Deutsche Bank Shines as Bull of the Day Amid Market Shifts
Chicago, IL – May 5, 2025 – Zacks Equity Research identifies Deutsche Bank (DB) as the Bull of the Day, while Caesars Entertainment (CZR) garners the Bear of the Day title. Additional insights are provided on Advanced Micro Devices (AMD), Dell Technologies (DELL), and Meta Platforms (META).
Here is a synopsis of all five stocks:
Deutsche Bank: A Bullish Outlook
Amid increasing optimism about European equities, Deutsche Bank’s stock has been added to the Zacks Rank #1 (Strong Buy) list. The Zacks Banks-Foreign Industry stands in the top 4% of over 240 Zacks industries. Deutsche Bank’s American Depositary Receipt (ADR) has performed well this year, gaining over 50% in 2025, while broader indexes adjust following a correction in U.S. markets.
Currently trading at 52-week highs of $26 a share, there remains potential for further growth. This comes amid a favorable trend in earnings estimate revisions.
Positive Sentiment Toward European Markets
Corporate earnings in Europe are projected to be robust, as noted by Goldman Sachs (GS). Factors such as increased defense spending serve as significant catalysts. Reports indicate a notable trend of global investors reallocating away from U.S. equities to increase their stake in European markets.
Deutsche Bank analysts have adopted a positive view on other European equities, citing improved market conditions and decreased geopolitical tensions. The European Union (EU) faces challenges, including potential tariffs from Washington; however, its major trade partnerships remain within Europe.
Financial Projections for Deutsche Bank
As a major player in global finance, Deutsche Bank’s steady growth is attracting investor interest. As Germany’s largest bank, total sales are projected to rise by 7% in fiscal 2025 and are expected to increase another 2% in FY26 to reach $35.39 billion.
Notably, annual earnings forecasts indicate a significant increase of 116% this year, targeting $3.20 per share, compared to $1.48 per share in 2024. Projections for FY26 suggest an 11% uptick in earnings.
Earnings Estimate Revisions Show Growth
Deutsche Bank’s rally is supported by increasing earnings estimate revisions. FY25 EPS estimates have climbed 9% in the past 60 days, representing a 23% increase from the previous year. Similarly, FY26 EPS estimates saw a 14% rise in just two months, with a 26% increase year over year.
Summary and Investor Insights
Deutsche Bank’s selection as the Bull of the Day does not imply a complete pivot away from U.S. equities. However, with shares trading at 8X forward earnings and less than 1X sales, its rally may have further room for growth.
Investors should consider diversification as a strategy against economic uncertainties, and Deutsche Bank merits attention beyond well-known U.S. banks. As U.S. markets exit correction territory, consumer sentiment has notably declined, impacting segments like Leisure and Recreation.
Caesars Entertainment: A Challenging Outlook
In contrast, Caesars Entertainment’s stock has been given a Zacks Rank #5 (Strong Sell). This comes as the company faces challenges following a disappointing earnings report. Caesars reported a wider-than-expected adjusted loss of -$0.54 a share, against an anticipated loss of -$0.19, despite Q1 revenues of $2.79 billion exceeding expectations of $2.78 billion. The company has missed expectations in three out of its last four quarterly reports, raising concerns among investors.
Stock Performance Decline
Year to date, Caesars Entertainment’s stock has dropped 17%, underperforming the S&P 500’s decline of 5% and lagging behind the Zacks Leisure & Recreation Services Market’s decline of 13%. Over the past three years, shares have plummeted more than 50%.
Declining Earnings Estimates
Caesars faces additional downside risk, as earnings estimate revisions have consistently fallen since the recent Q1 report. Over the last quarter, fiscal 2025 EPS estimates have decreased by 70%, dropping from $1.25 per share to $0.37. Although FY26 estimates initially appeared promising, they have also fallen sharply—40%—from $2.17 a share to $1.28 over the last three months.
Final Considerations
Given its struggling stock performance and declining earnings estimates, it would be prudent for investors to steer clear of Caesars Entertainment for the time being. The consumer discretionary sector is likely to feel the effects of economic uncertainty, with diminishing demand for non-essential recreational activities.
Preview: Advanced Micro Devices Q1 Earnings
Advanced Micro Devices is scheduled to report its first-quarter 2025 results on May 6. AMD anticipates Q1 revenues of $7.1 billion (+/- $300 million), representing year-over-year growth of approximately 30% but a sequential decline of about 7%.
The Zacks Consensus Estimate for AMD’s first-quarter revenues is set at $7.12 billion.
# AMD’s Upcoming Earnings: Insights into Growth and Challenges Ahead
AMD’s upcoming earnings report indicates a strong year-over-year growth outlook of 30.11%. The consensus estimate for first-quarter earnings stands at 93 cents per share, which has remained unchanged over the last 30 days. This earnings forecast represents a 50% increase compared to the same period last year.
Over the past four quarters, AMD has consistently exceeded the Zacks Consensus Estimate for earnings, with an average surprise of 2.32%. This strong performance underscores the company’s potential as it approaches the latest earnings announcement.
Expectations for Revenue Growth in Data Center & Client Segments
AMD anticipates significant growth in both its data center and client segments for the first quarter. This expected rise is driven mainly by the ongoing demand for its EPYC processors and Ryzen chips. In particular, the data center segment is projected to be a key driver of success, with expectations of sustained momentum in this area.
The Zacks Consensus Estimate forecasts first-quarter revenues for the Data Center segment at $3.4 billion, reflecting a remarkable year-over-year increase of 47.5%. Strong sales of data center chips that support hyperscale operations and AI applications are the primary catalysts for this growth.
The client segment is also expected to show solid performance, bolstered by rising demand for Ryzen processors across desktop and mobile platforms. Collaborations, such as the partnership with Dell Technologies for Ryzen Pro processors in commercial PCs, are anticipated to contribute positively to this segment’s performance. The expected revenues for the Client segment are pegged at $2.04 billion, marking a 49.3% increase year-over-year.
Challenges in Embedded and Gaming Segments
Despite the positive projections for its core segments, AMD faces challenges from weaker performances in its Embedded and Gaming divisions. Revenues in these areas are predicted to show a decline compared to the previous year.
For the first quarter, the Zacks Consensus Estimate for Embedded revenues is $570 million, indicating a modest 0.9% decline year-over-year. Meanwhile, Gaming revenues are expected to reach $509 million, representing a significant drop of 38.1% compared to last year.
AMD Stock Performance and Valuation Concerns
In 2023, Advanced Micro Devices shares have decreased by 17.9%, underperforming the Zacks Computer and Technology sector, which has seen a decline of 9%, and the Zacks Computer – Integrated Systems industry’s drop of 7.2%.
Currently, AMD’s stock is viewed as overvalued according to its Value Score of F. In terms of the forward 12-month price-to-sales ratio, AMD trades at 4.68, which is substantially higher than the Computer – Integrated Systems industry’s average of 2.90.
Strategic Partnerships Enhancing Growth Potential
AMD benefits from a robust partner network that includes major players such as Microsoft, Oracle, Dell Technologies, Hewlett Packard, Lenovo, Meta Platforms, and IBM, all of which have integrated Instinct platforms into their production lines.
The demand for AI accelerators like the Instinct MI300 series is expected to grow, particularly from hyperscalers, driving further data center revenue growth heading into the first quarter of 2025. Notably, cloud partners like Meta Platforms, Microsoft, IBM, Digital Ocean, and Dell Technologies have increased their deployment of MI300X.
Meta Platforms has utilized MI300X to power its Llama 405B frontier model on meta.ai, integrating instinct GPUs into its OCP-compliant Grand Teton platform for deep learning applications. Similarly, Microsoft deploys MI300X for its GPT-4-based Copilot services, while IBM is set to enable MI300X on its Watson X AI platform for enterprise-ready generative applications. Dell Technologies is offering MI300X within its AI factory solution suite, enhancing its ready-to-deploy options.
Conclusion
AMD’s diverse portfolio and ongoing strategic partnerships are poised to enhance top-line growth, despite facing headwinds in the Embedded and Gaming segments and stiff competition from NVIDIA.
With a Growth Score of C, AMD appears less attractive to growth-focused investors, and its stretched valuation remains a concern. Currently, AMD holds a Zacks Rank #3 (Hold), suggesting that it may be prudent for investors to wait for a more opportune moment to consider acquiring the stock.
# Detailed Investment Insights: Stock Performance and Analysis
Zacks Investment Research maintains a distinct separation from activities such as investment banking, market making, and asset management. The financial data shared in this article derives from hypothetical portfolios of stocks rated Zacks Rank = 1, which have been rebalanced monthly without transaction costs. It is important to note that these returns do not reflect actual portfolios. Additionally, the S&P 500 serves as an unmanaged index for reference.
Exclusive Access to Zacks Portfolio Insights
For just $1, Zacks offers a unique opportunity for new members to access a month of portfolio picks. There is no obligation to invest further. This initiative aims to familiarize users with Zacks’ suite of services, including Surprise Trader, Stocks Under $10, and Technology Innovators, which collectively closed 256 positions with double- and triple-digit gains in 2024.
Latest Stock Recommendations Available
Interested in the latest investment suggestions from Zacks? Currently, they are offering the report titled “7 Best Stocks for the Next 30 Days” for free. This report can serve as a resource for those looking to enhance their investment strategies.
Stock Analysis Reports
Zacks also offers complimentary stock analysis reports for the following companies:
- Advanced Micro Devices, Inc. (AMD)
- Deutsche Bank Aktiengesellschaft (DB)
- Dell Technologies Inc. (DELL)
- Caesars Entertainment, Inc. (CZR)
- Meta Platforms, Inc. (META)
These reports provide detailed insights into the respective companies’ performances and market outlooks.
*The views expressed in this article represent the author’s opinions and may not reflect those of Nasdaq, Inc.*
