The week is young, but the stock market’s been busy. Here’s what we’re watching:
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🔥 HOT: United Airlines (NASDAQ: UAL) remains a top pick after signing a deal with Spotify to offer the latter company’s content for free on seatback displays starting next year. Better news for United is that a report from Panama City-based Copa Holding suggests that the demand for air travel is up more than 10% year-over-year through the first quarter of 2025. An overall uptick in demand for air travel, combined with the upcoming travel season, was enough to power UAL to a 4.8% gain on Friday. We give UAL a B Zen Rating and a Buy recommendation and remain cautiously optimistic about its potential through the end of 2025.
🥶 NOT: Broadcom (NASDAQ: AVGO) lost 5.0% on Friday after narrowly beating its EPS and revenue projections for the first quarter. Investors are skeptical of the company’s optimistic outlook for its AI revenue over the rest of the year. Our analysis gives the stock a D rating in safety and C ratings in Value and Growth, putting it in an awkward spot compared to other, higher-ranking stocks in its sector. Still, we give AVGO a C Zen Rating and a Hold recommendation for now since its Financials (B rating) are solid.
🔥 HOT: Online healthcare company Hims & Hers (NYSE: HIMS) gained 6.8% on Friday, ending a three-day losing streak and giving investors hope that the stock will hold onto the 34.6% it has gained since its last earnings report. HIMS is a solid stock, with A ratings in Growth and Financials and a B rating in Sentiment. The only thing that gives us pause is the D rating it gets in Artificial Intelligence. Because of the uncertainty introduced by the poor AI rating, HIMS gets a B Zen Rating instead of an A. The company’s European expansion could pay off in a big way over the coming months, but its success outside of the U.S. is far from a guarantee.
🥶 NOT: Shares of Lululemon Athletica (NASDAQ: LULU) plunged 19.8% on Friday after the company issued weak guidance during its first-quarter earnings report. Lululemon cut its full-year EPS guidance by almost $3.00, blaming competition and decreasing demand for the unexpectedly poor sales outlook. Despite the overall market performing well over the last month and a half, luxury brands like LULU tend to feel the pressure from economic uncertainty first, which could explain the decreasing demand. The company’s Financials are strong (A rating), but the Sentiment surrounding the company is not great (D rating). We give LULU a C Zen Rating and a Hold recommendation.
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