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LOS ANGELES, June 10, 2026 (GLOBE NEWSWIRE) -- The Schall Law Firm, a national shareholder rights litigation firm, announces that it is investigating claims on behalf of investors of Zscaler (“Zscaler” or “the Company”) (NASDAQ: ZS) for violations of the securities laws.

The investigation focuses on whether the Company issued false and/or misleading statements and/or failed to disclose information pertinent to investors. ZS is the subject of a report by CNBC on May 27, 2026, which stated the Company’s shares “tumbled more than 23% after the cloud security company guided for current-quarter revenue of between $875 million to $878 million, falling short of the $879 million analysts were seeking, per LSEG.” Based on this news, shares of Zscaler opened down more than 30% on the same day.

If you are a shareholder who suffered a loss, click here to participate.

We also encourage you to contact Brian Schall of the Schall Law Firm, 2049 Century Park East, Suite 2460, Los Angeles, CA 90067, at 310-301-3335, to discuss your rights free of charge. You can also reach us through the firm's website at www.schallfirm.com, or by email at [email protected].

The Schall Law Firm represents investors around the world and specializes in securities class action lawsuits and shareholder rights litigation.

This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and rules of ethics.

CONTACT:

The Schall Law Firm 
Brian Schall, Esq. 
310-301-3335
[email protected]

www.schallfirm.com

Zscaler, Inc. (ZS) Presents at Zenith-live-2026 Transcript

, /PRNewswire/ -- The Schall Law Firm, a national shareholder rights litigation firm, announces that it is investigating claims on behalf of investors of Zscaler ("Zscaler" or "the Company") (NASDAQ: ZS) for violations of the securities laws.

The investigation focuses on whether the Company issued false and/or misleading statements and/or failed to disclose information pertinent to investors. ZS is the subject of a report by CNBC on May 27, 2026, which stated the Company's shares "tumbled more than 23% after the cloud security company guided for current-quarter revenue of between $875 million to $878 million, falling short of the $879 million analysts were seeking, per LSEG." Based on this news, shares of Zscaler opened down more than 30% on the same day.

If you are a shareholder who suffered a loss, click here to participate.

We also encourage you to contact Brian Schall of the Schall Law Firm, 2049 Century Park East, Suite 2460, Los Angeles, CA 90067, at 310-301-3335, to discuss your rights free of charge. You can also reach us through the firm's website at www.schallfirm.com, or by email at [email protected].

The Schall Law Firm represents investors around the world and specializes in securities class action lawsuits and shareholder rights litigation.

This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and rules of ethics.

CONTACT:

The Schall Law Firm 
Brian Schall, Esq. 

310-301-3335

[email protected]

www.schallfirm.com

SOURCE The Schall Law Firm

Zscaler (ZS - Free Report) has been one of the most searched-for stocks on Zacks.com lately. So, you might want to look at some of the facts that could shape the stock's performance in the near term.

Over the past month, shares of this cloud-based information security provider have returned -18%, compared to the Zacks S&P 500 composite's -0.2% change. During this period, the Zacks Security industry, which Zscaler falls in, has gained 25.6%. The key question now is: What could be the stock's future direction?

Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.

Earnings Estimate RevisionsRather than focusing on anything else, we at Zacks prioritize evaluating the change in a company's earnings projection. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings.

We essentially look at how sell-side analysts covering the stock are revising their earnings estimates to reflect the impact of the latest business trends. And if earnings estimates go up for a company, the fair value for its stock goes up. A higher fair value than the current market price drives investors' interest in buying the stock, leading to its price moving higher. This is why empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For the current quarter, Zscaler is expected to post earnings of $1.08 per share, indicating a change of +21.4% from the year-ago quarter. The Zacks Consensus Estimate has changed +531.3% over the last 30 days.

The consensus earnings estimate of $4.13 for the current fiscal year indicates a year-over-year change of +25.9%. This estimate has changed +436.5% over the last 30 days.

For the next fiscal year, the consensus earnings estimate of $4.58 indicates a change of +10.9% from what Zscaler is expected to report a year ago. Over the past month, the estimate has changed +0.8%.

With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #3 (Hold) for Zscaler.

The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:

12 Month EPS

Projected Revenue GrowthWhile earnings growth is arguably the most superior indicator of a company's financial health, nothing happens as such if a business isn't able to grow its revenues. After all, it's nearly impossible for a company to increase its earnings for an extended period without increasing its revenues. So, it's important to know a company's potential revenue growth.

In the case of Zscaler, the consensus sales estimate of $877.03 million for the current quarter points to a year-over-year change of +21.9%. The $3.33 billion and $3.9 billion estimates for the current and next fiscal years indicate changes of +24.5% and +17.3%, respectively.

Last Reported Results and Surprise HistoryZscaler reported revenues of $850.47 million in the last reported quarter, representing a year-over-year change of +25.4%. EPS of $1.08 for the same period compares with $0.84 a year ago.

Compared to the Zacks Consensus Estimate of $834.76 million, the reported revenues represent a surprise of +1.88%. The EPS surprise was +8%.

The company beat consensus EPS estimates in each of the trailing four quarters. The company topped consensus revenue estimates each time over this period.

ValuationNo investment decision can be efficient without considering a stock's valuation. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance.

Comparing the current value of a company's valuation multiples, such as its price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), to its own historical values helps ascertain whether its stock is fairly valued, overvalued, or undervalued, whereas comparing the company relative to its peers on these parameters gives a good sense of how reasonable its stock price is.

As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B; B is better than C; and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.

Zscaler is graded F on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.

ConclusionThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Zscaler. However, its Zacks Rank #3 does suggest that it may perform in line with the broader market in the near term.

Key Takeaways WTI crude above $90 keeps ExxonMobil and ConocoPhillips in focus as investors chase energy stocks.XOM targets 1.8M oil-equivalent barrels from the Permian, using lightweight proppant to lift recoveries.ConocoPhillips has low-cost drilling in Permian, Eagle Ford and Bakken; its debt-to-cap is 26.55%. Oil prices remain in bullish territory, keeping energy companies in the spotlight. Many investors are looking to capitalize on elevated oil prices by betting on energy stocks. Against this backdrop, let us compare two energy giants, Exxon Mobil Corporation (XOM - Free Report) and ConocoPhillips (COP - Free Report) , to determine which stock offers a better buying opportunity now.

High Oil Price to Aid Upstream Operations of XOM, COPWest Texas Intermediate (“WTI”) crude is trading at more than the $90-per-barrel mark. The high price is being backed by ongoing tensions in the Middle East. The U.S. Energy Information Administration (“EIA”) in its latest short-term energy outlook projected WTI at $85.68 per barrel for this year, higher than $65.40 last year. A highly favorable pricing environment for the commodity is likely to continue supporting ExxonMobil's exploration and production activities, which contribute to the majority of its earnings.

To provide a glimpse of the upstream assets, the company has a massive footprint in the Permian, the most prolific oil and gas play in the United States, and offshore Guyana. In the Permian, the integrated giant has been employing lightweight proppant technology and hence is capable of boosting its well recoveries by up to as much as 20%. On the first quarter earnings call, XOM mentioned that it is staying aligned with its plan of growing its production in the most prolific basin to 1.8 million oil equivalent barrels this year.

In Guyana, XOM has made several oil and gas discoveries, further highlighting its solid production outlook. Record production from both resources has been aiding its top and bottom lines. In both resources, the breakeven costs are low.

With its solid portfolio of upstream assets, COP is well-positioned to gain. The upstream energy giant has low-cost drilling opportunities across Permian, Eagle Ford and Bakken that could be successfully developed over two decades. The outlook for ConocoPhillips’ upstream operations also looks highly profitable.

Low Debt Burden of XOM & COP a Savior During UncertaintyBoth ConocoPhillips and XOM have strong balance sheets that they could rely on during an unfavorable business environment. The debt-to-capitalization of ExxonMobil is only 15.44%, lower than COP’s 26.55%.

Image Source: Zacks Investment Research

Thus, both the energy giants could rely on their balance sheet strengths to run their operations smoothly when the business scenario turns unfavorable.

XOM vs. COP: Which is a Better Stock?Coming to the price chart, both ExxonMobil and ConocoPhillips have had a strong run-up over the past year. Over the period, XOM has jumped 50.3%, while COP gained 41.4%.

Image Source: Zacks Investment Research

On a relative basis, XOM is trading at a 10.24x trailing 12-month Enterprise Value to Earnings Before Interest, Taxes, Depreciation and Amortization (EV/EBITDA), which is a discount compared with COP’s 6.59x.

Image Source: Zacks Investment Research

Thus, it has become evident that investors are willing to pay a premium for XOM over COP. This is because, although both XOM and COP are benefiting from the ongoing strength in oil prices, being an integrated energy player with a footprint in refining and chemicals businesses, ExxonMobil’s operation is relatively more stable, making it a better investment pick. Currently, XOM sports a Zacks Rank #1 (Strong Buy).

However, investors willing to take on more risk to capitalize primarily on high oil prices may consider ConocoPhillips, which currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

On a recent episode of The Real Eisman Playbook, Bernstein Research senior energy analyst Bob Brackett made a claim that should change how income investors look at the oil majors. “Don’t compare the yields you get from a commodity company to government yields. Compare them to TIPS. These are inflation protected,” he told host Steve Eisman. That single reframing is the entire bull case for owning Exxon Mobil (NYSE:XOM | XOM Price Prediction), Chevron (NYSE:CVX), and ConocoPhillips (NYSE:COP) in a portfolio’s income sleeve.

A 10-year Treasury today pays 4.57% in nominal terms. The 10-year TIPS real yield is 2.16%. That TIPS number is the honest benchmark for any asset whose cash flows adjust to inflation. An Exxon or Chevron dividend is, by definition, indexed to a barrel of oil.

The “My 3% Dividend From Exxon” Thesis Brackett’s clearest articulation: “My 3% dividend from Exxon, if the dollar devalues, the barrel of oil gets more valuable and they’ll sustain that.” A fixed Treasury coupon cannot do that. The bond pays the same dollars whether the dollar buys a loaf of bread or half a loaf next year.

The numbers back Exxon’s durability. The company posted a $1.03 per share Q2 2026 dividend payable June 10, 2026, sitting on a 43-year dividend growth streak and a planned $20 billion of share repurchases in 2026. Underlying Q1 2026 earnings rose to $8.77 billion from $7.58 billion from a year earlier, per the company’s Q1 2026 8-K filing. CEO Darren Woods called Exxon “a fundamentally stronger company than it was just a few years ago, built to perform through disruption and across market cycles.”

Exxon shares are up 30% year to date and 55% over one year, helped by WTI crude trading at $112.25 per barrel as of May 18, 2026, near a 12-month high.

The COVID Stress Test Brackett’s evidence that these dividends are real runs through 2020. During COVID, demand collapsed by roughly 20 million barrels per day. The US majors paid through it. Exxon, Chevron, and ConocoPhillips maintained their dividends through the COVID demand shock. European peers Shell, BP, and Total cut theirs during the same period.

The dividend history confirms it. Exxon held its quarterly payout at $0.87 through all of 2020. Chevron held at $1.29 per quarter throughout 2020 and has now stacked a 39-year run of annual increases, paying $1.78 per share for Q2 2026. Chevron’s Q1 2026 results delivered $2.5 billion in repurchases, the 16th consecutive quarter of more than $5 billion returned to shareholders.

Collectively, the US majors are returning roughly $30 billion to $50 billion annually through dividends and buybacks while still growing. Brackett calls them “really attractive widows and orphans, pack them away, compound for a long time.”

Why Eisman Says They’re Finally Ownable Steve Eisman, who spent much of his career hating the E&P sector, brought the historical frame. “Until maybe 2016, ’17, I thought they were run by lunatics,” he said. CEOs would “drill baby drill” regardless of commodity prices, apparently compensated on volume rather than returns. “These were companies that were crazy” and “not ownable” back then. Today, after shareholder pressure rewired comp plans toward returns on capital, Eisman calls them “almost ownable.”

ConocoPhillips is exhibit A of the new discipline. The company is targeting 45% of cash from operations returned to shareholders in 2026, with over $1 billion in run-rate synergies from the completed Marathon Oil deal. The Q2 2026 dividend of $0.84 per share follows an increase from $0.78 in late 2025. Shares are up 31% year to date.

The Practical Takeaway I’ve been watching this sector reluctantly for the better part of a decade, mostly because Eisman’s old view was correct: management teams torched capital chasing rigs. Something changed around 2017. The buybacks got bigger, debt got smaller, and the Q1 2026 numbers across all three majors confirm the new playbook is holding.

When you screen for income, the choice between a Treasury and a dividend stock has always felt binary. Brackett’s reframe collapses that wall. A commodity-backed dividend from a disciplined operator behaves more like an inflation-linked bond than an equity coupon. That doesn’t make energy risk-free, and oil at the 98.4th percentile of its 12-month range is a reminder of how quickly the setup can change. But against a 2.16% real yield on TIPS, a 3% dividend backed by a barrel of oil deserves a place in the income sleeve of the portfolio alongside inflation-protected bonds.

ConocoPhillips offers compelling value at $114, trading at 11.6x forward P/E and yielding 2.9%, supported by robust fundamentals. COP's growth is underpinned by the Willow project in Alaska and an expanding LNG platform, including Port Arthur LNG nearing first production. Strong balance sheet with A- credit rating, and a shareholder-friendly capital return policy reinforce COP's investment appeal.

Taking full advantage of the stock market and investing with confidence are common goals for new and old investors, and Zacks Premium offers many different ways to do both.

The popular research service can help you become a smarter, more self-assured investor, giving you access to daily updates of the Zacks Rank and Zacks Industry Rank, the Zacks #1 Rank List, Equity Research reports, and Premium stock screens.

It also includes access to the Zacks Style Scores.

What are the Zacks Style Scores? The Zacks Style Scores is a unique set of guidelines that rates stocks based on three popular investing types, and were developed as complementary indicators for the Zacks Rank. This combination helps investors choose securities with the highest chances of beating the market over the next 30 days.

Each stock is given an alphabetic rating of A, B, C, D or F based on their value, growth, and momentum qualities. With this system, an A is better than a B, a B is better than a C, and so on, meaning the better the score, the better chance the stock will outperform.

The Style Scores are broken down into four categories:

Value ScoreFinding good stocks at good prices, and discovering which companies are trading under their true value, are what value investors like to focus on. So, the Value Style Score takes into account ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and a host of other multiples to highlight the most attractive and discounted stocks.

Growth ScoreWhile good value is important, growth investors are more focused on a company's financial strength and health, and its future outlook. The Growth Style Score takes projected and historic earnings, sales, and cash flow into account to uncover stocks that will see long-term, sustainable growth.

Momentum ScoreMomentum investors, who live by the saying "the trend is your friend," are most interested in taking advantage of upward or downward trends in a stock's price or earnings outlook. Utilizing one-week price change and the monthly percentage change in earnings estimates, among other factors, the Momentum Style Score can help determine favorable times to buy high-momentum stocks.

VGM ScoreIf you like to use all three kinds of investing, then the VGM Score is for you. It's a combination of all Style Scores, and is an important indicator to use with the Zacks Rank. The VGM Score rates each stock on their shared weighted styles, narrowing down the companies with the most attractive value, best growth forecast, and most promising momentum.

How Style Scores Work with the Zacks Rank The Zacks Rank, which is a proprietary stock-rating model, employs earnings estimate revisions, or changes to a company's earnings expectations, to make building a winning portfolio easier.

It's highly successful, with #1 (Strong Buy) stocks producing an unmatched +23.7% average annual return since 1988. That's more than double the S&P 500. But because of the large number of stocks we rate, there are over 200 companies with a Strong Buy rank, plus another 600 with a #2 (Buy) rank, on any given day.

This totals more than 800 top-rated stocks, and it can be overwhelming to try and pick the best stocks for you and your portfolio.

That's where the Style Scores come in.

You want to make sure you're buying stocks with the highest likelihood of success, and to do that, you'll need to pick stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you like a stock that only has a #3 (Hold) rank, it should also have Scores of A or B to guarantee as much upside potential as possible.

Since the Scores were created to work together with the Zacks Rank, the direction of a stock's earnings estimate revisions should be a key factor when choosing which stocks to buy.

Here's an example: a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one with Style Scores of A and B, still has a downward-trending earnings outlook, and a bigger chance its share price will decrease too.

Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.

Stock to Watch: ConocoPhillips (COP - Free Report) Headquartered in Houston, TX, ConocoPhillips is primarily involved in the exploration and production of oil and natural gas. Considering proved reserves and production, the company is among the largest explorers and producers in the world. The company, founded in 1875, has a strong presence across conventional and unconventional plays in 13 countries. ConocoPhillips’ low-risk and cost-effective operations are spread across North America, Asia, Australia and Europe.

COP is a #3 (Hold) on the Zacks Rank, with a VGM Score of B.

Momentum investors should take note of this Oils-Energy stock. COP has a Momentum Style Score of A, and shares are up 2.9% over the past four weeks.

Five analysts revised their earnings estimate upwards in the last 60 days for fiscal 2026. The Zacks Consensus Estimate has increased $2.59 to $10.03 per share. COP boasts an average earnings surprise of +5.8%.

With a solid Zacks Rank and top-tier Momentum and VGM Style Scores, COP should be on investors' short list.

Oil prices tumbled in Tuesday trading, with Brent crude futures falling 3% and WTI down 3.5% as of 3:15 p.m. ET -- and both flavors of oil suffered even bigger losses earlier in the day.

Curiously, ConocoPhillips (COP +1.40%) stock didn't. This oil major started the day off with only about a 2% decline and remains down about 2.2%. Why?

Image source: Getty Images.

Is the Strait of Hormuz leaking oil? In an interview with CNBC this morning, U.S. Energy Secretary Chris Wright asserted that despite what you might have heard, oil shipments through the Strait of Hormuz are "rising very meaningfully" as U.S. Navy vessels coordinate with commercial captains to move their tankers safely through the contested waters. This goes against the accepted wisdom, but according to one recent JPMorgan report, oil shipments through the Strait may now be reaching 2 million barrels per day -- still a fraction of pre-war traffic, but significantly more than many investors were aware of.

And if these reports are true, it would imply that global oil supplies may not be as tight as we thought -- causing investors to worry about the durability of Conoco's profits.

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What it might mean for ConocoPhillips But are the reports true? And even if they are, will they stay true long enough to slake pent-up oil demand and allow prices to fall significantly? I have my doubts.

Continued tensions -- and missile fire! -- continue between Israel and Iran, and between U.S. naval forces and Iran as well. Repeated assurances from the President that a "deal" with Iran is just days away have been issued, then disappointed for weeks. On top of all this, there's the damage already done to oil infrastructure in Gulf oil states, which will take years to repair.

Seems to me, oil prices could stay high at least that long.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool recommends ConocoPhillips. The Motley Fool has a disclosure policy.

Key Takeaways BP says it has made 14 discoveries since early 2025, including Bumerangue at 8B barrels in place.COP's crude-heavy revenue mix and low-cost Permian, Eagle Ford and Bakken drilling could pay off for decades.XOM's upstream footprint spans the Permian and Guyana, positioning it to benefit from high oil prices. West Texas Intermediate (“WTI”) crude is trading at more than $85 per barrel. The high price is being backed by ongoing tensions in the Middle East. The U.S. Energy Information Administration (“EIA”) in its latest short-term energy outlook projected WTI at $88.32 per barrel this year, higher than $65.40 last year. A highly favorable pricing environment for the commodity is likely to continue supporting BP plc's (BP - Free Report) exploration and production activities, which generate a significant proportion of its earnings.

The British energy major’s production outlook seems bright, thanks to major discoveries. On its latest earnings call, BP mentioned that since the beginning of 2025, it has made 14 discoveries. BP said Bumerangue appears to be a very large oil discovery, estimated at around 8 billion barrels in place, though further appraisal work is needed to determine how much can actually be extracted and commercialized.

Given the prevailing high crude pricing environment and key discoveries, the British energy giant’s overall upstream business outlook, both in the near and long terms, seems highly encouraging. 

Will XOM & COP Also Gain From High Oil Prices?Like BP, Exxon Mobil Corporation (XOM - Free Report) and ConocoPhillips (COP - Free Report) will benefit from the ongoing strength in oil prices. Let’s delve a little deeper.

With COP generating a significant proportion of revenues from crude oil, the high price of the commodity is extremely favorable for the leading oil and gas exploration and production company, much like other energy giants such as XOM and BP.

The upstream energy giant also has low-cost drilling opportunities across Permian, Eagle Ford and Bakken that could be successfully developed over two decades. Thus, the outlook for ConocoPhillips’ upstream operations looks highly profitable.

To provide a glimpse of ExxonMobil’s upstream assets, the company has a massive footprint in the Permian, the most prolific oil and gas play in the United States, and offshore Guyana. Hence, XOM is also well-positioned to capitalize on the ongoing high commodity prices.

BP’s Price Performance, Valuation & EstimatesShares of BP have gained 38.9% over the past year, surpassing the industry’s 35.4% growth.

Image Source: Zacks Investment Research

From a valuation standpoint, BP trades at a trailing 12-month enterprise value to EBITDA (EV/EBITDA) of 3.20X. This is below the broader industry average of 6.40X.

Image Source: Zacks Investment Research

The Zacks Consensus Estimate for BP’s 2026 earnings has seen upward revisions over the past 30 days.

Image Source: Zacks Investment Research

BP currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

It doesn't matter your age or experience: taking full advantage of the stock market and investing with confidence are common goals for all investors. Luckily, Zacks Premium offers several different ways to do both.

The research service features daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, all of which will help you become a smarter, more confident investor.

It also includes access to the Zacks Style Scores.

What are the Zacks Style Scores? Developed alongside the Zacks Rank, the Zacks Style Scores are a group of complementary indicators that help investors pick stocks with the best chances of beating the market over the next 30 days.

Each stock is given an alphabetic rating of A, B, C, D or F based on their value, growth, and momentum qualities. With this system, an A is better than a B, a B is better than a C, and so on, meaning the better the score, the better chance the stock will outperform.

The Style Scores are broken down into four categories:

Value ScoreFinding good stocks at good prices, and discovering which companies are trading under their true value, are what value investors like to focus on. So, the Value Style Score takes into account ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and a host of other multiples to highlight the most attractive and discounted stocks.

Growth ScoreGrowth investors, on the other hand, are more concerned with a company's financial strength and health, and its future outlook. The Growth Style Score examines things like projected and historic earnings, sales, and cash flow to find stocks that will experience sustainable growth over time.

Momentum ScoreMomentum trading is all about taking advantage of upward or downward trends in a stock's price or earnings outlook, and these investors live by the saying "the trend is your friend." The Momentum Style Score can pinpoint good times to build a position in a stock, using factors like one-week price change and the monthly percentage change in earnings estimates.

VGM ScoreWhat if you like to use all three types of investing? The VGM Score is a combination of all Style Scores, making it one of the most comprehensive indicators to use with the Zacks Rank. It rates each stock on their combined weighted styles, which helps narrow down the companies with the most attractive value, best growth forecast, and most promising momentum.

How Style Scores Work with the Zacks Rank The Zacks Rank is a proprietary stock-rating model that harnesses the power of earnings estimate revisions, or changes to a company's earnings expectations, to help investors build a successful portfolio.

It's highly successful, with #1 (Strong Buy) stocks producing an unmatched +24% average annual return since 1988. That's more than double the S&P 500. But because of the large number of stocks we rate, there are over 200 companies with a Strong Buy rank, plus another 600 with a #2 (Buy) rank, on any given day.

This totals more than 800 top-rated stocks, and it can be overwhelming to try and pick the best stocks for you and your portfolio.

That's where the Style Scores come in.

You want to make sure you're buying stocks with the highest likelihood of success, and to do that, you'll need to pick stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you like a stock that only has a #3 (Hold) rank, it should also have Scores of A or B to guarantee as much upside potential as possible.

The direction of a stock's earnings estimate revisions should always be a key factor when choosing which stocks to buy, since the Scores were created to work together with the Zacks Rank.

Here's an example: a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one with Style Scores of A and B, still has a downward-trending earnings outlook, and a bigger chance its share price will decrease too.

Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.

Stock to Watch: ConocoPhillips (COP - Free Report) Headquartered in Houston, TX, ConocoPhillips is primarily involved in the exploration and production of oil and natural gas. Considering proved reserves and production, the company is among the largest explorers and producers in the world. The company, founded in 1875, has a strong presence across conventional and unconventional plays in 13 countries. ConocoPhillips’ low-risk and cost-effective operations are spread across North America, Asia, Australia and Europe.

COP is a #3 (Hold) on the Zacks Rank, with a VGM Score of B.

It also boasts a Value Style Score of A thanks to attractive valuation metrics like a forward P/E ratio of 11.5; value investors should take notice.

Eight analysts revised their earnings estimate upwards in the last 60 days for fiscal 2026. The Zacks Consensus Estimate has increased $2.57 to $10.03 per share. COP boasts an average earnings surprise of +5.8%.

With a solid Zacks Rank and top-tier Value and VGM Style Scores, COP should be on investors' short list.

, /PRNewswire/ -- Selvita S.A. (WSE: SLV), one of the leading Drug Discovery and Development organizations in Europe, has published its financial results for Q1 2026 and latest backlog. The Company has decided to launch a strategic options review for the Group's further development and to maximize long-term shareholder value.

The Group's operating revenues in Q1 amounted to EUR 19.1 million, at the upper end of the preliminary estimated results range of EUR 18.4-19.3 million. The EBITDA margin(1) reached 14%, compared to the estimated range of 13-16%. As a result of the cost-saving program implemented in H2 2025, operating costs in Q1 2026 were reduced by approximately EUR 1.5 million. Drug Development segment: Commercial revenues increased by 6% y/y in Q1 2026 to EUR 6.2 million, representing 35% of the Group's commercial revenues. Segment EBITDA amounted to EUR 1.7 million, up 2% y/y(1). Segment backlog increased 15% y/y supporting the Group's expectation of continued future growth driven by strategic alignment to fast-growing modalities. Drug Discovery segment: Commercial revenues in Q1 2026 amounted to EUR 11.6 million, compared to EUR 15.6 million in the prior year. Segment EBITDA(1) amounted to EUR 1.0 million, compared to EUR 1.9 million in Q1 2025.  This was primarily due to the continuing challenging market for outsourced European drug discovery services companies and some project delays. The full-year 2026 backlog as of May 18, 2026 stands at EUR 58.1 million(2) compared to EUR 58.9 million last year. A webcast to discuss Selvita's Q1 results and outlook for 2026 will be held on May 21 at 11:00 CET. The event will be available at live.selvita.com Selvita announced the launch of a strategic review to assess options to support the Group's further development and maximize shareholder value. Boguslaw Sieczkowski, Co-Founder, significant shareholder and Chief Executive Officer of Selvita said:

"We are observing a progressive recovery in the biotechnology sector, particularly in the United States. However, the market remains volatile, as reflected, amongst other factors, in our Q1 results. We are focusing our efforts on ensuring that the subsequent periods show clear improvement, reflecting the acceleration of growth in Drug Development and a stabilized performance in Drug Discovery. Our profitability is supported by the cost-saving program implemented in the second half of 2025.

"The Drug Development segment has grown by 20-25% in recent years and is now a key growth driver for the Group, already accounting for more than one-third of commercial revenues. We see potential for its further development and have identified specific pathways by which we can accelerate growth in this segment.

"The Drug Discovery segment continues its transformation, driven by ongoing structural changes in the outsourced European drug discovery services market. Last year, we optimized the segment's resources. We are currently focusing our efforts on more complex, high-margin services and increasing automation."

Dariusz Kurdas, Management Board Member and Chief Financial Officer of Selvita, said:

"With EUR 19.1 million in operating revenues and a 14% EBITDA margin, we came in the middle of the range of the Q1 preliminary estimates published earlier. In the Drug Discovery segment we observed some project delays. These projects are still expected in the remaining quarters of the year, supporting improved financial performance compared to Q1. This year, we expect an improvement in profitability thanks to the approximately EUR 6.4 million in savings under the optimization program."

STRATEGIC OPTIONS REVIEW

Selvita has continued to observe contrasting market dynamics across Drug Discovery and Drug Development.

In Drug Discovery, the European outsourced services market has remained challenging. However, the Group sees encouraging signs in the biotechnology funding environment and preliminary signs of increased levels of new pipeline opportunities which will support improved performance for the remainder of 2026 compared to Q1. Over the medium term, the Group expects continued headwinds in certain areas of small molecule Drug Discovery, whilst demand for high value-add and integrated services, especially for advanced modalities, is expected to continue to grow.

In Drug Development, the Group expects to see continued momentum in demand for services, notably in fast-growing advanced modalities.

In light of this market backdrop, Selvita has commenced a broad strategic review to assess options which would support the Group in achieving larger scale and maximizing long-term shareholder value.

The Group is considering, and is open to, a variety of strategic options, which may include a take private transaction, or an acceleration of Selvita's M&A and organic growth initiative capital deployment strategy. This includes scenarios where additional financing would be considered solely to support such value-accretive opportunities and incremental growth initiatives.

Selvita has not set a timetable for the review, nor has it made any decisions at this stage regarding the selection of or preference for any option. Updates on the conclusion of the strategic review will be publicly communicated by Selvita as and when appropriate, and in accordance with applicable regulations.

The strategic options review will be conducted with a strong focus on uninterrupted client service, operational stability, and continued excellence in project delivery.

To facilitate the strategic review, Selvita has engaged Rothschild & Co as financial adviser.

Boguslaw Sieczkowski said:

"It is our belief that the Drug Discovery and Drug Development markets are evolving to favour players of larger scale with broad geographic and service offering capabilities across modalities. We do not believe the Group's current valuation reflects its growth trajectory in Drug Development and unique capabilities and market positioning in Drug Discovery. We, therefore, think that now is an appropriate time to assess our potential strategic options. The underlying premise of the process is to improve the prospects of each of the Group's segments and deliver shareholder value."

Q1 2026 FINANCIAL RESULTS

Operating revenues in Q1 2026 amounted to EUR 19.1 million, compared to EUR 21.8 million in the prior year. The negative impact of foreign exchange differences on revenues amounted to approximately EUR 0.2 million.

Group EBITDA in Q1 2026 amounted to EUR 2.7 million, compared to EUR 3.6 million in the prior year(1). The EBITDA margin reached 14%. Savings resulting from the implemented optimization program amounted to approximately EUR 1.5 million.

Commercial revenues in the Drug Discovery segment in Q1 2026 amounted to EUR 11.6 million, compared to EUR 15.6 million in the prior year. Segment EBITDA(1) amounted to EUR 1.0 million, compared to EUR 1.9 million in the prior year.

Commercial revenues in the Drug Development segment in Q1 2026 amounted to EUR 6.2 million, up 6% y/y, already accounting for 35% of total commercial revenues. Segment EBITDA reached EUR 1.7 million, up 2% y/y, corresponding to a margin of 27%(1).

BACKLOG FOR 2026(2)

The Group's backlog for 2026 amounts to EUR 58.1 million compared to EUR 58.9 million in the same period last year.

The backlog in the Drug Discovery segment stands at EUR 35.3 million (down 13% y/y), while in the Drug Development segment it amounts to EUR 19.4 million (up 15% y/y).

DRUG DISCOVERY TECHNOLOGIES DEVELOPMENT PROGRAM FOR 2026-2029

In recent quarters, Selvita secured four non-dilutive grants with a combined subsidy value of EUR 26.4 million. Nearly half of this amount – EUR 12.0 million - will be invested in the development of advanced services in 2026-2029. Together, these projects represent the most intensive technology development program in the Group's history, spanning most departments within the Drug Discovery segment and incorporating a significant AI component.

The remaining portion of the grant funding will support infrastructure development, including the acquisition of state-of-the-art equipment and, in 2028-2029, the expansion of Selvita's own laboratory space in Kraków. The potential investment in new, specialized research facilities will be financed through a combination of grant funding (approx. 40%), bank debt (approx. 50%), and the Group's own funds (approx. 10%). In March 2026, Selvita signed a loan agreement securing financing for the investment. The largest share of capital expenditures is planned for the final phase of the investment, scheduled for 2029.

     (1) Results exclude non-cash costs of the non-dilutive employee incentive program.
     (2) Backlog as of May 18, 2026 and May 19, 2025; includes the revenues already invoiced in the financial year and portfolio of orders for the financial year.

All % calculated from PLN. All values are calculated from PLN using an average exchange rate for the respective reporting period.

About Selvita (WSE: SLV; sWIG80)

Selvita is one of the leading Drug Discovery and Development organizations in Europe. The Company provides comprehensive solutions supporting clients and their programs across a broad range of therapeutic areas, with expertise in infectious diseases, inflammation, fibrosis, and oncology. Selvita offers a wide range of standalone and fully integrated drug discovery and development solutions. Its service portfolio spans the entire value chain, from early-stage drug discovery to preclinical development, for both small molecules and therapeutic antibodies.

The Selvita Group has been operating since 2007 and employs approximately 900 highly qualified specialists. More than 30% of Selvita's scientists hold a PhD degree. The Group's headquarters and main laboratories are located in Kraków, Poland, with additional research facilities in Poznań, Wrocław, and Zagreb, Croatia. The Company's sales offices are located in major global biotech hubs, including the Boston and San Francisco Bay Areas in the United States, as well as Cambridge in the United Kingdom.

Selvita is listed on the Warsaw Stock Exchange (WSE: SLV) and is a component of the sWIG80 index.

For more information, please visit: www.selvita.com

SOURCE Selvita S.A.

Veeva Systems (VEEV - Free Report) reported $882.95 million in revenue for the quarter ended April 2026, representing a year-over-year increase of 16.3%. EPS of $2.24 for the same period compares to $1.97 a year ago.

The reported revenue represents a surprise of +2.99% over the Zacks Consensus Estimate of $857.33 million. With the consensus EPS estimate being $2.13, the EPS surprise was +5.1%.

While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations to determine their next course of action, some key metrics always provide a better insight into a company's underlying performance.

Since these metrics play a crucial role in driving the top- and bottom-line numbers, comparing them with the year-ago numbers and what analysts estimated about them helps investors better project a stock's price performance.

Here is how Veeva performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:

Non-GAAP Gross Margin- Professional services and other: 29.5% versus 27.7% estimated by seven analysts on average.Non-GAAP Gross Margin- Subscription services: 86.8% versus the seven-analyst average estimate of 87%.Revenues- Subscription services: $730.18 million versus $720.28 million estimated by seven analysts on average. Compared to the year-ago quarter, this number represents a +15% change.Revenues- Professional services and other: $152.77 million compared to the $137.05 million average estimate based on seven analysts. The reported number represents a change of +22.9% year over year.Revenues- Professional services and other- Veeva R&D Solutions: $95.2 million versus $88.58 million estimated by four analysts on average. Compared to the year-ago quarter, this number represents a +22.5% change.Revenues- Subscription services- Veeva R&D Solutions: $392.31 million versus the four-analyst average estimate of $386 million. The reported number represents a year-over-year change of +19.1%.Revenues- Subscription services- Veeva Commercial Solutions: $337.87 million compared to the $334.47 million average estimate based on four analysts. The reported number represents a change of +10.6% year over year.Revenues- Professional services and other- Veeva Commercial Solutions: $57.57 million versus the four-analyst average estimate of $48.72 million. The reported number represents a year-over-year change of +23.6%.View all Key Company Metrics for Veeva here>>>

Shares of Veeva have returned +6.9% over the past month versus the Zacks S&P 500 composite's +5.4% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term.

Veeva Systems Inc (VEEV) Q1 2027 Earnings Call Highlights: Surpassing Revenue Guidance and Unveiling AI Innovations Veeva Systems Inc (VEEV) reports strong revenue growth and introduces Veeva Falcon, an AI-driven product set to revolutionize drug development processes. Summary

Total Revenue: $883 million for the quarter.Non-GAAP Operating Income: $395 million.

Release Date: June 03, 2026

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points Veeva Systems Inc VEEV reported total revenue of $883 million for the quarter, surpassing their guidance.The company introduced Veeva Falcon, a disruptive AI-driven product aimed at automating labor-intensive tasks in drug development.Strong performance in the R&D and Quality Cloud segments, with significant growth potential in early-stage products like eCOA and RTSM.Crossix continues to show robust growth, driven by increased digital spending in the pharma industry and new innovations.The acquisition of Ostro is expected to contribute significantly to commercial subscription revenue, enhancing Veeva's digital engagement capabilities. Negative Points Despite a strong start to the year, Veeva Systems Inc (VEEV) only raised its full-year revenue guidance by $5 million, indicating potential conservatism or unforeseen challenges.The transition to AI applications in pharma is complex, and the full integration of AI into existing systems may take time.There is a risk of cannibalization of traditional SaaS revenue streams as AI-driven solutions like Falcon become more prevalent.The company faces competitive pressure in the CRM space, with ongoing migration decisions among top 20 pharma companies.Veeva Systems Inc (VEEV) is making significant investments in AI and other areas, which could impact short-term margins and profitability. Q & A Highlights Q: Can you expand on Veeva Falcon and its impact on drug development?
A: Peter Gassner, CEO, explained that Falcon represents a new chapter for Veeva, focusing on agentic labor to replace tasks traditionally done by people. Falcon operates at the agent layer, enabling applications to function headlessly. This innovation is disruptive as it introduces AI agents to perform specific tasks, enhancing efficiency in drug development.

Q: How is the pharma industry's appetite for AI applications evolving, and what areas are they focusing on first?
A: Peter Gassner noted that pharma companies are not just transitioning from traditional applications to AI but are adopting a new architecture involving models, agents, and applications. They aim to become agentic biopharmas, allowing AI agents to handle routine tasks, enabling humans to focus on higher-value work.

Q: Can you provide context on the R&D business's strong start and the conservative full-year guidance?
A: Brian Van Wagener, CFO, highlighted that while R&D showed strong growth in Q1, the full-year guidance reflects the early scaling of large products like eCOA and Safety. The business remains healthy, with significant growth potential.

Q: What is driving the strong performance and market share gains for Crossix?
A: Paul Shawah, EVP of Strategy, attributed Crossix's success to the growing digital market and increased pharma spending on digital channels. Crossix is innovating by measuring new channels, which drives market share gains and positions it for durable growth.

Q: How is Veeva pricing Falcon, and which labor roles are being targeted first?
A: Peter Gassner stated that Falcon will likely be priced per document or case, focusing initially on high-volume, repetitive tasks like processing clinical trial documents and safety case triage. These areas are ripe for automation and align with existing outsourcing practices.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].

Key Takeaways Veeva Systems topped Q1 estimates with revenue up 16.3% and adjusted EPS up 13.7%.VEEV raised fiscal 2027 revenue and adjusted EPS guidance above the consensus estimate.Veeva Systems expanded AI tools, added 27 Vault CRM customers and surpassed 150 live users. Veeva Systems, Inc. (VEEV - Free Report) reported adjusted earnings per share (EPS) of $2.24 for the first quarter of fiscal 2027, which increased 13.7% from the year-ago figure of $1.74. Adjusted EPS beat the Zacks Consensus Estimate by 5.2%.

GAAP EPS in the fiscal first quarter was $1.57, up 14.6% from the year-ago period’s $1.37.

VEEV’s Q1 Revenue DetailsIn the quarter under review, the company’s revenues totaled $882.9 million, beating the Zacks Consensus Estimate by 2.9%. On a year-over-year basis, the top line improved 16.3%.

However, shares of the company lost 5.2% in yesterday’s after-market trading. The stock lost 19.8% in the year-to-date period compared with the industry’s decline of 19.1%. However, the S&P 500 Index has increased 10.2% in the same time frame.

The fiscal first-quarter top line was driven by Veeva Systems’ robust segmental performance.

Image Source: Zacks Investment Research

Segmental Analysis of VEEVVeeva Systems derives revenues from two operating segments: Subscription services and Professional services and other.

In the fiscal first quarter, Subscription services revenues improved 15% from the year-ago quarter to $730.2 million. Per management, this uptick was driven by both its established and newer solutions.

Professional services and other revenues increased 22.9% year over year to $152.8 million.

Q1 Margin Performance by VEEVIn the quarter under review, Veeva Systems’ gross profit improved 13.1% year over year to $662 million. However, the gross margin contracted 220 basis points (bps) to 74.9%.

Sales and marketing expenses increased 12.7% year over year to $111.1 million. Research and development (R&D) expenses rose 13.2% year over year to $208.3 million, while general and administrative expenses increased 0.9% year over year to $69.5 million. Total operating expenses of $388.9 million increased 10.6% year over year.

Operating profit totaled $273.1 million, which increased 16.8% from the prior-year quarter. The operating margin in the fiscal first quarter expanded 20 bps to 30.9%.

VEEV’s Financial PositionThe company exited first-quarter fiscal 2027 with cash and cash equivalents and short-term investments of $7.31 billion compared with $6.56 billion at the fiscal fourth quarter of 2026-end.

Net cash provided by operating activities at the end of the quarter was $1.13 billion compared with $877.2 million a year ago.

Q2 & FY27 Guidance Provided by VEEVVeeva Systems has issued its financial outlook for the fiscal second quarter and fiscal 2027.

For the fiscal second quarter, the company expects total revenues between $902 million and $905 million. The Zacks Consensus Estimate is currently pegged at $886.8 million.

Subscription revenues are estimated to be approximately $754 million, and revenues for Professional services and other are expected to be in the range of $148-$151 million for the fiscal second quarter.

For the fiscal second quarter, adjusted EPS is anticipated to be between $2.21 and $2.22. The Zacks Consensus Estimate is pegged at $2.19.

Veeva Systems now expects revenues for fiscal 2027 between $3,635 million and $3,645 million. The Zacks Consensus Estimate is currently pegged at $3.59 billion.

For fiscal 2027, Subscription revenues are now expected to be approximately $3,060 million. This consists of Commercial Solutions’ subscription revenues of around $1,395 million and R&D Solutions’ subscription revenues of approximately $1,665 million.

Professional services and other revenues for fiscal 2027 are now expected to be between $575 million and $580 million.

Adjusted EPS for fiscal 2027 is now expected to be approximately $9.05. The Zacks Consensus Estimate is pegged at $8.86.

Our Take on Veeva Systems’ Q1 ResultsVeeva Systems exited the fiscal first quarter of 2027 with better-than-expected results, wherein both earnings and revenues beat the Zacks Consensus Estimate. The uptick in both top and bottom lines and robust performance by the Subscription services segment during the quarter were impressive. The uptick in Professional services and others’ revenues also bodes well.

Veeva Systems continues to strengthen its position in life sciences software through rapid innovation in artificial intelligence and expanding customer adoption. During the first quarter, the company significantly advanced its industry-specific AI strategy. Ostro, acquired in March, is now delivering compliant conversational AI for more than 50 brands, while Vault AI remains on track for deployment across all Vault applications in August.

Veeva Systems also introduced Falcon, its new platform designed to provide agentic labor across clinical, regulatory and safety functions, with an early adopter release expected in November. Management believes its deep integration within life sciences workflows and proprietary data assets uniquely positions the company to deliver compliant, high-value AI solutions that enhance productivity and decision-making.        

The company is also leading the transition toward Agentic Commercial. At its Commercial Summit, Veeva Systems outlined a vision for leveraging AI to help biopharma companies improve patient reach and commercial execution. New capabilities, including Agentic Call Report within Vault CRM and Ostro’s conversational AI solutions, are enabling customers to generate and act on commercial evidence more effectively. The adoption of Vault CRM remains strong, with 27 new customer additions during the quarter and more than 150 customers now live on the platform, reinforcing Veeva Systems’ growing leadership in next-generation commercial software.

Momentum across Veeva Development Cloud remains robust. The company secured multiple enterprise biopharma wins across clinical, regulatory and safety applications while generating strong customer interest in Vault AI and Falcon at its recent European R&D and Quality Summit. These solutions are expected to improve efficiency and accelerate drug development processes, further strengthening Veeva Systems’ competitive position within the life sciences industry.

VEEV’s Zacks Rank & Stocks to ConsiderVEEV carries a Zacks Rank #3 (Hold) at present.

Some better-ranked stocks from the broader medical space are Globus Medical (GMED - Free Report) , West Pharmaceutical (WST - Free Report) and Intuitive Surgical (ISRG - Free Report) .

Globus Medical, currently flaunting a Zacks Rank #1 (Strong Buy), reported a first-quarter 2026 adjusted earnings per share (EPS) of $1.12 per share, which surpassed the Zacks Consensus Estimate by 22.1%. Revenues of $759.9 million beat the Zacks Consensus Estimate by 4.0%. You can see the complete list of today’s Zacks #1 Rank stocks here.

GMED has an estimated long-term earnings growth rate of 10.2% compared with the industry’s 12.6% growth. The company’s earnings beat estimates in each of the trailing four quarters, the average surprise being 26.3%.

West Pharmaceutical, currently sporting a Zacks Rank #1, reported first-quarter 2026 EPS of $2.13, which beat the Zacks Consensus Estimate by 26.8%. Revenues of $844.9 million surpassed the Zacks Consensus Estimate by 8.5%.

WST has an estimated long-term earnings growth rate of 13.9% compared with the industry’s 9.5% growth. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 19.4%.

Intuitive Surgical, carrying a Zacks Rank #2 (Buy) at present, reported first-quarter 2026 adjusted EPS of $2.50, which beat the Zacks Consensus Estimate by 20.2%. Revenues of $2.77 billion surpassed the Zacks Consensus Estimate by 6.2%.

ISRG has a long-term estimated growth rate of 14.6% compared with the industry’s 12.6% growth. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 16.8%.

Key Takeaways Veeva Systems raised its FY27 revenue and EPS outlook after both metrics beat estimates in Q1.VEEV added 27 Vault CRM customers; win rate topped 80% this year, with more than 150 customers live.VEEV says that Falcon targets high-volume clinical and safety workflows; Ostro adds about $10M this year. Veeva Systems Inc. (VEEV - Free Report) used its first-quarter fiscal 2027 earnings call to frame a broader shift in strategy, arguing that its next growth phase will come from combining industry-specific software with AI agents rather than simply adding AI features to the existing products.

That message mattered as management also raised its full-year guidance after quarterly earnings and revenues both topped the Zacks Consensus Estimate, giving investors a stronger read on execution and on where Veeva Systems sees its biggest openings next.

VEEV Expands the Story Beyond SaaSChief executive officer Peter Gassner made the central point of the call clear: Veeva  Systems is moving from an industry-specific application company to an industry-specific application and AI agent company. Gassner described that as a major shift in how the company can serve life sciences customers.

Gassner said that the company is organizing its AI strategy around models, agents and applications, with Veeva Systems providing the application and agent layers for regulated life sciences work. In his framing, AI inside Vault can improve how people use software, while Falcon is designed to automate portions of work that have historically required human labor.

That emphasis gave the quarter a different tone from a standard software earnings call. The reported numbers were strong, with non-GAAP earnings of $2.24 per share beating the Zacks Consensus Estimate of $2.13. The company reported revenues of $882.95 million, which surpassed the consensus mark of $857.33 million. Also, management kept steering attention toward product architecture and long-term positioning.

Veeva Systems Lifts Full-Year TargetsChief financial officer Brian Van Wagener said that the fiscal first-quarter results exceeded guidance across all metrics, reflecting broad-based growth and profitability. Total revenues rose 16% year over year, while non-GAAP operating income climbed to $395.4 million from $349.9 million.

Management raised the fiscal 2027 revenue guidance to $3.635-$3.645 billion from its prior expectations, and projected $1.61 billion in non-GAAP operating income, with non-GAAP earnings per share of $9.05. For the fiscal second quarter, Veeva Systems expects revenues of $902 million to $905 million, and non-GAAP earnings per share of $2.21 to $2.22.

Van Wagener told Truist Securities that the macro environment looked essentially unchanged from a few months earlier. Wagener said the healthier outlook reflected continued solid demand across commercial, development and quality markets rather than any sharp improvement in external conditions.

VEEV Builds on CRM Migration WinsCommercial execution remained a key support for the story. Veeva Systems said that it added 27 Vault CRM customers in the quarter and now has more than 150 customers live on the platform.

In the Q&A, executive vice president of Strategy Paul Shawah said that recent wins with Teva and Merck KGaA were notable, though not part of the company’s fixed top-20 tracking list. Shawah said that Veeva Systems has won 10 of those large-account decisions so far compared with six for Salesforce, with four decisions left and expectations to win the majority of the remaining group.

That exchange stood out because analysts pressed management on whether prior expectations for top-20 outcomes were still intact. Shawah did not overreach, but he maintained a confident tone and backed it with an overall Vault CRM win rate above 80% this year and more than 40 migrations completed.

Veeva Systems Adds Ostro to AI MixAnother important strategic theme was the March acquisition of Ostro. Management positioned it as a compliant brand engagement platform that allows healthcare professionals and patients to ask questions and receive answers through biopharma digital properties.

Shawah told Needham that Ostro fits with Veeva Systems’ push into agentic commercial workflows and with what the company calls Commercial Evidence, or data gathered from real questions and interactions that can help biopharma clients identify barriers to getting medicines to patients.

Van Wagener said that Ostro should contribute about $10 million over the final three quarters of fiscal 2027, accounting for roughly two-thirds of the $15-million increase in the commercial subscription guidance. Wagener added that AI revenues outside Ostro should remain fairly immaterial this year.

VEEV Shows Where Falcon StartsFalcon drew the most detailed questioning from analysts and the clearest strategic responses from management. Gassner described it as Veeva Systems' first real move into digital labor, not as a toolkit for customers to build custom agents.

Gassner said that the earliest target areas are high-volume, standardized workflows such as clinical trial document intake, trial master file classification, safety case triage and regulatory correspondence. Those jobs are attractive because they are repetitive, rules-heavy and already often outsourced.

Management also offered early clues on monetization. Gassner said that Falcon will most likely be priced by document or by case, depending on the workflow, while stressing that the offering should be entirely additive because Veeva Systems does not currently sell that labor.

Veeva Systems Leaves a More Ambitious ToneThe call ended with a notably expansive posture. Gassner tied Falcon, Vault AI, Ostro and Veeva Basics into a broader effort to standardize more of life sciences work and then automate selected portions of it.

Van Wagener reinforced that tone by saying the company is still investing across Falcon, Vault AI, Ostro and its data network while preserving efficiency. The message coming out of the quarter was less about near-term margin maximization and more about building the next layer of the platform.

VEEV’s Zacks SignalsVeeva Systems currently carries a Zacks Rank #3 (Hold), with a Value Score of C, a Growth Score of B, a Momentum Score of F and a VGM Score of C. In Zacks terms, the rank points to a more balanced near-term outlook, while the style scores suggest the stock looks stronger on growth characteristics than on value or momentum. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Style Score framework gives the best read-through when paired with higher Zacks ranks, especially #1 and 2 (Buy) stocks with A or B style grades. The scorecard can still help frame trading style fit, but the Zacks Rank can change as earnings estimate revisions move after the quarter.

Veeva Systems (VEEV - Free Report) closed the last trading session at $172.61, gaining 3.8% over the past four weeks, but there could be plenty of upside left in the stock if short-term price targets set by Wall Street analysts are any guide. The mean price target of $244.88 indicates a 41.9% upside potential.

The average comprises 24 short-term price targets ranging from a low of $165.00 to a high of $340.00, with a standard deviation of $47.36. While the lowest estimate indicates a decline of 4.4% from the current price level, the most optimistic estimate points to a 97% upside. More than the range, one should note the standard deviation here, as it helps understand the variability of the estimates. The smaller the standard deviation, the greater the agreement among analysts.

While the consensus price target is highly sought after by investors, the ability and unbiasedness of analysts in setting price targets have long been questionable. And investors making investment decisions solely based on this tool would arguably do themselves a disservice.

But, for VEEV, an impressive average price target is not the only indicator of a potential upside. Strong agreement among analysts about the company's ability to report better earnings than they predicted earlier strengthens this view. While a positive trend in earnings estimate revisions doesn't gauge how much a stock could gain, it has proven to be powerful in predicting an upside.

Price, Consensus and EPS Surprise

Here's What You May Not Know About Analysts' Price TargetsAccording to researchers at several universities across the globe, a price target is one of many pieces of information about a stock that misleads investors far more often than it guides. In fact, empirical research shows that price targets set by several analysts, irrespective of the extent of agreement, rarely indicate where the price of a stock could actually be heading.

While Wall Street analysts have deep knowledge of a company's fundamentals and the sensitivity of its business to economic and industry issues, many of them tend to set overly optimistic price targets. Are you wondering why?

They usually do that to drum up interest in shares of companies that their firms either have existing business relationships with or are looking to be associated with. In other words, business incentives of firms covering a stock often result in inflated price targets set by analysts.

However, a tight clustering of price targets, which is represented by a low standard deviation, indicates that analysts have a high degree of agreement about the direction and magnitude of a stock's price movement. While that doesn't necessarily mean the stock will hit the average price target, it could be a good starting point for further research aimed at identifying the potential fundamental driving forces.

That said, while investors should not entirely ignore price targets, making an investment decision solely based on them could lead to disappointing ROI. So, price targets should always be treated with a high degree of skepticism.

Here's Why There Could be Plenty of Upside Left in VEEVAnalysts' growing optimism over the company's earnings prospects, as indicated by strong agreement among them in revising EPS estimates higher, could be a legitimate reason to expect an upside in the stock. That's because empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For the current year, one estimate has moved higher over the last 30 days compared to no negative revision. As a result, the Zacks Consensus Estimate has increased 0.9%.

Moreover, VEEV currently has a Zacks Rank #2 (Buy), which means it is in the top 20% of more than 4,000 stocks that we rank based on four factors related to earnings estimates. Given an impressive externally-audited track record, this is a more conclusive indication of the stock's potential upside in the near term. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>> .

Therefore, while the consensus price target may not be a reliable indicator of how much VEEV could gain, the direction of price movement it implies does appear to be a good guide.

End-to-end safety foundation to speed case processing and enable automation

, /PRNewswire/ -- Veeva Systems (NYSE: VEEV) today announced that UCB is unifying its global safety operations with Veeva Safety Suite to maximize operational efficiency and scale. UCB is standardizing safety on a single platform to accelerate case processing, strengthen oversight, and streamline submissions to health authorities.

"Moving our teams onto Veeva Safety Suite is a core step in UCB's safety transformation, helping streamline global and local workflows with a single source of truth for safety data," said Jonas Maselis, head of digital technology, patient safety, UCB. "As we use automation to drive low-touch case processing, our strategic partnership with Veeva positions us well for what's next."

UCB will use Veeva Safety Suite's unified platform for end-to-end safety management, with Veeva Safety to streamline the intake, processing, and submission of adverse events and Veeva SafetyDocs to manage all safety-related content and processes. Veeva Safety Workbench will enable advanced data analysis for fast, scalable reporting, and Veeva Safety Signal will automate signal detection for better visibility and alignment across the organization. In addition, the Veeva Safety-RIM Connection will share product information automatically across regulatory and safety operations for clean and trusted data.

"UCB is building a foundation powered by Veeva Safety Suite to simplify and standardize their global pharmacovigilance function," said John Lawrie, vice president, Veeva Safety. "With a unified and connected approach, UCB is enhancing global compliance and driving advanced automation to deliver safe and effective medicines to patients."

About Veeva Systems
Veeva delivers the industry cloud for life sciences with software, AI, data, and consulting. Committed to innovation, product excellence, and customer success, Veeva serves more than 1,500 customers, ranging from the world's largest pharmaceutical companies to emerging biotechs. As a Public Benefit Corporation, Veeva is committed to balancing the interests of all stakeholders, including customers, employees, shareholders, and the industries it serves. For more information, visit veeva.com.

Veeva Forward-Looking Statements
This release contains forward-looking statements regarding Veeva's products and services and the expected results or benefits from use of our products and services. These statements are based on our current expectations. Actual results could differ materially from those provided in this release and we have no obligation to update such statements. There are numerous risks that have the potential to negatively impact our results, including the risks and uncertainties disclosed in our filing on Form 10-Q for the fiscal year ended April 30, 2026, which you can find here (a summary of risks which may impact our business can be found on pages 33 and 34), and in our subsequent SEC filings, which you can access at sec.gov.

Contact:

Elizabeth McGrane
Veeva Systems
[email protected]

SOURCE Veeva Systems

Key Takeaways Veeva's Falcon targets high-volume clinical and safety workflows with agent-based automation.AI revenues are expected to be immaterial in fiscal 2027 as the focus stays on product quality.Vault AI expands embedded automation within apps, supporting adoption and retention. Veeva Systems Inc. (VEEV - Free Report) continues to benefit from demand for life sciences cloud platforms, with steady progress in Vault CRM migrations and ongoing expansion across R&D and Quality solutions. Management’s fiscal 2027 outlook calls for mid-teens revenue growth and a stable adjusted operating margin, assuming an unchanged macro environment.

The company’s AI roadmap adds an important long-term lever. However, the near-term math remains anchored to the subscription base, not a sudden AI-driven revenues step-up.

VEEV’s Falcon Targets High-Volume Workflow AutomationFalcon is positioned as an agent layer built to take on standardized, high-volume work, with early use cases centered on clinical document intake and safety case processing. That focus matters because those tasks sit at the heart of clinical, regulatory and safety workflows, where repetitive intake and routing can consume significant staff time.

Strategically, Falcon aims to create an automation layer that can scale across multiple functions as Veeva’s footprint broadens beyond its historical commercial roots into clinical development, safety and regulatory operations.

Veeva’s Pricing Models and Adoption SignalsMonetization is still developing. Management has discussed usage-aligned approaches, such as charging per document or per case, but pricing has not been finalized. In practical terms, that creates a wide range of possible outcomes for revenue timing and magnitude, even if the product value proposition is clear.

Falcon remains early, with the company still signing initial agreements and using customer data for quality control and training agents ahead of broader rollout. For investors, the adoption curve is the key variable to watch because early deployments in narrow workflows do not automatically translate into scaled, repeatable revenues.

Image Source: Zacks Investment Research

VEEV’s Vault AI Adds Embedded Use CasesAlongside Falcon, Veeva is scaling Vault AI inside its applications. The emphasis here is on embedded capabilities that automate labor-intensive processes within existing workflows, rather than a standalone agent layer that orchestrates tasks across systems.

Falcon is designed to tackle “agentic” labor in high-volume, standardized work, while Vault AI strengthens the day-to-day utility of the underlying apps customers already use. Over time, both can raise platform stickiness by reinforcing the value of an integrated ecosystem that spans clinical, safety, regulatory, quality and commercial functions.

Veeva’s Near-Term AI Revenues Look LimitedExpectations should stay grounded. Management expects AI revenue to be immaterial in fiscal 2027 outside of Ostro, with the current priority on product quality and customer success. That sequencing keeps near-term financial results tied primarily to execution in the core subscription portfolio.

The investor takeaway is that AI is best viewed as optionality rather than a near-term driver. The focus should be on whether Falcon and Vault AI meaningfully expand workflow value and adoption over time, instead of the amount of revenue generation in fiscal 2027.

Veeva’s Competitive and Execution Risks for AIExecution risk is real on multiple fronts. CRM decisions remain competitive, and Veeva also faces platform dependencies, including Salesforce for legacy Veeva CRM and Amazon Web Services for Vault-based applications. The prior agreement with Salesforce expired on Sept. 1, 2025, and includes seat-based limits for existing customers during a wind-down period through Sept. 1, 2030, adding complexity to the transition.

For Falcon specifically, uncertainty around the adoption pace and the timing of revenue contribution remains elevated because monetization is not finalized and the rollout is still in early agreements and training. Meanwhile, cost pressures have already weighed on profitability, with gross margin contracting 220 basis points year over year to 74.9% in the fiscal first quarter as infrastructure and services costs rose.

VEEV currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

VEEV’s Milestones to Track Through FY27Key milestones are practical and measurable. First is a finalized Falcon pricing approach and whether usage-aligned models (per document or per case) translate into repeatable customer agreements. Next is the number and depth of Falcon deployments beyond the initial clinical document and safety intake workflows, along with evidence of tangible workflow impact inside Safety and clinical operations.

On the embedded side, investors should watch Vault AI's expansion within core applications and whether it improves adoption and retention across the broader platform. Finally, track whether newer product lines such as RTSM, Safety and LIMS continue scaling while management sustains its fiscal 2027 expectation for a stable adjusted operating margin.

For context within the broader Medical Info Systems group, Enovis Corporation (ENOV - Free Report) carries a Zacks Rank #2, while Evolent Health, Inc (EVH - Free Report) has a Zacks Rank #3 (Hold). That mix underscores how stock performance in the space can diverge based on execution, making Veeva’s migration progress and AI delivery the focal points through fiscal 2027.

VEEV’s Sales & EPS PictureIn fiscal 2027, VEEV is expected to experience growth of 13.9% in revenues. On the profitability front, earnings per share are expected to improve 9.5% year over year.

Image Source: Zacks Investment Research

VEEV’s Valuation PictureVEEV currently trades at a price-to-book ratio of 3.79X, well below its industry’s current level of 6.24X.

Image Source: Zacks Investment Research

Taking full advantage of the stock market and investing with confidence are common goals for new and old investors, and Zacks Premium offers many different ways to do both.

The popular research service can help you become a smarter, more self-assured investor, giving you access to daily updates of the Zacks Rank and Zacks Industry Rank, the Zacks #1 Rank List, Equity Research reports, and Premium stock screens.

Zacks Premium also includes the Zacks Style Scores.

What are the Zacks Style Scores? Developed alongside the Zacks Rank, the Zacks Style Scores are a group of complementary indicators that help investors pick stocks with the best chances of beating the market over the next 30 days.

Each stock is assigned a rating of A, B, C, D, or F based on their value, growth, and momentum characteristics. Just like in school, an A is better than a B, a B is better than a C, and so on -- that means the better the score, the better chance the stock will outperform.

The Style Scores are broken down into four categories:

Value ScoreFinding good stocks at good prices, and discovering which companies are trading under their true value, are what value investors like to focus on. So, the Value Style Score takes into account ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and a host of other multiples to highlight the most attractive and discounted stocks.

Growth ScoreGrowth investors are more concerned with a stock's future prospects, and the overall financial health and strength of a company. Thus, the Growth Style Score analyzes characteristics like projected and historic earnings, sales, and cash flow to find stocks that will see sustainable growth over time.

Momentum ScoreMomentum investors, who live by the saying "the trend is your friend," are most interested in taking advantage of upward or downward trends in a stock's price or earnings outlook. Utilizing one-week price change and the monthly percentage change in earnings estimates, among other factors, the Momentum Style Score can help determine favorable times to buy high-momentum stocks.

VGM ScoreWhat if you like to use all three types of investing? The VGM Score is a combination of all Style Scores, making it one of the most comprehensive indicators to use with the Zacks Rank. It rates each stock on their combined weighted styles, which helps narrow down the companies with the most attractive value, best growth forecast, and most promising momentum.

How Style Scores Work with the Zacks Rank The Zacks Rank, which is a proprietary stock-rating model, employs earnings estimate revisions, or changes to a company's earnings expectations, to make building a winning portfolio easier.

#1 (Strong Buy) stocks have produced an unmatched +23.7% average annual return since 1988, which is more than double the S&P 500's performance over the same time frame. However, the Zacks Rank examines a ton of stocks, and there can be more than 200 companies with a Strong Buy rank, and another 600 with a #2 (Buy) rank, on any given day.

With more than 800 top-rated stocks to choose from, it can certainly feel overwhelming to pick the ones that are right for you and your investing journey.

That's where the Style Scores come in.

To have the best chance of big returns, you'll want to always consider stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B, which will give you the highest probability of success. If you're looking at stocks with a #3 (Hold) rank, it's important they have Scores of A or B as well to ensure as much upside potential as possible.

As mentioned above, the Scores are designed to work with the Zacks Rank, so any change to a company's earnings outlook should be a deciding factor when picking which stocks to buy.

Here's an example: a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one with Style Scores of A and B, still has a downward-trending earnings outlook, and a bigger chance its share price will decrease too.

Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.

Stock to Watch: Veeva Systems (VEEV - Free Report) Veeva Systems Inc. is headquartered in Pleasanton, CA and provides industry cloud solutions for the global life sciences market. Its offerings span cloud software, data, artificial intelligence capabilities and business consulting, supporting customers from research and development through commercialization. Veeva operates as a single reportable segment and groups revenues into Commercial Solutions and R&D and Quality Solutions. 

VEEV is a #2 (Buy) on the Zacks Rank, with a VGM Score of B.

Additionally, the company could be a top pick for growth investors. VEEV has a Growth Style Score of B, forecasting year-over-year earnings growth of 10.6% for the current fiscal year.

Five analysts revised their earnings estimate higher in the last 60 days for fiscal 2027, while the Zacks Consensus Estimate has increased $0.10 to $8.96 per share. VEEV also boasts an average earnings surprise of +5.5%.

With a solid Zacks Rank and top-tier Growth and VGM Style Scores, VEEV should be on investors' short list.

Veeva Systems (VEEV - Free Report) has been one of the most searched-for stocks on Zacks.com lately. So, you might want to look at some of the facts that could shape the stock's performance in the near term.

Shares of this provider of cloud-based software services for the life sciences industry have returned +5.2% over the past month versus the Zacks S&P 500 composite's -1.6% change. The Zacks Medical Info Systems industry, to which Veeva belongs, has gained 0.6% over this period. Now the key question is: Where could the stock be headed in the near term?

Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.

Earnings Estimate RevisionsRather than focusing on anything else, we at Zacks prioritize evaluating the change in a company's earnings projection. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings.

We essentially look at how sell-side analysts covering the stock are revising their earnings estimates to reflect the impact of the latest business trends. And if earnings estimates go up for a company, the fair value for its stock goes up. A higher fair value than the current market price drives investors' interest in buying the stock, leading to its price moving higher. This is why empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

Veeva is expected to post earnings of $2.22 per share for the current quarter, representing a year-over-year change of +11.6%. Over the last 30 days, the Zacks Consensus Estimate has changed +1.3%.

The consensus earnings estimate of $9.05 for the current fiscal year indicates a year-over-year change of +11.7%. This estimate has changed +3.7% over the last 30 days.

For the next fiscal year, the consensus earnings estimate of $9.9 indicates a change of +9.4% from what Veeva is expected to report a year ago. Over the past month, the estimate has changed +0.9%.

Having a strong externally audited track record, our proprietary stock rating tool, the Zacks Rank, offers a more conclusive picture of a stock's price direction in the near term, since it effectively harnesses the power of earnings estimate revisions. Due to the size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, Veeva is rated Zacks Rank #3 (Hold).

The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:

12 Month EPS

Revenue Growth ForecastEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.

In the case of Veeva, the consensus sales estimate of $904.07 million for the current quarter points to a year-over-year change of +14.6%. The $3.64 billion and $4.07 billion estimates for the current and next fiscal years indicate changes of +14% and +11.7%, respectively.

Last Reported Results and Surprise HistoryVeeva reported revenues of $882.95 million in the last reported quarter, representing a year-over-year change of +16.3%. EPS of $2.24 for the same period compares with $1.97 a year ago.

Compared to the Zacks Consensus Estimate of $857.33 million, the reported revenues represent a surprise of +2.99%. The EPS surprise was +5.16%.

The company beat consensus EPS estimates in each of the trailing four quarters. The company topped consensus revenue estimates each time over this period.

ValuationNo investment decision can be efficient without considering a stock's valuation. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance.

Comparing the current value of a company's valuation multiples, such as its price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), to its own historical values helps ascertain whether its stock is fairly valued, overvalued, or undervalued, whereas comparing the company relative to its peers on these parameters gives a good sense of how reasonable its stock price is.

As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B; B is better than C; and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.

Veeva is graded C on this front, indicating that it is trading at par with its peers. Click here to see the values of some of the valuation metrics that have driven this grade.

ConclusionThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Veeva. However, its Zacks Rank #3 does suggest that it may perform in line with the broader market in the near term.

While healthcare stocks have underperformed broader equities in recent years, there are still highly attractive companies in the sector worth consideration. However, other fairly popular healthcare players aren't worth investing in. Consider the following three healthcare stocks: Zoetis (ZTS 2.25%), BioNTech (BNTX +1.12%), and Intellia Therapeutics (NTLA 1.94%). The first two have lagged the market over the past year, while the last one has performed well. Even so, Zoetis and BioNTech are far more attractive stocks than Intellia Therapeutics for investors focused on the long game. Let me explain.

Image source: Getty Images.

A well-established animal health leader Let's start with Zoetis, a company that focuses on animal health. Over the past two years, it has faced some challenges, including increased competition for one of its core growth drivers -- Apoquel, a medicine for allergic itch in dogs -- as well as scrutiny over potential side effects for Solensia and Librela, which treat osteoarthritis (OA) pain in cats and dogs, respectively.

However, Zoetis should eventually bounce back. Even with stiffer competition for Apoquel, the company has a strong presence in this niche and estimates that millions of dogs remain untreated or undertreated.

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Meanwhile, it has earned approval for Portela and Lenivia, newer OA pain medicines for cats and dogs. These two also have the advantage of being long-acting options that can be administered every three months, compared to monthly for their predecessors.

These two should grab a decent share of the market. Meanwhile, in the long run, Zoetis should continue launching new products, as it has for a while, while capitalizing on increased spending on pets. Lastly, Zoetis is a fantastic dividend stock, having increased its payouts by 458% over the past decade, which makes it a top stock for income seekers.

An innovative biotech with a deep pipeline BioNTech hasn't performed well due to significant issues in the coronavirus vaccine market. Recent regulatory changes in the U.S. have made it harder for many people to get vaccinated. Even before that, this area was somewhat unpredictable.

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However, BioNTech is working on developing newer products. The company has a fairly impressive pipeline with more than 25 phase 2 or phase 3 clinical trials in oncology alone. Some of its candidates look particularly promising. Consider the company's BNT327, an investigational cancer medicine it is developing with Bristol Myers Squibb. This candidate is a bispecific antibody, a newer class of drugs. BioNTech believes BNT327 has the potential to set new standards of care across multiple indications.

Only time will tell if the biotech is right, but this and many other candidates are why the stock could bounce back and perform well over the next five years as it makes significant clinical and regulatory progress.

A high-risk gene editing specialist Intellia Therapeutics has made progress with its leading pipeline candidates over the past year. They include lonvo-z, a potential gene-editing medicine for hereditary angioedema -- a genetic disorder that causes painful episodes of swelling -- and nex-z, an investigational treatment for transthyretin amyloidosis, a rare condition in which abnormal protein clumps form around some organs, causing cardiovascular (and other) problems. Nex-z and lonvo-z are Both are undergoing phase 3 studies.

Nex-z hit a roadblock last year when regulators placed its clinical trials on hold due to suspected adverse reactions following the death of a patient. But the U.S. Food and Drug Administration lifted the hold, allowing Intellia to move forward.

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So, it seems like everything is going well for the biotech. However, it faces significant uncertainty. First, there is still the possibility that one -- or both -- of its late-stage assets will fail in ongoing studies. If that happens, the stock will fall off a cliff. Even if it doesn't, Intellia Therapeutics will face an uphill battle. Gene-editing treatments are expensive and difficult to administer. Between getting third-party payers on board and properly treating patients, it could be years before Intellia Therapeutics generates steady revenue from its products -- if it ever does. It will take even more time for the company to turn profitable. That's why the stock is very risky and not worth it for long-term investors right now.

Results from two early-stage trials offer new hope for a cancer that kills around one in eight patients within five years.

📌 Top story -- scroll down for more updates

Lockheed Drops 5% Despite War Demand 4:25 pm — LMT -4.62% today

Lockheed Martin (LMT 1.52%) posted Q1 earnings of $6.44 per share, missing estimates of $6.74, as heavy spending on production expansion and $1 billion in debt repayments weighed on results. Shares fell nearly 5% Thursday, though they’re up 6.6% year-to-date.

The cash burn explained: Free cash flow came in at negative $291 million, driven by production investments across 20+ facilities and $816 million in dividends—not deteriorating demand. Full year intact: Lockheed held its 2026 guidance: $29.35–$30.25 EPS and $6.5B–$6.8B in free cash flow, backed by a recent $4.7B Patriot interceptor contract. Metric (GAAP unless noted)Q1 2026 (12 weeks)Q1 2025 (13 weeks)Y/YEPS$6.44$7.28(11.5%)Revenue (billions)$18.0$18.00%Operating Margin, Aeronautics (Non-GAAP)8.9%10.2%(1.3 pp)Operating Margin, Missiles and Fire Control (Non-GAAP)13.7%13.8%(0.1 pp)Free Cash Flow (Non-GAAP, millions)($291)$955-130.5% Closing Bell 4:07 pm

Stocks closed lower Thursday as rising Middle East tensions pushed oil to its fourth straight gain. Brent crude climbed 3.1% to $105.07 a barrel on stalled U.S.-Iran diplomacy and threats in the Strait of Hormuz. The Nasdaq fell 0.9%; the S&P 500 and Dow each dropped 0.4%.

ServiceNow Takes the Biggest Hit: Shares of ServiceNow (NOW 0.71%) plunged 18% despite revenue growth — investors punished the company for trimming its projected operating margin. Microsoft (MSFT +0.11%) fell 4% in sympathy. IBM and Tesla Also Disappoint: IBM (IBM 1.13%) dropped 8.3% after holding revenue guidance flat. Tesla (TSLA +1.82%) shed 3.6% after announcing $25 billion in planned capital expenditures tied to AI and robotics. FDA Approves Regeneron’s Historic Hearing Cure 3:52 pm — REGN +2.64%

It’s a big day for Regeneron Pharmaceuticals (REGN +0.11%). The FDA approved Otarmeni, Regeneron’s gene therapy for children born deaf due to a rare genetic mutation, making it the first-ever gene therapy to restore hearing. In clinical trials, it improved hearing in 11 of 12 children. In an unusual move, Regeneron is offering the drug free in the U.S., a striking contrast to the million-dollar price tags common in gene therapy.

Free of charge, unprecedented: The condition affects just 20 to 50 U.S. newborns annually, but Regeneron aims to expand the drug's reach if further studies succeed. “We don’t feel like we have to figure out how to maximally price this so that we can try to make a windfall,” said George Yancopoulos, Regeneron’s co-founder and chief scientific officer. Same-day Fool rec: Regeneron is recommended in Motley Fool Health AI, the Fool's newest real-money portfolio, which was launched today. The buy report highlighted Regeneron’s genetic medicines pipeline and $5.9 billion R&D commitment; today’s approval is exactly the kind of pipeline payoff that thesis was built on.

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Nvidia Partners With Nuclear Startup Oklo 3:33 pm — NVDA -1.71%, OKLO +6.22%

Because apparently ruling the chip world wasn’t enough, Nvidia (NVDA +0.15%) is teaming up with nuclear startup Oklo (OKLO 0.64%) and the Los Alamos National Laboratory to use AI to advance nuclear research.

Not just vibes: The trio will develop AI models to validate nuclear fuel and study power generation for nuclear-powered AI factories—real, substantive work with serious infrastructure implications. "The company also shows significant strength in its technology, marked by substantial R&D investments, key project advancements, and strategic partnerships that position it competitively within the advanced nuclear sector," according to the Moneyball Hidden Gems primary database. The bull case for Oklo: HSBC (HSBC +2.15%) slapped a buy rating and $96 price target on Oklo stock, but investors should note Oklo has no meaningful revenue yet and needs regulatory approval before any of this becomes real. "Makes no sense for this stock to be gaining as it is. And yet it continues," member SoLongGoodbye wrote recently. Right now the stock remains essentially a bet on a future that hasn't arrived yet; a lot of optimism is already baked in.

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Meta Axes 8K Jobs, Kills 6K Openings 2:58 pm — META -2.50%

Mark Zuckerberg isn’t done swinging the axe. Meta (META 0.14%) is cutting 10% of its workforce — about 8,000 jobs — and canceling 6,000 open roles it had planned to fill. Layoffs begin May 20. It’s the latest in a string of cuts at Meta, which has been shedding metaverse-era headcount while pivoting hard toward AI. Microsoft (MSFT +0.11%) apparently got the memo too, announcing its first-ever voluntary buyout program Thursday for roughly 7% of its U.S. workforce.

Zuck’s AI Gap: Meta has openly trailed OpenAI, Alphabet (GOOG +0.44%), and Anthropic in generative AI — and Zuckerberg seems willing to spend (and cut) whatever it takes to close it. Big Tech’s New Math: Amazon (AMZN 1.24%) cut 16,000 jobs in January. The calculus is simple: fewer humans, more GPUs.

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Texas Instruments Beats, Raises Guidance 2:30 pm — TXN +17.68%

By Seth Jayson
Team Rule Breakers

Texas Instruments (TXN +1.35%) beat on earnings and raised guidance, so the stock did what stocks do and jumped. Nothing shocking about that. The real story is whether they can actually pull off integrating Silicon Labs without tripping over themselves, and whether industrial demand holds up or rolls over next quarter. Management seems buttoned up and the cash generation is real.

Nice beat from a company that some people haven’t thought about since the 1980s…

Today's Lunchtime News 1:15 pm — SBUX +0.5%

Starbucks (SBUX +0.74%) is seeing early signs that last month's loyalty program overhaul is pulling in value-conscious customers, CNBC reports. Loyalty transactions accounted for 60% of the coffee chain's fiscal 2025 revenue, making the Rewards program central to CEO Brian Niccol's broader turnaround push.

Early traction: The new 60-star redemption option has become the program's most popular reward, with more than a quarter of all redemptions opting for the $2 discount. The first "free Mod Monday" more than doubled point redemptions versus earlier Mondays this year, and reusable cup usage for double-star bonuses jumped by double digits. Earnings on deck: Starbucks reports fiscal second-quarter results after the bell next Tuesday, with management expected to share more on loyalty trends and the broader turnaround. The chain's traffic struggles have been tied to losing active Rewards members, so any signs of a rebound there will be a key watch item. SBUX performance

Today +0.5%

1 Year +20.7%

5 Years -15.0%

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ServiceNow's AI Wins Can't Calm the Street 1:25 pm — NOW -18.6%

By Matt Frankel, CFP®
Team Hidden Gems

ServiceNow (NOW 0.71%) beat its own guidance on revenue, earnings, and subscription growth, yet a Middle East-driven deal slowdown and looming margin pressure from its security acquisitions overshadowed the quarter. Revenue climbed 22% year-over-year to $3.67 billion and non-GAAP earnings per share rose 19.8% to $0.97. Adoption of its AI workflow tool Now Assist accelerated sharply, as the number of customers spending over $1 million on the product grew 130% year-over-year.

Delayed on-premises deal closings in the Middle East trimmed roughly 75 basis points off subscription growth, which management attributed to the ongoing Iran conflict. It also warned that integration costs from the Armis and Veza security acquisitions will weigh on margins until fiscal 2027. Those headwinds offset a $205 million bump to full-year subscription revenue guidance.

Shares are down roughly 17% in Thursday mid-day trading near $86.

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IBM Beats on Q1, but Consulting Stalls 12:20 pm — IBM -8.8%

By Matt Frankel, CFP®
Team Hidden Gems

International Business Machines (IBM 1.13%) beat expectations on both revenue and earnings, yet the market punished it for unchanged guidance and weakness in its consulting arm. Revenue grew 9% year-over-year to $15.9 billion and non-GAAP earnings per share jumped 19% to $1.91, ahead of Wall Street forecasts on both lines. The biggest upside surprise came from infrastructure, where a 51% surge in IBM Z mainframe sales helped segment profit more than double.

Software, the company's largest revenue contributor, grew 11% year-over-year on hybrid cloud and AI demand, and operating margins expanded to 29.8%. Consulting, however, grew only 1% in constant currency. That matters because the segment houses most of IBM's $12.5 billion generative AI book, where investors are most worried about AI-native competitors eating into IBM's advisory work. Despite the strong Q1 showing, management reaffirmed its full-year outlook for more than 5% constant-currency revenue growth and a roughly $1 billion free cash flow increase.

Shares are down about 9% in Thursday trading near $228.

Microsoft Cuts 7% of U.S. Workforce 12:10 pm — MSFT -3.3%

Microsoft (MSFT +0.11%) is launching its first-ever voluntary buyout program, targeting approximately 7% of its U.S. workforce as it aggressively reallocates resources toward artificial intelligence. The 51-year-old titan will offer retirement packages to senior directors and below whose age and tenure total at least 70. This strategic thinning comes as Microsoft, Alphabet (GOOG +0.44%), and Amazon (AMZN 1.24%) face immense capital expenditure requirements for data centers while disruptive coding AI threatens legacy software margins. To retain top talent amid this transition, Microsoft is also decoupling stock awards from cash bonuses, granting managers more flexibility to reward elite performers.

Streamlined Incentives: The move to five pay options instead of nine simplifies the annual review process, allowing the company to pivot compensation toward AI-critical roles. Fiscal Prudence: By opting for voluntary exits over forced layoffs, Microsoft aims to reduce its 228,000-person headcount while maintaining internal morale during a volatile period for software valuations. ServiceNow Plunges on War Headwinds 11:15 am — NOW -16.1%

ServiceNow (NOW 0.71%) shares plummeted 17% Thursday morning, dragging down peers like Salesforce (CRM 0.23%), Adobe (ADBE 6.75%), and Oracle (ORCL 0.05%). While the company matched first-quarter earnings estimates at $0.97 per share, management revealed that the ongoing conflict in Iran delayed several large on-premise deals. This geopolitical friction created a 75-basis-point headwind for subscription revenue, which grew 22% to $3.67 billion. Investors reacted sharply to the news, as the software sector already faces heightened scrutiny regarding its ability to maintain growth rates while navigating both global instability and the rapid transition toward generative artificial intelligence.

Collateral Damage Discovered: The sales slowdown at ServiceNow sparked a contagion effect across the industry, with Salesforce shedding 8% as traders price in similar international deal delays. AI Valuation Pressure: Despite strong headline numbers, software giants are being punished for any sign of weakness as the market weighs if AI will eventually commoditize core enterprise platforms. Paramount Triumphs in WBD Bidding War 11:10 am — PSKY -5.1%

Warner Bros. Discovery (WBD +0.37%) shareholders overwhelmingly approved a $31-per-share acquisition by Paramount Skydance (PSKY 0.19%) on Thursday, moving the blockbuster media merger toward a third-quarter close. The deal follows an intense bidding war involving Netflix (NFLX 1.20%) and Comcast (CMCSA +2.21%). Paramount's offer includes a $7 billion breakup fee and covers WBD's previous $2.8 billion penalty to Netflix. While the premium offers certainty in a volatile streaming landscape, investors expressed frustration over non-binding executive payouts. CEO David Zaslav is set to receive an $800 million "golden parachute," including a controversial $335 million tax gross-up, despite a formal shareholder vote rejecting the compensation package.

Strategic Consolidation Play: By folding HBO Max, CNN, and the Warner Bros. film studio into its portfolio, Paramount aims to build a "next-generation" scale capable of rivaling Disney (DIS 0.43%) in global streaming dominance. Regulatory Hurdles Remain: While investors and proxy firms like ISS are on board, the merger still requires federal sign-off, which could be complicated by the consolidation of major news and sports broadcasting assets. WBD performance

Today -0.2%

1 Year +227.4%

5 Years -29.0%

Hidden Gems Primary
Database Superscore

51

Top of the Morning 10:25 am — ISRG flat

By Sanmeet Deo
Team Rule Breakers

Intuitive Surgical (ISRG 0.50%) dropped its Q1 2026 results on April 21, and the numbers were hard to argue with. Revenue hit $2.77 billion, up 23% year over year, while non-GAAP earnings per share surged to $2.50, crushing estimates of $2.12. Procedures grew 17% globally, the Ion lung-biopsy platform jumped 39%, and management promptly raised full-year guidance. For good measure, the company bought back $1.1 billion of its own stock in a single quarter, the largest repurchase in company history.

The bull case is compelling. The most important detail in the report wasn't the topline beat, it was that revenue grew six percentage points faster than procedures. That gap is pricing power made visible, driven by the da Vinci 5 platform commanding higher ASPs and generating ~11% more utilization per system than its predecessor. As the installed base of 11,395 systems churns out high-margin instrument and accessory revenue every quarter, the flywheel keeps spinning faster. Japan's new reimbursement policy in June 2026 could add another growth leg.

The bear case has teeth too. China, once a promising growth frontier, is now effectively dead money until at least 2027, with domestic competition and policy headwinds showing no signs of abating. Tariffs are trimming roughly 100 basis points from gross margins. And a newly disclosed cybersecurity incident involving unauthorized customer data access introduces a tail risk management hasn't faced before.

At its current valuation, Intuitive already prices in a lot of perfection. The business is exceptional, the question is whether the stock gives you room to breathe.

Today's Change

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-2.05

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410.85

9:25 am — MEDP -23.2% in pre-market trading

By Andy Cross
Motley Fool CIO

Medpace (MEDP 1.77%) shares are under pressure today after reporting Q1 2026 earnings yesterday that exceeded estimates but left investors concerned over future business. Q1 EPS of $4.28 beat the $3.94 estimates. And revenue of $706.6 million outpaced expectations of $697.6 million. The contract research company also maintained its full-year 2026 guidance with revenues between $2.755 billion and $2.855 billion and EPS between $16.68 and $17.50.

The conference call is just going on as I write this, but some of the concerns are about the book-to-bill ratio, which dipped down to 0.88x from 1.04x last quarter and 0.9x a year ago. Book-to-bill measures future business relative to the current sales. Above 1 is better than not. Medpace's ratio this quarter was also below analysts' consensus estimate of 1.04x according to VisibleAlpha, a S&P GlobalMarket Intelligence company. And that estimate has trended down. So this 0.88x result comes as a bit of a surprise.

5:15 am — BNTX -0.69% in pre-market trading

By Morning Show host Thomas King, CFA
Team Rule Breakers

Pancreatic cancer is one of the deadliest. In 2019 and 2020, sixteen patients were treated with a cancer vaccine developed by BioNTech (BNTX +1.12%) and Genentech which was designed to stimulate their immune system to recognize and attack the cancerous cells. Of the sixteen patients treated, eight had a significant immune system response, and of these eight, seven were alive five years after receiving the vaccine. Seven of the total of sixteen patients (44%), and seven of the eight (88%) that had an immune response were alive five years later. This is a dramatic improvement from the typical five-year survival rate for pancreatic cancer, which is 13%. This was a small study with only sixteen patients, but the results are encouraging and the vaccine will now be tested in a larger group of patients in a Phase 2 study.

Opening Bell 9:35 am -- TSLA -2.6%, IBM -9.6%, NOW -15.9%

Wall Street is pulling back from Wednesday's record peaks as heavy-hitting tech earnings trigger a selective sell-off. While the S&P 500 and Nasdaq initially rallied on President Trump’s Iran ceasefire extension, disappointing reactions to corporate results have soured the mood. Tesla (TSLA +1.82%) shares reversed early gains to trade 3% lower after CEO Elon Musk projected a "substantial" surge in capital expenditures — hitting $25 billion for 2026 — to fund its shift into AI and robotics. Meanwhile, enterprise software giants IBM (IBM 1.13%) and ServiceNow (NOW 0.71%) are dragging on the indices, dropping 7% and 13% respectively, as investors question if current profit growth can sustain premium valuations amid ongoing geopolitical "heartburn."

Market indexes

S&P 500

-0.26%

Nasdaq

-0.43%

Dow

-0.45%

Netflix's $25B Buyback Signals Share Confidence 8:00 am -- NFLX +1.22% in pre-market trading

Netflix (NFLX 1.20%) is shifting its capital strategy from mega-mergers to shareholder returns, authorizing a new $25 billion share repurchase program following its exit from the $72 billion race for Warner Bros. Discovery (WBD +0.37%). The move comes as the streamer sits on $12.3 billion in cash--boosted by a $2.8 billion breakup fee from Paramount Skydance (PSKY 0.19%)--and looks to soothe investors following a tepid Q2 forecast and the impending departure of co-founder Reed Hastings. With acquisition "noise" behind it, Netflix is pivoting toward internal growth, including the recent purchase of AI film-tech firm InterPositive and a $20 billion content spend targeting live sports and advertising scale.

High-Yield Confidence: The buyback resumes with $6.8 billion still remaining from a previous 2024 plan, signaling management's belief that shares are undervalued after a recent 10% post-earnings dip to roughly $94. Scaling the Ad Tier: Analysts expect the ad-supported segment to double revenue to $3 billion in 2026, serving as a critical offset to slowing subscriber growth in mature markets like the U.S. and Canada.

Today's Change

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-1.20

%) $

-0.97

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80.30

This Morning's Breakfast News 7:30 am -- IBM -7.48% in pre-market trading

IBM (IBM 1.13%) fell over 7% ahead of the market open despite quarterly results beating revenue and earnings estimates, as cautious guidance for the full year weighed on sentiment, something CEO Arvind Krishna blamed on broader geopolitical uncertainty.

"A lot of consumer companies are my clients": Krishna pointed out that higher inflation could see people spend less at companies such as Walmart (WMT +0.44%), which indirectly impacts IBM from reduced activity. "IBM's consulting business will be both threatened and supported by more sophisticated AI tools": In late February, TMF chief investment officer Andy Cross explained the Hidden Gems recommendation is under pressure from AI disruption, but "mainframes remain necessary infrastructure for hugely complex computing systems."

ICYMI: Wednesday's Scoreboard 6:00 am -- AOS unchanged in pre-market trading

A.O. Smith (AOS +0.72%) was the subject of the latest Scoreboard video.

China's Tech Giants Race to Back DeepSeek 5:30 am -- BABA -2.34% in pre-market trading

Chinese internet giants Tencent (TCEHY 0.20%) and Alibaba (BABA +0.02%) are in advanced talks to lead a landmark $300 million funding round for DeepSeek, a move that could value the AI pioneer at over $20 billion. The start-up, owned by hedge fund High-Flyer Capital Management, has gained global recognition for its high-efficiency, low-cost open-source models that rival U.S. leaders like Alphabet (GOOG +0.44%). Tencent has reportedly proposed acquiring up to a 20% stake, though negotiations remain fluid as DeepSeek resists ceding significant control. For the tech titans, the deal is a strategic grab for "agentic AI" leadership and a way to lock in demand for their respective cloud computing and data center services.

Benchmark Battle: DeepSeek's target valuation is being compared to MiniMax, another Chinese "super unicorn" recently valued by Goldman Sachs at $38.9 billion due to its extreme optimization of computing costs. Agentic Shift: DeepSeek is pivotally expanding into software "agents" capable of autonomous task execution, a sector where Alibaba recently consolidated its AI services into a single business unit to drive 2026 growth.

Today's Change

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0.02

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0.02

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112.71

Tilray Jumps on Cannabis Rescheduling Hopes 4:45 am -- TLRY +2.50% in pre-market trading

Tilray (TLRY 2.73%) shares surged over 11% as cannabis stocks rallied following reports that the Trump administration is expected to move toward reclassifying marijuana to Schedule III. The potential regulatory shift has sparked heavy buying interest across the sector.

Rescheduling catalyst drives sector rally: Reports indicate the administration is expected to finalize marijuana reclassification, which investors view as a major regulatory catalyst that could ease tax burdens and boost the industry. Analyst sees significant upside potential: A Wall Street analyst highlighted over 40% upside for Tilray based on its leading Canadian market share and growing beverage revenue, adding to the bullish sentiment surrounding the stock.

Today's Change

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4.98

Before the Opening Bell 4:30 am

Stock futures retreated Thursday as a breakdown in U.S.-Iran negotiations overshadowed President Trump's "indefinite" ceasefire. While the truce holds, a complete naval blockade of the Strait of Hormuz has pushed Brent crude back above $103 per barrel, fueling stagflation fears ahead of April's manufacturing data. Tesla (TSLA +1.82%) added to the volatility; despite a Q1 earnings beat, shares fell 2% after CEO Elon Musk jacked up 2026 capital expenditure guidance to $25 billion to fund a massive "Cybercab" and AI robotics push. As cash flow concerns mount, investors are pivoting to pre-market results from American Express (AXP +2.18%), Blackstone (BX +1.58%), and American Airlines (AAL +2.25%) to gauge consumer and industrial resilience.

The $25B Bet: Tesla's tripled capex run-rate targets six simultaneous production lines, including a dedicated "Optimus" humanoid robot facility in Austin set to begin large-scale output this August. Banking on the Premium: American Express is expected to post a 10% earnings jump to $4.01 per share, as its high-net-worth customer base remains largely insulated from war-related energy spikes. HSBC Holdings is an advertising partner of Motley Fool Money. American Express is an advertising partner of Motley Fool Money. This article was created using Large Language Models (LLMs) based on The Motley Fool's insights and investing approach. It has been reviewed by our AI quality control systems. Since LLMs cannot (currently) own stocks, it has no positions in any of the stocks mentioned. Andy Cross has positions in Adobe, Alphabet, Amazon, Comcast, Mastercard, Medpace, Meta Platforms, Microsoft, Netflix, Nvidia, Salesforce, ServiceNow, Starbucks, Tesla, Walt Disney, and Warner Bros. Discovery. Sanmeet Deo, CFA has positions in Alphabet, Amazon, Intuitive Surgical, Medpace, Netflix, Tesla, and Walmart. Seth Jayson has positions in A. O. Smith, Amazon, Microsoft, Nvidia, Salesforce, ServiceNow, and Walt Disney. Thomas King, CFA has positions in Adobe, Alphabet, Amazon, BioNTech Se, Intuitive Surgical, Mastercard, Microsoft, Salesforce, Tesla, Texas Instruments, and Walt Disney. The Motley Fool has positions in and recommends A. O. Smith, Adobe, Alphabet, Amazon, Blackstone, DoorDash, International Business Machines, Intuitive Surgical, Mastercard, Medpace, Meta Platforms, Microsoft, Netflix, Nvidia, Oracle, Regeneron Pharmaceuticals, Salesforce, ServiceNow, Starbucks, Tencent, Tesla, Texas Instruments, Walmart, Walt Disney, and Warner Bros. Discovery. The Motley Fool recommends Alibaba Group, BioNTech Se, Comcast, HSBC Holdings, Lockheed Martin, and Tilray Brands and recommends the following options: long January 2028 $330 calls on Adobe, long January 2028 $520 calls on Intuitive Surgical, short January 2028 $340 calls on Adobe, and short January 2028 $530 calls on Intuitive Surgical. The Motley Fool has a disclosure policy.

The logo of BioNTech is pictured at Biontech's research laboratory for individualised vaccines against cancer in Mainz, Germany, July 27, 2023. REUTERS/Wolfgang Rattay/File Photo Purchase Licensing Rights, opens new tab

SummaryCompaniesBioNTech transfers COVID-19 vaccine production to PfizerCutbacks come after co-founders announced departures to start new ventureCompany plans $1 billion share buyback, cost cuts, reaffirms R&D budgetShares fall 6.1%FRANKFURT, May 5 (Reuters) - BioNTech (22UAy.DE), opens new tab said on ‌Tuesday it would close sites affecting up to 1,860 jobs and buy back up to $1 billion worth of its shares, as the COVID‑19 vaccine maker pivots away from pandemic-era manufacturing and prepares for a leadership transition.

The German company, which reported on ​Tuesday that it fell further into the red in the first quarter, said it would close ​sites in Idar-Oberstein, Marburg and Tuebingen, Germany, as well as in Singapore. The closures ⁠are part of a production transfer of its COVID-19 vaccine to partner Pfizer (PFE.N), opens new tab this year.

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BioNTech shares were down ​6.1% after its results and announcement of plant closures.

BioNTech, the initial inventor of the Western world's most commonly ​used immunisation shot during the pandemic, said in March that its two co-founders would leave by the end of this year to start a new venture.

After years of deals and hiring for a deeper development pipeline and a commercial build-up, CEO Ugur ​Sahin and Chief Medical Officer Oezlem Tuereci, the married couple behind the success, said at the time they ​would strike out on their own to pursue early drug research.

The exit from Idar-Oberstein, Marburg, and Tuebingen is planned by ‌the ⁠end of 2027, while operations in Singapore are expected to end during the first quarter of 2027, the statement said.

For each site, BioNTech is exploring options including a partial or total sale, it added.

It acquired operations in Tuebingen as part of the takeover of domestic peer CureVac for about $1.25 billion, agreed in June last year.

BioNTech ​also said it would ​ramp up cost-cutting, potentially ⁠reaching about 500 million euros ($584.50 million) in annual savings in 2029.

Based on BioNTech's staff of about 8,400, about 22% would be affected by job cuts, predominantly in ​Germany.

In March last year, BioNTech unveiled plans to cut between 950 and 1,350 positions ​until 2027 and ⁠it was not immediately clear how many jobs have already been cut.

The company, which had 16.7 billion euros in cash and financial securities as of March 31, will also repurchase up to $1 billion of its shares over the ⁠next ​12 months.

It reported a first-quarter net loss of 532 million euros, ​compared with a loss of 416 million in the year-earlier period.

The group reaffirmed a 2026 research and development budget of 2.2 billion to ​2.5 billion euros.

($1 = 0.8554 euros)

Reporting by Patricia Weiss and Ludwig Burger, editing by Linda Pasquini and Susan Fenton

Our Standards: The Thomson Reuters Trust Principles., opens new tab