Dropbox and CDW have been highlighted as Zacks Bull and Bear of the Day

For Immediate ReleaseChicago, IL – November 21, 2024 – Zacks Equity Research shares Dropbox DBX as the Bull of the Day and CDW Corporation CDW as the Bear of the Day. In addition, Zacks Equity Research provides analysis on United Airlines UAL, Westinghouse Air Brake Technologies WAB and SkyWest SKYW.Here is a synopsis of all five stocks.Bull of the Day:Increased profitability, strong cash flow, and innovation into artificial intelligence is starting to make Dropbox stock appealing among the Zacks Internet-Services Industry, which is in the top 14% out of 250 Zacks industries.With its cloud-based collaboration platform expanding, Dropbox shares may appeal to growth and value investors. Considering such, Dropbox stock sports a Zacks Rank #1 (Strong Buy) and lands the Bull of the Day after exceeding its Q3 expectations earlier in the month.Increased Profitability OverviewOperating as a file hosting service, Dropbox synchronizes personal cloud and enterprise software to create, access, and share digital content.Dropbox’s paying users stood at 18.24 million at the end of Q3 2024, up from 18.17 million in the comparative quarter. Enhancing its operating efficiency, Q3 EPS was slightly up to $0.60 and impressively topped the Zacks EPS Consensus of $0.52 a share.Third quarter sales of $638.8 million increased 1% from a year ago and edged estimates of $636.93 million. Most intriguing and indicative of more upside in Dropbox stock is that earnings estimate revisions for fiscal 2024 and FY25 are up 7% and 9% in the last 30 days respectively. Furthermore, Dropbox's annual earnings are now expected to increase over 20% this year and are projected to rise another 9% in FY25 to $2.62 per share.Stronger Cash FlowPiggybacking on Dropbox's operational efficiency, free cash flow increased 9% year over year to a quarterly record of $270.1 million.Dropbox Dash (AI Prospects)Making good use of its free cash flow, Dropbox has planned to expand and innovate its platform. During its Q3 report, Co-founder and CEO Drew Houston stated Dropbox plans to leverage its customer base, trusted brand, and scale infrastructure to deliver on the company’s next phase of growth.Expansion into AI may interest investors in particular, with Dropbox Dash being an AI-powered universal search tool designed to help users find, organize, and share content across various apps and platforms.Dropbox’s Attractive P/E ValuationWith Dropbox focusing on the next phase of growth, its valuation should attract value investors. To that point, DBX trades under $30 and at a very reasonable 11.7X forward earnings multiple.This is a sharp discount to the S&P 500’s 25.1X and the Zacks Internet-Services average of 23.5X with some of the notable names in the space being Shopify and Uber.Bottom LinePositive earnings estimate revisions are starting to magnify Dropbox’s attractive P/E valuation and EPS growth. With now appearing to be an ideal time to buy Dropbox’s stock, the company’s innovation is starting to make DBX look like a viable long-term investment as well.Bear of the Day:Despite being a leader in integrated information technology (IT) solutions, CDW Corporation reported subpar Q3 results at the end of October, leading to a drop in earnings estimate revisions.Down nearly -20% year to date, CDW's stock lands a Zacks Rank #5 (Strong Sell) and the Bear of the Day as more downside risk may be ahead.CDW’s Subpar Q3 ResultsWeighing on investor sentiment, CDW shares have plummeted sharply over the last month after Q3 earnings of $2.63 per share missed the Zacks EPS Consensus of $2.84 by -7%. Year over year, CDW’s bottom line contracted from $2.72 a share in Q3 2023. Furthermore, CDW has missed earnings expectations in three of its last four quarterly reports with an average EPS surprise of -4.73% during this period.This came as CDW’s Q3 sales dipped to $5.51 billion compared to $5.62 billion in the comparative quarter and missed estimates of $5.71 billion by -3%. CDW has also missed top line estimates in three of the last four quarters with an average sales surprise of -2.67%.Slower Demand & Increased CompetitionNotably, CDW attributed its subpar Q3 results to economic uncertainty and growing complexity in the technology landscape, resulting in slower customer decision-making and project delays.CDW also alluded to increased competition and pricing intensity across all of its end markets with a few of its notable competitors being Accenture, Dell Technologies and IBM.Declining EPS EstimatesSuggesting the decline in CDW’s stock could continue is that fiscal 2024 earnings estimates have fallen 5% in the last 30 days to $9.46 per share compared to EPS estimates of $9.97 a month ago. More concerning and taking away from CDW’s growth narrative is that FY25 EPS estimates have dipped more than 2% in the last month.Bottom LineOperating in a competitive landscape, it may be best to avoid CDW’s stock for now. To that point, CDW may be losing mojo but there are more appealing options in its broader Zacks Computers-IT Services Industry which is in the top 19% out of 250 Zacks industries.Additional content:United Airlines Expects 2024 Holiday Season to Be Busiest EverUnited Airlines, which had a busy summer this year, carrying a record 48 million passengers, expects travel to surge this winter, led by increased travel to Europe. UAL stated that bookings to European destinations have been exceptionally strong and are up nearly 30% from that recorded in 2019 and up nearly 10% year over year.This indicates that Americans are more inclined to spend their money during holidays on experiences rather than on physical gifts. Per a recent Deloitte survey, consumer spending on holiday experiences is expected to rise 16% in 2024, while spending on physical gifts remains flat.To meet the expected demand swell during the holiday season, UAL aims to offer nearly 60 nonstop flights each day from its hubs in the United States to Europe in November and December. This offering by UAL is more than any other U.S. airline. Furthermore, through UAL’s partners, connecting travelers can visit even more Christmas markets. UAL’s popular European destinations during the holiday period include London, Frankfurt, Munich, Paris and Brussels.Driven by upbeat passenger volumes, UAL expects to carry 25 million passengers during the holiday period, up 6% from the year-ago level. In the event of this expectation materializing, 2024 would represent the busiest holiday period yet for UAL.Driven by the buoyant air-travel demand scenario, shares of the Zacks Rank #2 (Buy) company have outperformed its industry and the S&P 500 index on a year-to-date basis.A busy winter holiday season, as expected by the airline, may boost its stock price further.Other Stocks to ConsiderInvestors interested in the Zacks Transportation sector may consider other top-ranked companies like Westinghouse Air Brake Technologies and SkyWest.Westinghouse Air Brake Technologies currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here. WAB has an expected earnings growth rate of 2.01% for the current year. The company has an impressive earnings surprise history. Its earnings outpaced the Zacks Consensus Estimate in three of the trailing four quarters and missed once, delivering an average beat of 9.46%. Shares of WAB have risen 69% in the past year.SkyWest presently flaunts a Zacks Rank #1 and has an expected earnings growth rate of 4.07% for the current year.The company has an encouraging track record with respect to the earnings surprise, having surpassed the Zacks Consensus Estimate in each of the trailing four quarters. The average beat is 79.12%. Shares of SKYW have climbed 136.3% in the past year.Why Haven't You Looked at Zacks' Top Stocks?Since 2000, our top stock-picking strategies have blown away the S&P's +7.0 average gain per year. Amazingly, they soared with average gains of +44.9%, +48.4% and +55.2% per year.Today you can access their live picks without cost or obligation.See Stocks Free >>Media ContactZacks Investment Research800-767-3771 ext. 9339https://www.zacks.comZacks.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.Research Chief Names "Single Best Pick to Double"From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant 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 United Airlines Holdings Inc (UAL): Free Stock Analysis Report SkyWest, Inc. (SKYW): Free Stock Analysis Report Westinghouse Air Brake Technologies Corporation (WAB): Free Stock Analysis Report CDW Corporation (CDW): Free Stock Analysis Report Dropbox, Inc. (DBX): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks