Plexus and Olin have been highlighted as Zacks Bull and Bear of the Day

For Immediate ReleaseChicago, IL – November 19, 2024 – Zacks Equity Research shares Plexus Corporation PLXS as the Bull of the Day and Olin Corporation OLN as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Cheniere Energy LNG, Range Resources RRC and Shell plc SHEL.Here is a synopsis of all five stocks.Bull of the Day:Plexus Corporation, a Zacks Rank #1 (Strong Buy), is a global provider of electronic manufacturing services. The stock is displaying relative strength, breaking out to the upside this month amid a bullish move that pushed shares to new all-time highs.The price movement is a sign of strength as we head deeper into the historically-positive fourth quarter. Increasing volume has attracted investor attention as buying pressure accumulates in this top-ranked stock.Plexus is part of the Zacks Electronics – Manufacturing Services industry group, which currently ranks in the top 16% out of more than 250 industries. Because this group is ranked in the top half of all Zacks Ranked Industries, we expect it to outperform the market over the next 3 to 6 months, just as it has over the prior 3 months.Historical research studies suggest that approximately half of a stock’s price appreciation is due to its industry grouping. In fact, the top 50% of Zacks Ranked Industries outperforms the bottom 50% by a factor of more than 2 to 1. It’s no secret that investing in stocks that are part of leading industry groups can give us a leg up relative to the market. By focusing on leading stocks within the top industries, we can dramatically improve our stock-picking success.Company DescriptionPlexus offers design and development, supply chain, new product introduction, and manufacturing solutions. The company delivers its services to companies in a host of different sectors including healthcare and life sciences, industrial, aerospace and defense, and communications.In its fiscal fourth quarter, Plexus won 26 manufacturing contracts that are worth a combined $230 million in annualized revenues. The company’s expansion into several secular growth markets and massive backlog bode well for the foreseeable future. The funnel of qualified manufacturing opportunities is pegged at $3.5 billion, indicating a strong pipeline for growth.In addition to its continuation of new program ramps, Plexus has been streamlining its manufacturing facilities to optimize its operations. The company is expanding its presence in low-cost regions, establishing its presence in Penang, Malaysia and Guadalajara, Mexico.Earnings Trends and Future EstimatesA leading electronics manufacturer, Plexus has built up an impressive earnings history, surpassing earnings estimates in three of the past four quarters. The company has delivered a trailing four-quarter average earnings beat of 10.3%.Just last month, Plexus reported fiscal Q4 earnings of $1.85 per share, a 20.9% surprise over the $1.53/share consensus estimate. Revenues of $1.05 billion also exceeded projections by 4.3%.Analysts are bullish on the stock and have been raising earnings estimates across the board. The fiscal Q1 consensus EPS estimate has been revised upward in the past 60 days by 8.97% to $1.58/share. If the company is able to achieve this, it would translate to a 51.9% growth rate versus the same quarter last year.Let’s Get TechnicalThis market leader has seen its stock advance more than 40% in 2024 alone. Only stocks that are in extremely powerful uptrends are able to experience this type of outperformance. This is the kind of stock we want to include in our portfolio – one that is trending well and receiving positive earnings estimate revisions.The stock has been making a series of higher highs throughout the year. With both strong fundamental and technical indicators, PLXS stock is poised to continue its outperformance.Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. As we know, Plexus has recently witnessed positive revisions. As long as this trend remains intact (and PLXS continues to deliver earnings beats), the stock will likely continue its bullish run.Bottom LinePLXS stock sports the second-highest Zacks VGM Style Score, indicating a strong likelihood that shares continue to propel higher based on a powerful combination of earnings growth and favorable momentum metrics.Buoyed by a leading industry group, it’s not difficult to see why Plexus is a compelling investment. A healthy number of contract wins along improved operational efficiencies paint a pretty picture for this top-rated stock.Recent positive earnings estimate revisions should also serve to create a ‘floor’ in terms of any sudden or unexpected downside moves. If you haven’t already done so, be sure to put PLXS on your shortlist.Bear of the Day:Olin Corporation is a vertically-integrated producer and distributor of chemical solutions. The company operates in several regions including Latin America, Europe, Asia-Pacific, and North America. Olin produces and sells a wide variety of products such as chlorine, caustic soda, methyl chloride, hydrochloric acid, potassium hydroxide, and bleach products.The company is one of the largest marketers of caustic soda in Brazil. Additionally, Olin provides epoxy-related chemicals such as liquid and solid resins, allyl chloride, glycerin, and additives. A global producer, Olin also offers sporting ammunition products for hunters and recreational shooters, law enforcement agencies, and industrial applications.Soft global economic conditions are adversely affecting the company’s chemical business. Its Epoxy segment is facing weak demand in China and Europe. The company’s high level of debt is another concern, resulting in the reduction of its financial flexibility.The Zacks RundownA Zacks Rank #5 (Strong Sell) stock, Olin is a component of the Zacks Chemical - Diversified industry group, which currently ranks in the bottom 19% out of approximately 250 Zacks Ranked Industries. As such, we expect this industry group as a whole to underperform the market over the next 3 to 6 months, just as it has throughout the year.Stocks in the bottom tiers of industries can often be intriguing short candidates. While individual stocks have the ability to outperform even when they’re part of a lagging industry, the inclusion in a weaker group serves as a headwind for any potential rallies and the journey forward is that much more difficult.Along with many other diversified chemical stocks, OLN shares have been underperforming this year while the general market returned to new heights. The stock is hitting a series of lower lows and represents a compelling short opportunity as we head deeper into the fourth quarter.Recent Earnings Misses & Deteriorating OutlookOlin has fallen short of earnings estimates in two of the past three quarters. Just last month, the company reported a third-quarter loss of -$0.21/share, missing the $0.03/share Zacks Consensus Estimate by -800%.The chemical product distributor has posted a negative trailing four-quarter earnings surprise of -187.6%. Consistently falling short of earnings estimates is a recipe for underperformance, and OLN is no exception.The company has been on the receiving end of negative earnings estimate revisions as of late. Looking at the current quarter, analysts have slashed estimates by a whopping -76.6% in the past 60 days. The Q4 Zacks Consensus EPS Estimate is now $0.11/share, reflecting negative growth of -63.3% relative to the year-ago period.Falling earnings estimates are a huge red flag and need to be respected. Negative growth year-over-year is the type of trend that bears like to see.Technical OutlookOLN stock has experienced what is known as a “death cross,” whereby the stock’s 50-day moving average (blue line) crosses below its 200-day moving average. Shares would have to make an outsized move to the upside and show increasing earnings estimate revisions to warrant taking any long positions. The stock has fallen more than 20% this year alone.Final ThoughtsA deteriorating fundamental and technical backdrop show that this stock is not set to make its way to new highs anytime soon. The fact that OLN is included in one of the worst-performing industry groups provides yet another headwind to a long list of concerns. A history of earnings misses and falling future earnings estimates will likely serve as a ceiling to any potential rallies, nurturing the stock’s downtrend.Potential investors may want to give this stock the cold shoulder, or perhaps include it as part of a short or hedge strategy. Bulls will want to steer clear of OLN until the situation shows major signs of improvement.Additional content:Natural Gas Gains for the Week but Remains Well-SuppliedThe U.S. Energy Department's latest inventory report showed a lower-than-expected increase in natural gas supplies. Following this positive data, futures ended the week 6% higher.However, natural gas is expected to remain volatile, depending on the weather outlook, supply/demand balance etc. In such a situation, investors should focus on resilient stocks like Cheniere Energy, Range Resources and Shell plc.Natural Gas Build Smaller Than Market ExpectationsStockpiles held in underground storage in the lower 48 states rose 42 billion cubic feet (Bcf) for the week ended Nov. 8, below analysts’ guidance of a 44 Bcf addition. The increase compared with the five-year (2019-2023) average net injection of 29 Bcf and last year’s growth of 41 Bcf for the reported week.The weekly build put total natural gas stocks at 3,974 Bcf, 158 Bcf (4.1%) above the 2023 level and 228 Bcf (6.1%) higher than the five-year average.The total supply of natural gas averaged 107.5 Bcf per day, down 0.3 Bcf per day on a weekly basis, due to lower dry production partly offset by higher shipments from Canada.Meanwhile, daily consumption rose to 106.9 Bcf from 101.4 Bcf in the previous week, mainly reflecting higher residential/commercial usage and an increase in deliveries to U.S. LNG export facilities.Natural Gas Prices Finish HigherNatural gas prices rose last week following a smaller-than-expected inventory build. December futures closed at $2.823 on the New York Mercantile Exchange, marking a 5.8% increase.However, even with this gain, one has to consider the current natural gas supply surplus and the lingering uncertainty associated with it. With current inventories remaining above both last year’s levels and the five-year average, the rally can be short-lived. The relatively mild weather and demand for light heating are other factors to contend with. Investors must remember that natural gas prices dipped to a four-month low of $1.88 in late August, underscoring the market's ongoing volatility.How Should Investors Play Natural Gas Stocks?The natural gas market continues to struggle with oversupply, along with shifts in weather and production dynamics. As such, investors should remain cautious. Focusing on fundamentally strong stocks like Cheniere Energy, Range Resources and Shell plc —each carrying a Zacks Rank #3 (Hold) — may offer more stability amid the uncertainty.You can see the complete list of today’s Zacks #1 Rank stocks here.Cheniere Energy: Being the first company to receive regulatory approval to export LNG from its 2.6 billion cubic feet per day Sabine Pass terminal, Cheniere Energy enjoys a distinct competitive advantage.Cheniere Energy beat the Zacks Consensus Estimate for earnings in three of the last four quarters and missed in the other. The natural gas exporter has a trailing four-quarter earnings surprise of roughly 87.5%, on average. LNG shares have moved up 22.2% in a year.Find the latest EPS estimates and surprises on Zacks Earnings Calendar.Range Resources: The company is an U.S. independent natural gas producer with operations focused in the Appalachian Basin. Range Resources’ large contiguous acreage position provides more than 30 years of low-breakeven, high-return inventory. The company produced 202.8 Bcfe from these assets in the third quarter of 2024 — 68% natural gas.Range Resources beat the Zacks Consensus Estimate for earnings in each of the last four quarters. The upstream operator has a trailing four-quarter earnings surprise of roughly 28.8%, on average. RRC shares have edged up 0.5% in a year.Shell: Shell’s long-term strategy revolves around LNG. This London-based firm bought BG Group for $50 billion in 2016 to become the world’s largest producer and shipper of LNG. With LNG export demand likely to rise significantly in the near-to-medium term, Shell’s position as a major supplier should help it meet the fuel’s growing demand.SHEL beat the Zacks Consensus Estimate for earnings in each of the last four quarters. This natural gas exporter has a trailing four-quarter earnings surprise of roughly 15.4%, on average. Shell shares have lost 1.8% in a 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.7 Best Stocks for the Next 30 DaysJust released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."Since 1988, the full list has beaten the market more than 2X over with an average gain of +23.7% per year. So be sure to give these hand picked 7 your immediate attention. See them now >>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 Range Resources Corporation (RRC): Free Stock Analysis Report Plexus Corp. (PLXS): Free Stock Analysis Report Cheniere Energy, Inc. (LNG): Free Stock Analysis Report Olin Corporation (OLN): Free Stock Analysis Report Shell PLC Unsponsored ADR (SHEL): 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