVIDIA’s Hopper and Blackwell architectures is aiding data center revenues.

Continued ramp-up of Ada RTX GPU workstations in the ProViz end market following the normalization of channel inventory is acting as a tailwind. The Zacks analyst expect NVIDIA’s revenues to witness a CAGR of 27.7% through fiscal 2026-2028. Collaborations with over 320 automakers and tier-one suppliers are likely to advance its presence in the autonomous vehicles space.

However, a limited supply of Blackwell and Ada GPUs could hinder its ability to meet demand. Rising costs associated with the production of more complex AI systems will hurt margins.

(You can read the full research report on NVIDIA here >>>)

Shares of Alphabet have outperformed the Zacks Internet - Services industry over the past year (+11.8% vs. +11.1%). The company is riding on strong cloud and search growth. Google Cloud is benefiting from accelerated growth across AI infrastructure, enterprise AI platform Vertex and strong adoption of Generative AI solutions.

Alphabet exited 2024 with an annual run rate of $110 billion for its Cloud and YouTube businesses. The company now expects to invest roughly $75 billion in capital expenditures in 2025, which is aimed to build up technical infrastructure, primarily for servers followed by data centers and networking.

Its dominant position in the search engine market is a strong growth driver. However, increasing litigation issues and expenses remain concerns. Rising cloud competition from Microsoft and Amazon is a concern.

(You can read the full research report on Alphabet here >>>)

Cooper-Standard’s shares have outperformed the Zacks Automotive - Original Equipment industry over the past year (+11.9% vs. -17.5%). This microcap company with market capitalization of $300.79 million have seen expanded margins despite lower revenue, with fourth-quarter adjusted EBITDA increasing 96.8% year-over-year to $54.3 million. Cost optimizations delivered over $100 million in savings, and management aims for double-digit margins by the fourth quarter of 2025.

Net new business reached $181.4 million, with 58% tied to electric vehicles, boosting content per vehicle. Proprietary innovations and partnerships with major original equipment manufacturers enhance competitiveness.

However, high debt of $1.06 billion and rising interest costs of $97.3 million in 2024, projected at $105 million to $115 million in 2025, pose risks. Cooper-Standard reported a net loss of $78.7 million in 2024 as revenue declined 3% to $2.73 billion. Weak global auto production, foreign exchange headwinds, and pricing pressure from automakers could challenge its 2025 margin target.

(You can read the full research report on Cooper-Standard here >>>)

Other noteworthy reports we are featuring today include Sony Group Corp. (SONY), GSK plc (GSK) and Diamondback Energy, Inc. (FANG).

Mark Vickery
Senior Editor

Note: Sheraz Mian heads the Zacks Equity Research department and is a well-regarded expert of aggregate earnings. He is frequently quoted in the print and electronic media and publishes the weekly Earnings Trends and Earnings Preview reports. If you want an email notification each time Sheraz publishes a new article, please click here>>>

Today's Must Read

Adoption of Cloud & Office 365 Strength Aid Microsoft (MSFT)

NVIDIA (NVDA) Benefits from Growing Adoption of GPUs

Alphabet (GOOGL) Benefits From Cloud & Search Initiatives

Featured Reports

GSK (GSK) Specialty Medicines Unit Strong; Vaccines Weak
GSK is witnessing increased sales growth of the Specialty Medicines unit. However, slowing sales in the Vaccines unit concerns the Zacks analyst

Diamondback (FANG) to Gain from Production Growth
The Zacks analyst believes that Diamondback Energy's technological advancements position it for sustainable production growth in the Permian Basin but is worried over increased capital expenditure.

Verisk (VRSK) Gains From Rocket Buyout, Low Liquidity Ails
Per the Zacks analyst, the Rocket buyout expands Verisk in Europe, and helps insurers and claim service providers improve claims experience. Declining liquidity is concerning.

Higher Order Rate to Aid Ingersoll Rand (IR) Amid High Costs
Per the Zacks analyst, higher orders across Ingersoll Rand's product portfolio of industrial vacuums, blowers and compressors will lend momentum to it. The company's high costs remain a woe.

Store Expansion Aid Extra Space Storage (EXR) Amid Low Rates
Per the Zacks Analyst, Extra Space Storage (EXR) is set to gain from a high brand value and its store expansion through accretive buyouts. Yet, lower new customer rates will hinder its revenue growth.

Robust Growth Model Aids Planet Fitness (PLNT), Costs Hurt
Per the Zacks analyst, Planet Fitness' implementation of the enhanced economic model and increased franchise agreements bode well. However, increased costs and ongoing macro risks hurt prospects.

BEAM's Gene-Therapy Pipeline Holds Promise Amid Competition
Per the Zacks analyst, BEAM's lead candidate, BEAM-101, a base-editing therapy being developed to treat a rare disease, holds promise. However, stiff competition in the target market remains a woe.

New Upgrades

Solid Momentum in Music and G&NS Segment Sales Benefit SONY
Per the Zacks analyst, strength in the Game & Network Services, notably software sales and Music units is driving Sony's performance. Higher operating income is a key catalyst.

Increasing Orders and New MRO Facilities Drive Embraer (ERJ)
Per the Zacks analyst, Embraer is likely to benefit from increasing orders for its commercial aircrafts and its investments in new Maintenance, Repair and Overhaul facilities.

National Vision (EYE) Rides on America's Best Brand's Growth
The Zacks analyst is impressed with National Vision's America's Best, which is particularly driving revenues banking on the ongoing strength in Managed Care.

New Downgrades

Weak Consumer Demand Hurts TreeHouse Foods (THS) Sales
Per the Zacks analyst, TreeHouse Foods is struggling with slower consumer demand in key categories. In the fourth quarter of 2024, the company's sales fell 0.6% year over year.

High Operating Expenses and Uncertain Demand Hurt Molina Healthcare
Per the Zacks analyst, Molina Healthcare's rise in expense level continues to put pressure on its margins. The withdrawal of government support can lead to uncertain demand.

Weak Multi-Family Housing Ails Builders FirstSource (BLDR)
Per the Zacks analyst, Builders FirstSource business is being hurt by a weakening multi-family housing market and reduced operating leverage. Also, high costs and expenses are added concerns.

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GSK PLC Sponsored ADR (GSK) : Free Stock Analysis Report

Microsoft Corporation (MSFT) : Free Stock Analysis Report

NVIDIA Corporation (NVDA) : Free Stock Analysis Report

Diamondback Energy, Inc. (FANG) : Free Stock Analysis Report

Alphabet Inc. (GOOGL) : Free Stock Analysis Report

Cooper-Standard Holdings Inc. (CPS) : Free Stock Analysis Report

Sony Corporation (SONY) : Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research