Wednesday, March 5, 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 NVIDIA Corp. (NVDA), Tesla, Inc. (TSLA) and American Express Co. (AXP), as well as two micro-cap stocks CSP Inc. (CSPI) and NetSol Technologies, Inc. (NTWK). 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's open 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 >>> ADP +77K, Far Lower than Expected; Tariff News Forthcoming?

Today's Featured Research Reports

NVIDIA’s shares have outperformed the Zacks Semiconductor - General industry over the past year (+61.6% vs. +25.8%). 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. 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. The U.S.-China tech war and rising competition from AMD remain major concerns.

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

Shares of Tesla have outperformed the Zacks Automotive - Domestic industry over the past year (+96.9% vs. +7%). The company’s electric vehicle (EV) business is under pressure from pricing challenges and fierce competition, with 2024 marking its first-ever annual delivery decline. CEO Musk’s divided attention and growing political controversies have investors questioning whether Tesla is still his top priority. 

Further, Tesla expects operating expenses to rise this year, squeezing profitability. Having said that, Tesla's long-term growth prospects still remain strong, driven by its thriving Energy Generation & Storage segment, expansive Supercharger network and AI advancements. 

Tesla’s robust balance sheet, with a high liquidity buffer, supports continued innovation and expansion. Progress in the autonomous vehicle domain, including plans to launch robotaxi services in 2025 bode well. Thus, investors should retain Tesla stock for now. 

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

American Express’ shares have outperformed the Zacks Financial - Miscellaneous Services industry over the past year (+44.7% vs. +6.7%). The company’s growth initiatives, like launching new products, reaching new agreements and forging alliances, are boosting its revenues. Consumer spending on travel and entertainment, which carries higher margins for AmEx, is advancing well. 

American Express’ focus on Millennials and Gen-Z consumers, who exhibit strong dining preferences, will position the company for long-term growth. Its solid cash-generation abilities enable the pursuit of business investments. 

However, with higher utilization of its cards, costs in the form of card member services and card member rewards are likely to go up. Its current debt level induces an increase in interest expenses. rovision for credit losses has been increasing due to higher net write-offs. As such, the stock warrants a cautious stance.

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

Shares of CSP have underperformed the Zacks Computer - Integrated Systems industry over the past year (-18.9% vs. -17.6%). This microcap company with market capitalization of $150.68 million is facing risks which include weak growth in the high-performance products segment, dependence on low-margin IT solutions and continued operating losses despite revenue growth.

High stock-based compensation, customer concentration risks and limited international reach add uncertainty. Investors must weigh CSP’s cybersecurity potential against its ongoing profitability challenges.

Nevertheless, CSP is transitioning toward high-margin, recurring revenue streams, driven by strong service revenue growth and increased demand for its cybersecurity solutions. 

The company’s AZT PROTECT platform is gaining traction in critical infrastructure sectors, supported by key partnerships and a growing patent portfolio. A strong balance sheet with no long-term debt enables strategic investments, while its alliance with Rockwell Automation accelerates market expansion.

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

NetSol Technologies’ shares have underperformed the Zacks Computer - Software industry over the past year (-8.7% vs. +1.3%). This microcap company with market capitalization of $28.71 million have seen license fee revenues plummeted 97.6% year over year, and rising operating expenses ($7.41 million, +20.5%) pressured profitability. 

Net loss reached $1.15 million due to FX volatility, and revenue from key client Daimler fell 23%. Trade risks, competitive pressures, and uncertain ROI on growth investments remain concerns. As such, the stock warrants a cautious stance.

Nevertheless, NetSol is transitioning to a subscription-based model, enhancing revenue stability. In the second quarter of fiscal 2025, subscription and support revenues grew 27% year over year to $8.6 million (55.6% of total revenues). 

Strong customer relationships with BMW and Kubota drive long-term revenue visibility, while North American expansion diversifies income streams. AI-driven product enhancements improve efficiency, and a solid cash position ($21.3 million) supports growth.

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

Other noteworthy reports we are featuring today include Constellation Energy Corp. (CEG), Cencora, Inc. (COR) and M&T Bank Corp. (MTB).

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

NVIDIA (NVDA) Benefits from Growing Adoption of GPUs

Tesla (TSLA) to Ride on AV Focus & Energy Storage Business

Robust Revenues, Cash Position Aid American Express (AXP)

Featured Reports

Organic Growth Aids Cencora (COR) Amid Competition
Per the Zacks analyst, Cencora should benefit from continued solid organic revenue growth, World Courier unit and Specialty distribution business amid cutthroat competition in the Medtech space.

Loan Growth Supports M&T Bank (MTB), Rising Costs a Woe
Per the Zacks analyst, M&T Bank's top line gets support from increasing loans and deposits balances. However, investments in strengthening its franchise keep the bottom-line under pressure.

Technological Prowess Aids Rollins (ROL, Rising Costs Ail
Per the Zacks analyst, Rollins' real-time service tracking and customer Internet communication technologies have increased its competitive advantage. Rising expenses remain a concern.

Subsea Unit with iEPCI model Aids TechnipFMC (FTI)
The Zacks analyst believes that TechnipFMC's unique Subsea 2.0 products will lead to strong growth but declining performance in the Surface Technologies segment raises concern.

Higher Commitments Aid Ares Capital (ARCC), High Costs Ail
Per the Zacks analyst, rising investment commitments, demand for customized financing and a solid balance sheet will aid Ares Capital's financials. Yet, regulatory risks and high costs are woes.

Solid Backlog, Buyouts to Aid MasTec (MTZ), Delays Hurt
Per the Zacks analyst, MasTec to gain from record 18-month backlog of $14.3 billion, along with recent strategic acquisitions. Yet, fluctuations in capital spending and weather-related delays hurt.

Solid Top Line Aids Mercury General (MCY), Cat Loss Ails
Per the Zacks analyst, improved net investment income, rate increases and rise in number of policies written should drive the revenues of Mercury General. However, exposure to cat loss is a concern.

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

Solid Licensing Momentum, New Launches Aid InterDigital (IDCC)
Per the Zacks Analyst, solid licensing momentum and product innovation are boosting InterDigital's top line. Strategic buyouts further aid the company.

Rising Air Traffic, Strong Financials Aid AAR Corp. (AIR)
Per the Zacks analyst, steadily growing air passenger traffic is boosting AAR Corp.'s Parts Supply business. The stock also holds a solid solvency position, which might impress its investors.

New Downgrades

TEVA's 2025 Earnings View Weak; To be Hurt by High Costs
Teva's earnings outlook for 2025 failed to impress the Zacks analyst. With costs expected to rise as the company invests heavily in its pipeline, margins are not expected to expand in 2025.

Rising Cost Irk Henry Schein (HSIC) Amid Tough Competition
The Zacks analyst is worried about Henry Schein's rising costs that are putting pressure on the company's top line. Also, tough competitive U.S. healthcare products and service market is a worry.

Kohl's (KSS) Remains Troubled by Tough Consumer Environment
Per the Zacks analyst, Kohl's faces pressure from a challenging consumer environment. In Q3, results fell short of expectations, with sales remaining weak in the apparel and footwear sectors.

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

Constellation Energy Corporation (CEG) : Free Stock Analysis Report

American Express Company (AXP) : Free Stock Analysis Report

M&T Bank Corporation (MTB) : Free Stock Analysis Report

NVIDIA Corporation (NVDA) : Free Stock Analysis Report

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

Cencora, Inc. (COR) : Free Stock Analysis Report

NetSol Technologies Inc. (NTWK) : Free Stock Analysis Report

CSP Inc. (CSPI): Free Stock Analysis Report

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

Zacks Investment Research