Thursday, January 23, 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 Tesla, Inc. (TSLA), UnitedHealth Group Incorporated (UNH) and Oracle Corporation (ORCL), as well as a micro-cap stock Earth Science Tech, Inc. (ETST).  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 >>>

Today's Featured Research Reports

Tesla shares have outperformed the Zacks Automotive - Domestic industry over the past year (+107.9% vs. +64.6%). The company’s annual deliveries contracted for the first time ever in 2024, its long-term growth story remains intact driven by its thriving Energy Generation & Storage segment, expansive Supercharger network and AI advancements.

Energy deployments doubled in 2024 and the upward trajectory is set to continue, thanks to the strong reception of its Megapack and Powerwall products. Progress in the autonomous vehicle domain, including plans to launch robotaxi services in 2025, position the company well for sustained growth.

Despite potential rebate cuts under a Trump presidency, Tesla is well-positioned to thrive without subsidies, thanks to its cost efficiency and unmatched scale. Tesla’s robust balance sheet, with a high liquidity buffer, supports continued innovation and expansion. As such, we are bullish on the stock.

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

Shares of UnitedHealth have outperformed the Zacks Medical - HMOs industry over the past year (+1.3% vs. -2.5%). The company’s fourth-quarter earnings beat estimates. Its top line remains poised for growth on the back of a strong market position, new deals, renewed agreements and expansion of service offerings. The company’s solid health services segment provides diversification benefits.

The Government business remains well-poised for growth in the future. Adjusted net earnings per share are anticipated to be in the $29.50-$30.00 band in 2025. A sturdy balance sheet enables investments and prudent deployment of capital via share repurchases and dividend payments.

However, membership in its global business continues to be a concern. High operating costs due to rising medical expenses are hurting margins. A debt-laden balance sheet induces an increase in interest expenses.

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

Oracle shares have outperformed the Zacks Computer - Software industry over the past year (+92% vs. +15.6%). The company reported mixed fiscal Q2 2025 results, wherein earnings and revenues missed estimates. Revenues were driven by continued momentum from its Oracle Cloud Infrastructure business, including from winning cloud-computing contracts from AI-focused startups.

ORCL’s continued investment in cloud infrastructure positions it well for sustained growth in the dynamic software industry. ORCL’s partnership with Amazon for Oracle Database@AWS and general availability of Oracle Database@Google bodes well. Oracle’s Gen 2 Cloud is driving artificial intelligence clientele. Its share buybacks and dividend policy are noteworthy.

The Zacks analyst expect fiscal 2025 net sales to grow 8.7% from fiscal 2024. However, higher spending on product enhancements, toward the cloud platform amid increasing competition in the cloud domain is likely to limit margin expansion

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

Shares of Earth Science Tech have outperformed the Zacks Medical - Biomedical and Genetics industry over the past year (+270.1% vs. -10.8%). This microcap company with market capitalization of $57.69 million reported $17.1 million in revenues for the six months ended Sept. 30, 2024, driven by pharmaceutical and telemedicine subsidiaries, reflecting scalable operations and diversified revenue streams. Cash flow improved to $1.9 million from $127,910 in the prior-year period, reflecting efficiency gains.

The telemedicine platform, Peaks, positions ETST for growth amid rising virtual healthcare adoption. Strategic relocation and asset acquisitions support scaling, while RxCompound and Peaks diversify offerings and reduce market dependency, aligning with health and wellness trends.

Risks include escalating expenses, low net margins, modest cash reserves, competitive pressures, acquisition integration concerns and regulatory compliance challenges. Sustained growth depends on managing costs and leveraging innovation in telehealth.

(You can read the full research report on Earth Science Tech here >>>)

Other noteworthy reports we are featuring today include Eaton Corporation plc (ETN), Vertex Pharmaceuticals Incorporated (VRTX) and Constellation Energy Corporation (CEG).

Director of Research

Sheraz Mian

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

Energy Storage Business & Low Leverage to Aid Tesla (TSLA)

Solid Top Line & Strong Cash Flows Drive UnitedHealth (UNH)

Oracle (ORCL) Gains from Cloud Suite Adoption & Partnerships

Featured Reports

Wide Market Reach, New Product Development Aid Eaton (ETN)
Per the Zacks analyst Eaton's operations in 175 countries across the world and development of new products through ongoing R&D investments will continue to drive demand and boost profitability.

Vertex (VRTX) Prepares for Upcoming Launches
While Vertex is preparing for two near-term launches ??? suzetrigine in acute pain and Alyftrek/vanza triple in cystic fibrosis in 2025, recent pipeline setbacks are a concern for the Zacks analyst.

AMETEK (AME) Rides on Acquisition Benefits & Organic Growth
Per the Zacks analyst, Virtek Vision International, Navitar and Alphasense buyouts are aiding AMETEK's Electronic Instruments unit. Strong organic growth continues to drive the top-line.

Veeva (VEEV) Gains on Strong R&D, Deals Amid Rising Costs
Per the Zacks Analyst, Veeva Systems continues to witness growth on the backs of its research and development capabilities and strategic deals. However, rising costs remains a cause for concern.

ANSYS' (ANSS) Performance Driven by Robust Product Portfolio
Per the Zacks Analyst, higher demand for simulation solutions across verticals like aerospace and high tech is driving ANSYS's performance. Increasing expenses and stiff competition are concerning.

Ulta Beauty (ULTA) Benefits From Skincare Category Strength
Per the Zacks analyst, Ulta Beauty has been benefiting from solid skincare sales. In third-quarter fiscal 2024, skincare saw mid-single-digit comp growth, fueled by innovation in body care products.

WEX Gains From Payzer Buyout, High Debt Servicing Costs Ail
Per the Zacks Analyst, the Payzer buyout aids WEX's growth, offering scalable SaaS to 150,000 small business clients. Servicing a high debt adds to operational costs, reducing cash flow flexibility.

New Upgrades

Focus on Renewable Energy Aid Constellation Energy (CEG)
Per the Zacks analyst, Constellation Energy gains from expansion of renewable portfolio. Its position as an industry leader in the safe operation of nuclear plants helps it increase its nuclear output

Product Launch, Higher Trading Aid Interactive Broker (IBKR)
Per the Zacks analyst, the development of proprietary software, new product and service launches, low level of compensation expense and solid trading backdrop will support Interactive Brokers.

V.F. Corporation (VFC) Benefits From Its Strategic Initiatives
Per the Zacks analyst, V.F. Corporation is poised for growth driven by progress on its Reinvent transformation program, which generated cost savings of $65 million in the second-quarter fiscal 2025.

New Downgrades

Lower ADTech Margins Hurt Oceaneering International (OII)
The Zacks analyst believes that delays in project schedules and awards are expected to lower Oceaneering International's ADTech segment margins to the low teens in Q4.

Supply Issues & High Input Costs to Hurt Manitowoc (MTW)
The Zacks Analyst is concerned that the ongoing supply chain challenges, inflationary costs and skilled labor shortages as well as higher steel cost will hurt Manitowoc's results.

High Mortgage Rates & Low Selling Price Hurt Lennar (LEN)
Per the Zacks analyst, Lennar's prospects are hurting from a still high mortgage rate scenario and low average selling price, reflecting a lag in the home sales pace.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

UnitedHealth Group Incorporated (UNH) : Free Stock Analysis Report

Constellation Energy Corporation (CEG) : Free Stock Analysis Report

Eaton Corporation, PLC (ETN) : Free Stock Analysis Report

Vertex Pharmaceuticals Incorporated (VRTX) : Free Stock Analysis Report

Oracle Corporation (ORCL) : Free Stock Analysis Report

Tesla, Inc. (TSLA) : Free Stock Analysis Report

Earth Science Tech, Inc. (ETST) : Free Stock Analysis Report

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