In this edition, we uncover hidden SaaS profits; we see who is the top dog in animal health moats; and AI exuberance has overripened Apple's valuation; and Scor, Bilibili, and Target.

Management's ability to "raise guidance" can often be a catalyst for market-beating returns for specific stocks in the quarters ahead. The third-quarter earnings season is wrapping up, with blended earnings (actual results and the consensus for those still to report) showing a year-over-year gain of 9%, according to Refinitiv. Leading the outperformance were strong gains in Communication Services earnings, up 26%. On the flipside, Energy is performing the worst, down 25%. Our analysts are always on the lookout for companies that boost their outlooks during earnings season. The following is a partial list of companies at which management raised guidance during the 3Q24 EPS reporting season. All are BUY-rated in the Argus Fundamental Universe of Coverage. We like this theme, as it crosses numerous industries and generates a robust list of potential portfolio candidates.

Pfizer is one of the world's largest pharmaceutical firms, with annual sales close to $50 billion (excluding covid-19-related product sales). While it historically sold many types of healthcare products and chemicals, now prescription drugs and vaccines account for the majority of sales. Top sellers include pneumococcal vaccine Prevnar 13, cancer drug Ibrance, and cardiovascular treatment Eliquis. Pfizer sells these products globally, with international sales representing close to 50% of total sales. Within international sales, emerging markets are a major contributor.

This pick list highlights constituents of the Morningstar US Large Cap Index that we believe offer investors the best risk-adjusted return prospects. Stocks of large-cap companies where neither growth nor value characteristics predominate. Stocks in the top 70% of the capitalization of the U.S. equity market are defined as large cap.