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Bank of America, one of the largest financial institutions in the United States, has released a report to name several companies that its analysts say trade in this difficult economic environment and therefore have more profit margin, growth in the stock market.
This theme echoed the most recent Bank of America report, in which the firm named several stocks that were poised to gain market share. Similar companies include TJX Companies, Zeta Global, Costco, and Union Pacific.
In the case of TJX Companies, the discount company has room to grow, especially as shoppers look to save money by exchanging items for more affordable cards, according to analyst Lorraine Hutchinson.
The company’s shares have risen 18% in the past year. “Our rating reflects our view that TJX will continue to drive sales growth in the domestic market as it wins new customers with strong inventory management and performance,” Hutchinson said.
The analyst highlighted TJX’s direction, noting its record of success in satisfying consumers and shareholders. “We see potential in improving sales and margins if business momentum continues,” he said.
Although TJX just came out with a mixed report for the quarter, the analyst advised the advisers to remain calm and look beyond the results. Hutchinson still sees long-term growth.
“We maintain our Buy rating as we believe TJX is a market share winner well-positioned for product migration to better affordable products and high inventory availability,” he said.
In the case of Costco, the retail company is operating at full capacity, according to a report issued by the company in its second quarter of fiscal results. “Traffic is driving growth in the second quarter and through February,” said analyst Robert Ohmes.
The company is experiencing “strength in consumables trends and adherence to comparable sales,” he added.
In fact, Jim Cramer’s “Investment Peak” is considered the “best run seller” in the United States. Shares are up more than 4% this year, but Ohmes said the stock’s valuation remains fair. In addition, Costco is also on the list of the most valuable and best read companies.
Bank of America also touted Costco’s robust model, along with “stable margins and growing EBITDA.” Ohmes said this gives the retailer a competitive advantage over its competitors.
For these reasons, investors should buy the stock, he said: “We reiterate our revised recommendation and continue to see Costco well positioned for the long term as market-driven gains due to its strong value proposition and price position.
Of Zeta Global, analyst Koji Ikeda recently highlighted the software solutions business of the latest quarter of the report, noting that the results demonstrate the strength of the company.
“In an environment where many marketing technology companies and sellers are seeing control over customer spending, Zeta’s third-party performance platform provides a strong value proposition,” Ikeda said.
The analyst cited the potential for revenue growth due to additional health care clients. “We believe that the fourth quarter results support our view of the business being distinguished, which will continue to provide good execution and potentially stimulate valuations,” Ikeda added.
To conclude, it is important to note that increasing traffic on the platform over time leads to higher profits and higher revenues. Zeta Global’s shares are up nearly 35% this year.
“We believe Zeta Global is a potential market share winner from digital advertising and marketing strategies,” Ikeda said.
Finally, Analysts Analysts Analysts “Best in class in gaining market share and a leader in free cash flow. Reiterating our Buy recommendations, we raise our price target to $230 (was $215) after another strong performance highlighting an unbeaten auto demand and industry diversification. … ADI we sell for its automotive growth prospects in the communications and industrial markets, with best-in-class free cash flow growth.We value ADI at the higher end of its peer group due to its growth potential and free cash flow generation.
Pacific Union, “Encourage to buy; CEO Fritz retires with active calls to Experience Opis. … On Sunday, the UNP released a statement announcing that President and CEO Lance Fritz will step down in 2023, just two hours after investor Soroban Capital called on the activist to step down. … We increased PO to $241 from $218 over 20x our 2024 EPS of $12.05, increasing confidence in our path to operational improvement, and the potential to accelerate earnings.
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