|
|
|
|
|||||
|
|
|
Chicago, IL – May 2, 2025 – Zacks Equity Research shares Broadcom AVGO as the Bull of the Day and JinkoSolar JKS as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Ford F, Tesla TSLA and General Motors GM.
Here is a synopsis of all five stocks.
Zacks Rank #1 (Strong Buy) stock Broadcom manufactures and sells semiconductors that are used in a range of technology products, such as smartphones, AI data centers, and the automotive industry, to name a few. Semiconductor solutions accounted for roughly 60% of 2024 revenues.
While the names of companies may come and go, and each moment in history on Wall Street is unique, every bull cycle has an underlying theme. That is, one growth industry that drives so much growth that it can lead the market up and down. For instance, in the late 19th and early 20th century, the key industry was railroads. The innovation was so novel and game-changing that it produced the most growth, profits, and speculation. The late 1990s saw the internet craze lead the US stock market higher and ultimately lower.
Today, that industry is artificial intelligence. Grand View Research predicts that the global AI market will balloon to more than $1.8 trillion over the next five years, racking up a compound annual growth rate of ~35%. CapEx, or Capital Expenditure spending mostly from America’s cash-rich big tech companies, is the key to determining AI growth and, thus, Broadcom’s potential earnings growth. As earnings season hits its stride, Broadcom and other big tech companies are receiving welcome news on the CAPEX front.
Restrictions on sending semiconductors overseas are an equally big threat to the semiconductor business. Yesterday, the Trump White House eased some of those concerns when it said it is considering easing restrictions after Nvidiaand other semiconductor juggernauts pushed for rule changes.
Broadcom benefits from robust demand for its networking products and custom AI accelerators (XPUs). Last year, AI revenues bolted 220% year-over-year. Meanwhile, Zacks Consensus Estimates suggest that AVGO will grow 42.73% this quarter, and 35.52% for full-year 2025.
During last quarter’s earnings conference call, AVGO management announced a massive $10 billion buyback. Share buybacks are bullish because they reduce the supply of stock available in the market, often leading to higher share prices.
AVGO has not missed Wall Street estimates in at least 5 years.
Fueled by explosive AI growth, strong CapEx spending from tech giants, and a gigantic share buyback program, Broadcom is well-positioned to capitalize on the AI revolution.
Zacks Rank #5 stock JinkoSolar is a Chinese manufacturer of photovoltaic (PV) solar modules and energy systems. JinkoSolar builds a vertically integrated solar product through its supply chain, which is recovered from silicon materials or solar modules. The company’s primary products are silicon wafers, solar cells, and solar modules, which are all PV. JKS has residential, commercial, and utility scale projects globally and is focused on sustainability and clean energy innovation.
With the intensifying trade war between the United States and China, uncertainty abounds on Wall Street. The Trump administration’s attempt to negotiate bilateral trade deals globally has sparked heated rhetoric, tit-for-tat threats and tariffs, and uncertainty on Wall Street. Though it appears that the Trump team has made progress with some countries, China and the United States remain miles apart.
For instance, over the past few days, the Trump team has claimed that talks are being held between the two adversaries, while the Chinese government has denied such claims. Meanwhile, Trump officials such as Treasury Scott Bessent say that a deal with China could take as long as two or three years.
For years, President Trump has alleged that China is “dumping cheap product” on the United States and other countries. It’s not just right-leaning politicians saying this, either. In 2024, then-Treasury Secretary Jant Yellen warned that China is treating the global economy as a dumping ground for cheap, clean energy products. In other words, the Chinese government subsidizes clean energy companies so that their prices are artificially low, putting local companies out of business.
When those companies exit the market, the Chinese companies hike prices. In response to this threat, Trump has set solar tariffs as high as 3,521% in Asia! While this is likely a positive for US solar companies like First Solarand Tesla, it essentially means that the US market is non-existent to companies like JinkoSolar.
Wall Street analysts are incredibly bearish on Jinko’s future and expect EPS to crater 453.85% this year!
JKS shares exhibit relative price weakness and are down 28.2% year-to-date, dramatically underperforming the S&P 500 Index. Meanwhile, shares are stuck below the key moving averages and are carving out a bear flag structure.
JinkoSolar, a major Chinese manufacturer of solar PV products, faces several bearish headwinds due to trade tensions between the US and China.
Ford is slated to release first-quarter 2025 results on May 5, after market close. The Zacks Consensus Estimate for the to-be-reported quarter’s EPS and automotive revenues is pegged at breakeven and $35.5 billion, respectively.
The earnings estimate for the to-be-reported quarter has moved up by 2 cents over the past seven days. In the year-ago period, the company reported EPS of 49 cents. The Zacks Consensus Estimate for quarterly revenues suggests an 11% decline from the year-ago quarter’s figure.
For 2025, the Zacks Consensus Estimate for F’s automotive revenues is pegged at $162.3 billion, suggesting a decline of 6% year over year. The consensus mark for full-year EPS is $1.22, calling for a 33.7% year-over-year contraction.
In the trailing four quarters, this U.S. legacy automaker surpassed EPS estimates on two occasions, missed once and matched on the other, with the average earnings surprise being 1.21%.
Ford Motor Company price-eps-surprise | Ford Motor Company Quote
Our proven model does not conclusively predict an earnings beat for Ford this time around. The combination of a positiveEarnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Ford has an Earnings ESP of 0.00% and a Zacks Rank #3.
You can see the complete list of today’s Zacks #1 Rank stocks here.
(Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)
While most automakers reported a year-over-year increase in their first-quarter sales volumes, it was not the case with Ford. The company’s sales declined 1.3% in the to-be-reported quarter to 501,291 units. The drop was mainly due to the timing of rental fleet sales and the discontinuation of the Ford Edge and Transit Connect. However, retail sales grew 5% during the quarter. Sales of Ford’s electrified vehicles, including EVs and hybrids, jumped 25.5% to 73,623 units.
Tesla was another auto biggie that saw its deliveries drop in the quarter under discussion. It delivered 336,681 EVs, which fell 13% year over year. Meanwhile, Ford’s closest peer General Motors sold 693,363 units in the first quarter of 2025, up 17% year over year.
Ford had notified on its last earnings call itself that the company will sell fewer internal combustion engine vehicles compared to 2024. Additionally, a shift in product mix and foreign exchange headwinds will drag profits.
Ford had guided breakeven adjusted EBITDA in the first quarter of 2025, marking a sharp drop from $2.7 billion in the first quarter of 2024 and $2.1 billion in the fourth quarter of 2024 due to lower volumes, a 20% production cut and plant launch activities.
Here’s a rundown of the estimates for Ford’s revenues and EBIT for key segments for the three months ended March 31.
The Zacks Consensus Estimate for revenues from the Ford Blue unit (comprising ICE and hybrid models) is pegged at $17.6 billion, implying a decrease of 19% year over year. The consensus mark for the segment’s EBIT is $275 million, down from $905 million recorded in the first quarter of 2024.
The Zacks Consensus Estimate for revenues from the Ford model e unit (comprising of electric vehicles) is pegged at $1.5 billion, compared with $115 million in the corresponding period in 2024. The consensus mark for the segment’s loss before interest and taxes is $1.17 billion, narrower than $1.32 billion in the year-ago quarter.
The Zacks Consensus Estimate for revenues from the Ford Pro unit (encompassing commercial vehicles and services) is pegged at $16.2 billion, implying a decline of 10% year over year. The consensus mark for the segment’s EBIT is $1.5 billion, suggesting a decline from $3 billion recorded in the first quarter of 2024.
Year to date, shares of Ford have inched up 1.1%, outperforming the industry. It has also performed better than Tesla and General Motors, whose shares have plunged 30% and 15%, respectively, so far in 2025.
From a valuation perspective, Ford is trading relatively cheap. Going by its price/sales ratio, the company is trading at a forward sales multiple of 0.24, below the industry’s 2.37. The company has a Value Score of A. Meanwhile, Tesla looks too pricey at a forward sales multiple of 8.57, whereas General Motors’ P/S sits at 0.25.
Ford is indeed facing challenges. Widening EV losses, weakening ICE performance and auto tariffs threaten margins and earnings. Its 2025 outlook is soft and doesn’t even account for tariffs. Full-year adjusted EBIT is forecast at $7-$8.5 billion, down from $10.2 billion in 2024. Warranty costs and generous incentives will weigh on margins and overall profitability. However, not all is gloom and doom.
The combination of Ford Pro's strong order books, increasing demand signals and the successful launch of the all-new Super Duty sets the stage for a highly promising future for the Ford Pro segment. While the 2025 EBIT guidance for the segment implies a year-over-year decline, it is still expected to be the major profit driver for the company. Additionally, Ford’s high dividend yield of roughly 6% is quite appealing to income-focused investors. The company targets a payout ratio of 40-50% of free cash flow, reinforcing its commitment to shareholder returns. Ford’s strong liquidity position provides a cushion, with $28 billion in cash and around $47 billion in total liquidity at the end of 2024.
So, all in all, it is worth holding on to Ford stock now. However, investing ahead of its upcoming results doesn’t seem a good idea. It’s better to wait for management’s commentary on tariffs and updated 2025 guidance to see the potential impact.
Since 2000, our top stock-picking strategies have blown away the S&P's +7.7% average gain per year. Amazingly, they soared with average gains of +48.4%, +50.2% and +56.7% per year.
Today you can access their live picks without cost or obligation.
See Stocks Free >>
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
https://www.zacks.com
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index.Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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
This article originally published on Zacks Investment Research (zacks.com).
| 2 hours | |
| 3 hours | |
| 3 hours | |
| 3 hours |
Musk's next task? Reviving Tesla in Europe where sales have plunged by more than half in a year
TSLA
Associated Press Finance
|
| 4 hours | |
| 4 hours | |
| 4 hours | |
| 5 hours | |
| 5 hours | |
| 5 hours | |
| 6 hours | |
| 6 hours | |
| 6 hours | |
| 7 hours | |
| 7 hours |
Join thousands of traders who make more informed decisions with our premium features. Real-time quotes, advanced visualizations, backtesting, and much more.
Learn more about FINVIZ*Elite