Bank of America Reveals Market Share Gainers with More Room for Growth

Bank of America analysts listed a number of companies that they feel are gaining market share in the current challenging economic climate, giving the stocks additional potential to rise.

‍

This was a recurring trend in the most recent Bank of America analysis, which named many stocks poised to increase market share.

‍

These companies are Union Pacific, TJX Companies, Zeta Global, Costco, and Analog Devices.

TJX Businesses

‍

According to analyst Lorraine Hutchinson, the bargain store has an opportunity to expand, particularly as consumers want to save money by trading down.

‍

During the past year, firm shares have increased by 18%.

‍

Hutchinson said, "Our Buy recommendation supports our conviction that TJX will continue to push comps higher domestically as it attracts new customers with solid inventory management and outstanding execution.

‍

Hutchinson emphasized TJX's management, pointing out their history of exceeding expectations for both shareholders and customers.

‍

If traffic trend persists, "we anticipate significant upside to comp and margins," she added.

The expert advised investors to maintain their composure and look past the data even if TJX had released a generally mixed quarterly report.

‍

More significantly, Hutchinson believes there is still the possibility for long-term growth.

We retain our Buy recommendation because we believe TJX is a market share gainer that is well-positioned to gain from trade-down and the abundance of inventory, according to the analyst.

‍

Costco

As Costco released its fiscal second-quarter financial report, the company said that the big-box store is operating at full capacity.

‍

"COST fuels ongoing traffic increase in F2Q & into Feb," analyst Robert Ohmes stated.

Consumables strength and membership patterns are driving comps for the firm, he noted.

It is, in fact, the "best-run shop" in the US, according to Jim Cramer's Investment Club.

While shares have increased more than 4% this year, according to Ohmes, the stock's value is still favorable. The company's coveted top selections list includes Costco as well.

‍

Together with its "stable and growing EBITDA margins," Bank of America appreciates Costco's strong sourcing strategy, which, according to Ohmes, offers the company an edge over rivals.

Investors should purchase the stock due to these factors, he advised.

‍

"We reaffirm our Buy recommendation and continue to see Costco as a well-positioned LT given: Share growth led by COST's excellent value offering and pricing positioning," he said.

Zeta Global

Zeta Global's most recent quarterly report was recently highlighted by analyst Koji Ikeda, who said that the findings indicate the company's strength in software marketing solutions.

‍

Zeta's Q4 result "suggests the platform is delivering a solid value proposition in an environment where many marketing and advertising tech businesses are witnessing slowing client expenditure," Ikeda added.

‍

The analyst mentioned a positive revenue increase as a result of solid client growth.

Ikeda said, "We believe the results for the fourth quarter confirm our view that the company is distinctive, which should lead to sustained solid execution and upside potential to expectations.

The company said that as platform traffic grows over time, it increases profitability and generates more money.

‍

Ikeda stated, "We think Zeta Global has the ability to earn a market share in digital marketing and advertising expenditure budgets.

‍

This year, shares have increased by about 35%.

‍

Analog Devices

"Leader in FCF and best-in-class share gainer. With another solid quarter demonstrating strength from car demand and industrial variety, reiterate Buy and boost PO to $230 (from $215). We give ADI Buy a Buy rating based on its development initiatives in the industrial, automotive, and communications areas as well as its best-in-class free cash flow growth. Due to ADI's potential for development and ability to generate free cash flow, we value the company at the higher end of peer comparisons.

Union Pacific

"Raise to Buy; CEO Fritz resigns as an activist and requests operational knowledge. Only a few hours after activist investor Soroban Capital demanded that Chairman & CEO Lance Fritz resign, UNP announced in a statement on Sunday that he will do so in 2023. We raise our purchase order to $241 from $218 based on a 20x multiple of our projected EPS of $12.05 for 2024 and the possibility of increasing gains.

Costco

"Consumables strength and membership patterns fuel comps. COST drives continuing traffic increase in F2Q & through Feb. We reaffirm our Buy (and addition to BofA's US 1 List) and maintain that Costco is well-positioned LT given the following factors: 1) Share gains fueled by COST's strong value proposition and price positioning, 2) potential store acceleration given excess demand, 3) competitive advantages provided by COST's sourcing model, 4) stable & rising EBITDA margin, and 5) attractive valuation vs. all-time high ROIC.

TJX Companies

"We keep our Buy rating. as we see TJX as a market share gainer well positioned to profit from trade-down and strong inventory availability. …. If traffic momentum continues, we anticipate a significant upside in comp and margins. …. Our Buy recommendation underscores our expectation that TJX will continue to push domestic comps higher as it attracts new consumers through solid inventory management and great execution."

Zeta Global

"In an environment when many marketing & advertising tech companies are witnessing slowing consumer expenditure, Zeta's Q4 performance shows the platform is offering a solid value proposition. ... We believe the fourth-quarter results confirm our view that the company is distinctive, which should result in continued solid execution and upside potential to forecasts. ... We believe Zeta Global has the ability to increase its share of digital marketing and advertising expenses..."

‍