Intel And Amazon Among Today’s Top Trending Stocks

Monday brought relief to investors after several days of losses following the announcement of a shift in the Federal Reserve’s policies last Wednesday. Commodity and financial stocks helped lead the charge, with significant increases up in several energy and travel stocks, as well.

Though the market has a way to go after the S&P financials and materials sector lost 6%, with energy trailing just behind at 5% losses, the S&P 500 managed to claw its way up 1.4% from Monday’s opening, while the Dow Jones Industrial Average jumped nearly 1.8% on the day.

The tech-heavy Nasdaq Composite also managed to swing a 0.8% gain its way, even as key names in the sector – notably Amazon and Netflix – registered further losses from their astronomical highs.

Q.ai runs factor models daily to get the most up-to-date reading on stocks and ETFs. Our deep-learning algorithms use Artificial Intelligence (AI) technology to provide an in-depth, intelligence-based look at a company – so you don’t have to do the digging yourself.

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American Airlines Group Inc (AAL)

American Airlines Group, Inc. nudged up 0.27% Friday to close out the week at $22.29 per share on the back of 28 million trades. The stock is currently up 41.3% YTD.

Airline stocks in general have been trending in recent weeks as travel demand has increased heading into the summer months. Unfortunately for American Airlines, a combination of labor shortages and bad weather have meant that instead of expanding operations, the company will have to trim 1% of its flights – roughly 50 to 80 flights per day – through mid-July. The airline is hopeful that the cuts will boost the company’s resilience as the industry experiences its own supply and demand problems.

And hopefully, these cuts won’t slash too far into the company’s bottom line, as the airliner – like many of its peers – struggled in the last fiscal year. Revenue dropped to $17.3 billion compared to $44.5 billion three years ago, although operating profit actually grew 17.5% from $3.76 billion to over $11 billion. Moreover, per-share earnings jumped from $3.03 to $18.36 due to low share demand in the last fiscal year.

Currently, American Airlines is expected to pull in around 17.7% revenue growth in the next twelve months. Our deep-learning algorithms rate the company poorly, however, with a B in Technicals and F’s in Growth, Low Volatility Momentum, and Quality Value.

Amazon.com Inc (AMZN)

Amazon.com, Inc. slipped 0.07% on Friday to end the day at $3,486.90 per share with 5.2 million trades on the books, trading almost $200 over the 22-day price average. Currently, the stock is up 7% YTD and trading at 60.1x forward earnings.

Amazon is trending broadly in the news this week thanks to Amazon’s annual Prime Day, where participating dealers offer deeply discounted prices to hordes of virtually stampeding customers. But this year, Prime Day looks a little different as many sellers who’ve participated in the past simply don’t have enough items in stock – let alone the wiggle room in their profit margin – thanks to global supply-chain issues that have hit every industry from semiconductor chips to Starbuck coffee syrups.

That said, Prime Day historically isn’t a huge mover for the company’s stock – it’s more about Amazon’s bottom line, which has grown to monstrous proportions over the last three fiscal years. For instance, revenue has climbed from $232.9 billion to over $386 billion for a total of 80% growth in three years.

In the same period, operating income has shot up almost 140% to $22.9 billion compared to $12.4 billion, while per-share earnings have ballooned 161% to $41.83 against $20.14 three years ago. Return on equity has shrunk some – but only slightly – from 28.3% to 27.4% over the same 36 months.

Currently, Amazon is expected to see revenue growth around 3.9% in the next twelve months. With such a swollen balance sheet, not to mention its astronomical stock prices, our AI can’t see the online retail giant holding anything better than average value for investors at this time. As such, Q.ai rates Amazon.com B in Growth and Low Volatility Momentum, C in Quality Value, and D in Technicals.

Pzena Investment Management Inc (PZN)

Pzena Investment Management, Inc. is a New-York based value-oriented investment firm founded in 1995. The company serves institutional investors, high net worth retail investors, and investment professionals in both U.S. and international markets.

The company is trending this week after trading close to its all-time high in the previous few weeks, provoking increased interest – mostly, it appears, shares trading hands as investors cash in on their 44.1% gains YTD. Pzena closed down 6.6% on Friday to $10.52 per share against the 10-day average of $11.61.

In the course of the last fiscal year, Pzena saw revenue increase 8% to $138.6 million, a slight dip from the $153.6 million brought in three years ago. Operating income rose 21.6% to $55.3 million in the same 12-month time span compared to $78.8 million in the 36-month-ago period.

Additionally, per-share earnings leapt 46.6% in the last fiscal year, though at $0.52, EPS is down compared to the $0.77 seen in the previous three years. Moreover, return on equity has plunged significantly from 68.9% to just under 47.5% in the same period.

Currently, our AI rates Pzena Investment Management B in Growth and Quality Value, C in Low Volatility Momentum, and D in Technicals.

Intel Corporation (INTC)

Intel Corporation closed down 2.6% Friday to $55.67 per share with 55.1 million trades on the books. The stock is up 11.7% YTD and is trading at 13.1x forward earnings.

Despite the company’s troubles – including supply chain and production issues, as well as the tech giant falling behind technologically compared to foreign competitors such as Nvidia and Taiwan Semiconductor – Intel remains the world’s largest semiconductor manufacturer by revenue. In fact, Intel’s products alone account for nearly 20% of global spending on semiconductors even as companies like Apple plan their leave.

However, Intel is planning a turnaround gambit in the coming years by attempting to allocate $20 billion of its massive revenues into new fabrication plants in the Arizona desert. (And how will the new plant fund its water-hungry processes, you ask? Intel has an answer for that too, in the form of funding no less than 15 water restoration projects to achieve “net positive water use” in the next few years.)

However, it may be a while before the world’s largest semiconductor manufacturer sees significant YOY growth again. In the last three fiscal years, Intel’s revenue has shifted up 9.7% to $77.9 billion compared to $70.8 billion. In the same period, operating income barely inched up to $23.88 billion against $23.24 billion. And per-share earnings have risen slightly to $4.48 compared to $4.94 three years ago.

Still, for the time being, our AI rates Intel a below-par prospect for your portfolio, with a C in Low Volatility Momentum and Quality Value and D in Technicals and Growth.

Exelon Corporation (EXC)

Exelon Corporation closed down Friday to $44.55, a change of 3.2% on the day on the back of 11.8 million trades. The stock remains up 5.5% so far this year and is trading at 12.6x forward earnings.

Exelon Corporation is an American Fortune 100 energy company with a focus in nuclear electric power generation. That said, Exelon maintains holdings in several hydro, solar, and wind power operations as well.

The company has the distinction of holding four unique labels: the largest electric parent company in the U.S. by revenue; the largest regulated electric utility in the U.S. with 10 million customers; the largest operator of nuclear power plants in the U.S.; and the largest non-governmental operator of nuclear power plants worldwide.

In the last fiscal year, Exelon’s revenue has grown 3.5% to $33 billion compared to $36 billion three years ago. Operating income has also fallen in the previous 36-month period from $4.4 billion to $4.3 billion, and per-share earnings have remained almost steady at $2.01 last year and $2.07 three years ago.

Currently, Exelon is expected to see forward 12-month revenue growth around 2.5%. Our AI rates the company as a poor investment at this time, with an A in Low Volatility Momentum, C in Technicals and Growth, and D in Quality Value.

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