Monday, April 7, 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 Verizon Communications Inc. (VZ), The Southern Company (SO) and Blackstone Inc. (BX), as well as two micro-cap stocks Utah Medical Products, Inc. (UTMD) and The Eastern Company (EML). 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 >>> Tariff Saga Starts 2nd Week, Pre-Markets Down Big Again

Today's Featured Research Reports

Shares of Verizon have gained +10.1% over the past year against the Zacks Wireless National industry’s gain of +39.8%. The company with one of the most efficient wireless networks in the United States continues to deploy the latest technologies to deliver faster peak data speeds and capacity for customers. Its 5G mobility service offers a premium experience across various industries such as public safety, health care, retail and more.  

Verizon is offering various mix-and-match pricing in both wireless and home broadband plans, which has led to solid customer additions. The company’s focus on online content delivery, mobile video and online advertising should drive growth. 

However, fierce competition from other major players and saturation in the wireless market is hurting its profits. High capital expenditures in order to support the launch and continued build-out of its 5G Ultra-Wideband network are straining the margin. Macroeconomic challenges remain a concern.

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

The Southern’s shares have outperformed the Zacks Utility - Electric Power industry over the past year (+31.3% vs. +17.5%). The company, being one of the largest electric utility firms in the U.S., offers a stable, recession-proof business model with predictable earnings, backed by its regulated utility structure and significant capital investments in clean energy, including the Vogtle nuclear units. 

The Southern is well-positioned to benefit from growing demand, especially from data centers and has planned $63 billion in capital investments to drive future growth. Southern also boasts a long history of reliable dividend payouts. 

However, the expansion into nuclear energy presents regulatory risks, and climate-related events pose operational challenges. The company’s high leverage and caution around future nuclear investments limit its financial flexibility. Therefore, Southern Company warrants a cautious stance from investors.

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

Shares of Blackstone have declined -0.7% over the past year against the Zacks Financial - Miscellaneous Services industry’s decline of -10.9%. The company has a decent earnings surprise history. Blackstone’s earnings outpaced the Zacks Consensus Estimate in two of the trailing four quarters. 

A strong revenue mix, global footprint, diversified products, superior position in the alternative investments space and solid total and fee-earning asset under management (AUM) balances are expected to support its financials. Also, robust fundraising ability and significant available capital for deployment will support top-line expansion. The company has a solid balance sheet position, enabling it to address its debt obligations.

Nevertheless, elevated consolidated expenses will likely hamper Blackstone’s bottom-line expansion. The low sustainability of its capital distribution activities, given volatile earnings, is worrisome.

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

Utah Medical Products’ shares have underperformed the Zacks Medical - Products industry over the past year (-20.2% vs. +2.5%). This microcap company with market capitalization of $179.94 million is witnessing profitability under pressure from elevated R&D and SG&A expenses, resulting in a 290 bps year-over-year operating margin decline. Regulatory hurdles pose go-to-market risks. Working capital inefficiencies and high CapEx with limited near-term revenue conversion further weigh on free cash flow and asset utilization.

Nevertheless, UTMD benefits from a strong recurring revenue base, zero long-term debt and consistent dividend growth. Its portfolio of high-margin obstetric and gynecological devices enjoys global clinical trust, enabling resilient pricing and cash flow. 

Strategic exposure to the growing women’s and neonatal health market provides insulation from broader healthcare cyclicality. UTMD's global reach (100+ countries) diversifies revenues and reduces regional risk. Operationally, its in-house manufacturing drives margin stability and supply chain control.

(You can read the full research report on Utah Medical Products here >>>)

Shares of The Eastern have underperformed the Zacks Security and Safety Services industry over the past year (-27.2% vs. -9.7%). This microcap company with market capitalization of $145.2 million is having SG&A rose 7.9% due to restructuring costs, and Big 3’s packaging backlog declined, signaling potential demand softness. Eastern remains highly exposed to Class 8 OEM cycles, and a reduction in product development spending raises concerns about future innovation capacity.

Nevertheless, Eastern Company is advancing its market leadership in Class 8 truck components through Velvac’s new mirror platform, which has driven significant backlog growth and captured OEM share. Its robust aftermarket business offers resilience beyond production cycles. 

FY2024 net income rose 12% to $13.2 million, with adjusted income at $14.2 million and leverage down to 1.23X. Strong cash generation supported $2.7 million in dividends and share repurchases. A diversified manufacturing base across the United States, Mexico, and China enhances supply chain flexibility and customer responsiveness.

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

Other noteworthy reports we are featuring today include Amphenol Corporation (APH), American Water Works Company, Inc. (AWK) and Universal Health Services, Inc. (UHS).

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

Verizon (VZ) Rides on Solid 5G Traction, Network Investment

Southern (SO) Set to Benefit from Rising Data Center Demand

Fund-Raising Ability Aids Blackstone (BX), High Costs Ails

Featured Reports

Weakness in Key Markets Hurts Amphenol (APH) Prospect
Per the Zacks analyst, weakness in key markets like mobile devices and automotive is expected to hurt Amphenol's near-term performance.

Investment & Expanding Operation Aid American Water (AWK)
Per the Zacks analyst American Water's planned long-term investment to strengthen infrastructure and expanding operation through acquisition and organic means are going to drive its performance.

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.

Axsome's (AXSM) Marketed Drugs Drive Growth Amid Competition
Per the Zacks analyst, Axsome's lead drug, Auvelity, approved for treating major depressive disorder is driving sales. The addition of Sunosi bodes well too. However, stiff competition remains a woe.

Accretive Business Growth Strategies Aid RH Amid High Costs
Per the Zacks analyst, RH is benefiting from its focus on product transformation, global expansion and platform expansion. However, lingering inflation and tariff uncertainties hurt prospects.

RingCentral (RNG) Rides on Strong Portfolio, Partner Base
Per the Zacks analyst, RingCentral benefits from solid demand for its Unified Communications as a Service and contact center software-as-a-service solutions.

Acima Emerges as a Key Growth Driver for Upbound (UPBD)
Per the Zacks analyst, Acima, Upbound's virtual LTO business, continued its strong momentum in Q4 with 15.3% GMV growth, supported by retail expansion, improved productivity, and rising DTC demand.

New Upgrades

Acquisitions & Solid Acute Care Aid Universal Health (UHS)
Per the Zacks analyst, numerous acquisitions help Universal Health expand geographically and boost current segments. New hospitals are expected to accelerate growth in the Acute Care Segment.

BlackBerry (BB) Banks on QNX Strength, Cost-Saving Efforts
Per the Zacks analyst, increasing design wins in the core digital cockpit and ADAS of QNX business is boosting BlackBerry's performance. Cost-cutting and restructuring measures augur well.

Strong Demand in Infrastructure Segment to Aid Lindsay (LNN)
Per the Zacks analyst, Lindsay will gain from the momentum in infrastructure segment backed by demand for Road Zipper projects, focus on acquisition and the solid balance sheet.

New Downgrades

Weaker Residential Roofing Demand Hurt Beacon (BECN)
Per the Zacks analyst, Beacon's business is being hurt by weaker residential roofing demand due to challenging macro-economic condition. Also, rising costs & weather woes are added concerns.

Rising Costs Will Trim Acadia Healthcare's (ACHC) Margins
Per the Zacks analyst, higher salaries, wages and benefits will keep pushing Acadia Healthcare's costs above, lowering its profit growth. Also, volumes will likely take a hit from media scrutiny.

Healthcare Industry Regulations Ail AMN Healthcare (AMN)
The Zacks analyst is worried about AMN Healthcare being subject to extensive and complex federal and state laws and regulations. A tough competitive space is an added concern.

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

Southern Company (The) (SO) : Free Stock Analysis Report

Blackstone Inc. (BX) : Free Stock Analysis Report

Verizon Communications Inc. (VZ) : Free Stock Analysis Report

Amphenol Corporation (APH) : Free Stock Analysis Report

Universal Health Services, Inc. (UHS) : Free Stock Analysis Report

American Water Works Company, Inc. (AWK) : Free Stock Analysis Report

Utah Medical Products, Inc. (UTMD): Free Stock Analysis Report

Eastern Company (The) (EML): Free Stock Analysis Report

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

Zacks Investment Research