Core Insights - The article discusses the importance of the price-to-book (P/B) ratio in value investing, highlighting its utility in identifying undervalued stocks with strong growth potential [1][2]. Group 1: Understanding P/B Ratio - The P/B ratio is calculated by dividing the current stock price by the book value per share, indicating how much investors pay for each dollar of book value [2][6]. - A P/B ratio of less than one suggests that a stock is undervalued, while a ratio greater than one indicates it may be overvalued [6][7]. - The P/B ratio is particularly relevant for industries with tangible assets, such as finance and manufacturing, but may be misleading for companies with high R&D expenses or negative earnings [9][10]. Group 2: Investment Opportunities - Five stocks identified as having low P/B ratios include StoneCo (STNE), CVS Health (CVS), KT Corporation (KT), KB Financial Group (KB), and USANA Health Sciences (USNA) [11][16]. - These stocks have Zacks Rank 1 or 2 and Value Scores of A or B, with projected EPS growth rates ranging from 11.9% to 49.9%, indicating strong potential [11][17][19][20][21]. Group 3: Screening Parameters - Screening parameters for identifying attractive stocks include P/B ratio less than the industry median, P/S ratio less than the industry median, and P/E ratio less than the industry median [12][13]. - A PEG ratio of less than 1 indicates undervaluation relative to future growth prospects, while a minimum stock price of $5 and an average trading volume of at least 100,000 are also considered [14][15].

Core Insights - MercadoLibre (MELI) operates the largest e-commerce and fintech ecosystem in Latin America, focusing on marketplace services, logistics, digital payments, and credit solutions across key markets like Brazil, Mexico, and Argentina [1] - The company is experiencing sustained margin pressure as it prioritizes market expansion over short-term profitability, with the operating margin contracting 210 basis points year-over-year to 12.2% in Q2 2025 [1][10] - Significant investments in user acquisition and engagement, particularly in fintech, are expected to keep spending elevated, impacting margins until operational efficiencies are realized [2] Financial Performance - The credit operations portfolio has grown 91% year-over-year to $9.3 billion, leading to higher provisioning and funding costs [3] - The Zacks Consensus Estimate for Q3 2025 earnings is $9.88 per share, revised downward by 16.6% over the past 30 days, indicating a year-over-year growth of 26.18% [14] - The consensus for 2025 earnings is $44.63 per share, also revised downward by 6.5%, suggesting an 18.41% year-over-year growth [15] Competitive Landscape - Mercado Pago competes with NU and StoneCo in the rapidly growing digital finance sector in Latin America [6] - Both competitors are expanding their product portfolios and increasing customer engagement, intensifying competition in the fintech space [7] Market Trends - E-commerce penetration in core markets remains low, indicating significant growth potential, but the heavy investments required may restrain short-term profitability [5] - Logistics costs are rising due to Brazil's expanded free shipping threshold, adding further pressure on margins [4][10] Stock Performance and Valuation - MELI shares have increased by 38.3% year-to-date, outperforming the Zacks Internet – Commerce industry and the Zacks Retail-Wholesale sector [8] - The stock is currently trading at a forward 12-month Price/Sales ratio of 3.68X, compared to the industry's 2.27X, indicating a relatively high valuation [12]

Core Insights - Shopify (SHOP) reported strong second-quarter 2025 results with non-GAAP earnings of 35 cents per share, exceeding the Zacks Consensus Estimate by 25% and reflecting a 34.6% year-over-year increase [1][9] - Revenues reached $2.68 billion, surpassing the Zacks Consensus Estimate by 5.47% and showing a 31.1% year-over-year growth [1][9] - Following the earnings report, Shopify shares rose 22%, with a year-to-date increase of 45.7%, significantly outperforming the Zacks Computer and Technology sector's return of 10.9% [2] Revenue and Growth Metrics - Gross Merchandise Volume (GMV) for Q2 was $87.84 billion, a 30.6% year-over-year increase, driven by a growing merchant base and strong international performance [3][9] - Merchant solutions revenues were $2.02 billion, accounting for 75.5% of total revenues, with a year-over-year increase of 36.6% [4][9] - Subscription solutions revenues reached $656 million, representing 24.5% of total revenues and a 16.5% year-over-year increase [5] Operating Performance - Gross profit for the quarter was $1.3 billion, up 24.6% year over year, with Merchant Solutions' gross profit growing by 32% [7][9] - Total operating expenses were $1.01 billion, a 25.7% year-over-year increase, but as a percentage of revenues, they declined by 160 basis points to 37.7% [7] - Adjusted operating income was $291 million, reflecting a 20.7% year-over-year increase, while operating margin contracted by 90 basis points to 10.9% [10] Cash Flow and Balance Sheet - As of June 30, 2025, cash and cash equivalents totaled $5.82 billion, up from $5.51 billion at the end of Q1 [11] - Free cash flow increased by 26.7% year over year to $422 million, with a free cash flow margin of 15.7% [11] Future Guidance - For Q3 2025, Shopify anticipates revenue growth in the mid-to-high twenties percentage range year over year, with a consensus estimate of $2.63 billion [12] - Gross profit is expected to grow at a low-twenties percentage rate year over year, while GAAP operating expenses as a percentage of revenues are projected to be in the 38-39% range [13]

Core Insights - MKS Inc. (MKSI) reported second-quarter 2025 adjusted earnings of $1.77 per share, exceeding the Zacks Consensus Estimate by 9.94% and reflecting a year-over-year increase of 15.7% [1] - Revenues reached $973 million, surpassing the consensus mark by 4.61% and showing a year-over-year growth of 9.7% [1] - MKSI shares rose 6.6% in pre-market trading, although the company has experienced a 14.2% decline year to date, underperforming the Zacks Computer and Technology sector's 12.2% [1] Revenue Breakdown - Product revenues, accounting for 87.2% of total revenues, were $848 million, up 10.1% year over year [2] - Service revenues, making up 12.8% of total revenues, increased 6.8% year over year to $125 million [2] - Revenues from the Semiconductor market, which constituted 44.4% of total revenues, rose 17.1% year over year to $432 million [3] - Electronics & Packaging revenues, representing 27.3% of total revenues, were $266 million, up 16.2% year over year [3] - Specialty Industrial revenues, accounting for 28.3% of total revenues, declined 4.8% year over year to $275 million [3] Segment Performance - Revenues from Vacuum Solutions, which made up 41.8% of total revenues, increased 21.5% year over year to $407 million [4] - Photonics Solutions revenues, comprising 25% of total revenues, decreased 4.3% year over year to $243 million [4] - Materials Solutions revenues, accounting for 33.2% of total revenues, climbed 8.4% year over year to $323 million [4] Operating Metrics - The adjusted gross margin contracted by 70 basis points year over year to 46.6% [5] - Adjusted EBITDA rose 5.3% year over year to $240 million, with the adjusted EBITDA margin contracting 100 basis points year over year to 24.7% [5] - Total operating expenses increased 10.6% year over year to $251 million [5] - Non-GAAP operating income was reported at $202 million, up 5.2% year over year, with the adjusted operating margin contracting 90 basis points year over year to 20.8% [6] Balance Sheet Overview - As of June 30, 2025, cash and cash equivalents stood at $674 million, up from $655 million as of March 31 [7] - Long-term debt was reported at $4.36 billion [7] - Cash flow from operations was $165 million in Q2 2025, compared to $141 million in Q1 2025 [7] - Free cash flow increased to $136 million from $123 million in the previous quarter [7] Q3 Guidance - For Q3 2025, MKSI expects revenues of $960 million, with a variance of plus or minus $40 million [9] - The company anticipates a gross margin of 46.5% (plus or minus 1%) and an adjusted EBITDA of $232 million (plus or minus $24 million) [9] - Non-GAAP earnings are projected at $1.80 per share, with a variance of plus or minus $0.29 [9]

Core Insights - Fastly (FSLY) reported a non-GAAP loss of 3 cents per share for Q2 2025, beating the Zacks Consensus Estimate by 40% and improving from a loss of 6 cents per share in the same quarter last year [1] - Revenues increased by 12.3% year over year to $148.7 million, surpassing the Zacks Consensus Estimate by 2.51% [1] - Fastly shares rose by 10.6% in pre-market trading, although they have declined by 30.9% year to date, underperforming the broader Zacks Computer and Technology sector, which returned 11% [1] Revenue Breakdown - Network services revenues grew by 10% year over year to $114.9 million [2] - Security revenues increased by 15% year over year to $29.3 million [2] Customer Metrics - The enterprise customer count reached 622, an increase of 21 from the previous year [3] - The top 10 customers contributed 31% of revenues, down from 34% in the year-ago quarter, with revenues from these customers increasing by 2% year over year [3] - Revenues from customers outside the top 10 rose by 17% year over year [3] Financial Performance - Non-GAAP gross margin was 59%, a contraction of 40 basis points year over year [3] - Research and development expenses rose by 12.3% year over year to $30.5 million, while general and administrative expenses increased by 9.6% to $21.2 million [4] - Sales and marketing expenses decreased by 6.8% year over year to $40.6 million [4] - Adjusted EBITDA margin expanded by 450 basis points year over year to 6% [4] - Non-GAAP operating loss was $4.6 million, an improvement from the $11.5 million loss reported in the same quarter last year [4] Balance Sheet - As of June 30, 2025, cash and cash equivalents stood at $1.07 billion, up from $924.7 million as of March 31 [5] Future Guidance - Fastly expects Q3 2025 revenues to be between $149 million and $153 million, indicating a growth of 7.9% from the year-ago quarter [6] - Non-GAAP operating income is projected to range from a loss of $1 million to earnings of $3 million, with expected earnings per share between a loss of 2 cents and earnings of 2 cents [7] - For the full year 2025, revenues are anticipated to be between $594 million and $602 million, reflecting an 8.6% growth from 2024 [8]

Core Insights - Serve Robotics (SERV) is expected to report its second-quarter 2025 results on August 7, with previous earnings exceeding the Zacks Consensus Estimate by 23.8% [1] Financial Estimates - The Zacks Consensus Estimate for SERV's second-quarter 2025 loss per share is 23 cents, compared to an adjusted loss of 27 cents in the same quarter last year, with the consensus remaining unchanged over the past 30 days [2] - Revenue estimates for the quarter are projected at $0.64 million, reflecting a 35.1% increase from the previous year's figure [2] Growth Drivers - The anticipated revenue growth is attributed to the rapid expansion of SERV's robot fleet and geographic reach, with over 250 Gen 3 robots added in Q1 2025 and a planned launch in Atlanta [3] - Delivery volumes are expected to increase by 60% to 75% quarter over quarter due to the expansion into high-density areas and new partnerships with merchants like Shake Shack [3] - SERV is also unlocking new revenue opportunities through its software platform, aiming to generate recurring revenues from external partners in sectors such as automotive and logistics [4] Profitability Challenges - Despite the growth in revenue, SERV's aggressive expansion strategy is likely to continue impacting profitability negatively, with high costs associated with research and development, market launches, and operational infrastructure [5] - The increasing share of early-stage fleet revenues, which typically have lower margins than software services, adds further pressure on the overall margin profile [5] Earnings Outlook - According to the Zacks model, SERV currently has an Earnings ESP of 0.00% and a Zacks Rank of 3, indicating that the odds of an earnings beat are not favorable at this time [6]

Core Insights - The New York Times Company (NYT) demonstrated solid performance in Q2 2025, with adjusted earnings per share of 58 cents, exceeding the Zacks Consensus Estimate of 50 cents, and total revenues of $685.9 million, which surpassed the estimate of $669 million, reflecting a year-over-year increase of 9.7% [1][11] Subscription Performance - NYT added approximately 230,000 net digital-only subscribers in the quarter, bringing total subscribers to 11.88 million, with 11.30 million being digital-only [2][5] - Digital-only average revenue per user (ARPU) rose to $9.64 from $9.34 year-over-year, driven by subscribers moving from promotional pricing to higher rate plans [3] - Subscription revenues reached $481.4 million, a 9.6% increase year-over-year, with digital-only subscription revenues increasing by 15.1% to $350.4 million [4][5] Advertising Revenues - Total advertising revenues increased by 12.4% year-over-year to $134 million, with digital advertising revenues rising 18.7% to $94.4 million, while print advertising revenues slightly declined by 0.1% to $39.6 million [6][11] - For Q3, the company anticipates a low-to-mid-single-digit increase in total advertising revenues and a low-double-digit increase in digital advertising revenues [7] Other Revenue Streams - Affiliate, licensing, and other revenues grew by 5.8% year-over-year to $70.5 million, attributed to higher Wirecutter affiliate referral revenues [8] - Adjusted operating costs rose by 6.1% to $552.1 million, with expectations of a 5-6% increase in Q3 [8] Financial Health - The company ended the quarter with cash and marketable securities totaling $951.5 million, an increase of $39.7 million from the previous quarter [14] - NYT repurchased 460,136 shares of its Class A common stock for $23.6 million, with approximately $422.2 million remaining for further repurchases [15]

Core Insights - The U.S. market experienced a slight decline as investors reacted to new earnings reports, economic data, and tariff announcements, particularly regarding semiconductor and pharmaceutical imports [1] - In the current environment characterized by geopolitical risks and policy changes, value investing is highlighted as a favorable strategy, focusing on purchasing undervalued stocks [1] Investment Strategy - Value investing involves buying stocks priced below their intrinsic value, capitalizing on market mispricing to achieve future profits [1] - Earnings yield is a key metric for value investors, calculated as (Annual Earnings per Share/Market Price) x 100, serving as a reverse indicator of the price-to-earnings (P/E) ratio [3] - A high earnings yield suggests a stock may be undervalued, while a low yield indicates potential overvaluation [3] Stock Selection Criteria - An earnings yield greater than 10% is set as a primary screening criterion, supplemented by additional parameters [5] - Estimated EPS growth for the next 12 months must be greater than or equal to the S&P 500, comparing forward EPS estimates with actual EPS [5] - Average daily trading volume over the past 20 days should be at least 100,000, indicating sufficient liquidity [6] - Current stock price must be $5 or higher, and stocks with a Zacks Rank of 1 (Strong Buy) or 2 (Buy) are expected to outperform peers [7] Highlighted Stocks - Barrick Mining Corporation is a leading gold mining company with projected earnings growth of 56% and 24% for 2025 and 2026, respectively, and a Zacks Rank of 1 [8] - Astrana Health, a tech-enabled healthcare provider, anticipates earnings growth of 77% and 49% for 2025 and 2026, respectively, also holding a Zacks Rank of 1 [9][10] - StoneCo Ltd., a fintech company, expects earnings growth of 10.4% and 16% for 2025 and 2026, with a Zacks Rank of 1 [11] - Plains GP Holdings, involved in crude oil transportation and marketing, projects earnings growth of 206% and 24% for 2025 and 2026, respectively, and has a Zacks Rank of 1 [12] - PHINIA Inc., a supplier for the mobility industry, forecasts earnings growth of 14% and 19.5% for 2025 and 2026, respectively, and holds a Zacks Rank of 1 [13]

Group 1: Core Insights - Several tech stocks are gaining attention for their affordability and strong buy ratings, supported by positive earnings estimate revisions [1][2] - The Zacks Internet-Software Industry is in the top 32% of over 240 Zacks industries, highlighting the potential for growth among its companies [3] Group 2: Company Highlights - Udemy (UDMY) has shown increased profitability, with annual earnings expected to rise 194% in fiscal 2025 to $0.47 per share, and projected EPS growth of 24% in FY26 [5][6] - StoneCo (STNE) is trading under $15 per share with a forward earnings multiple of 8.5X, and is expected to see EPS growth of 10% this year and 16% in FY26 [7][8] - Hewlett Packard (HPE) is trading under $20 per share with a forward earnings multiple of 10X, and has surpassed $1 billion in AI systems revenue, with projected top-line growth of over 14% in FY25 and FY26 [9][10] Group 3: Financial Metrics - Udemy's EPS estimates for FY25 and FY26 are $0.47 and $0.58 respectively, with a year-over-year growth estimate of 193.75% for FY25 [6] - StoneCo's annual sales exceed $2 billion, with EPS expected to rise to $1.73 in FY26 [7] - Hewlett Packard's annualized revenue run rate for AI systems reached $2.2 billion, with EPS projected to rebound to $2.30 in FY26 [10][13]

Core Insights - Unity Software Inc. is set to release its second-quarter 2025 results, with previous earnings surpassing estimates by 50% [1] Q2 Estimate Revisions - The Zacks Consensus Estimate for Unity's Q2 2025 loss per share is 25 cents, compared to an adjusted loss of 32 cents in the same quarter last year, with no changes in the consensus over the past week [2] - Revenue estimates for Q2 are projected at $425.8 million, reflecting a 5.2% decline from the previous year's figure [2] Earnings Surprise History - Unity has consistently beaten earnings expectations, achieving this in the last four quarters with an average surprise of 28% [3] Factors Influencing Q2 Performance - The company's revenue in Q2 is expected to be impacted by the transition to the AI-powered Unity Vector platform, which may not have fully realized its financial benefits yet [4] - Declines in revenue from legacy ad products like ironSource and Tapjoy are anticipated due to resource reallocation towards Vector, creating short-term revenue friction [4] - A slight sequential decline in the Create segment is forecasted due to the winding down of non-strategic revenue streams, although subscription growth continues [5] Cost Considerations - Elevated R&D and cloud infrastructure costs during the transition period are expected to normalize in the second half of the year, but may have negatively impacted profitability in Q2 [6] Earnings Whispers - The model predicts an earnings beat for Unity, supported by a positive Earnings ESP of +40.00% and a Zacks Rank of 2 (Buy) [7][8]