This week's actionable picks include a staffing compounder sitting at a 48% DCF discount with estimate revisions moving higher, a profitable software company reporting at 5x forward earnings with a 60% gap to analyst targets, and a southeastern community bank trading at nearly half its estimated fair value.
Read on before the print closes the window on the clearest near-term setup.
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Software Infrastructure
Elastic Cuts 7% of Staff for AI, While an $83 Buy Case Stays Alive
Elastic N.V. (NYSE: ESTC) trades around $56.39 after announcing a 7% workforce reduction tied to AI automation, faster decision-making, and a leaner operating structure. The company expects $22 million to $25 million in mostly severance-related cash charges, but the bigger question is whether this is a warning sign or the start of a cleaner AI-era cost base.
The valuation tension is what makes it interesting. A fresh Buy rating still carries an $83 target, leaving Elastic about 32% below that mark even after today’s bounce. That is not a typical PE story because GAAP earnings remain messy. It is a target-gap and cash-flow story.
Fiscal Q4 revenue rose 16% to $451 million, remaining performance obligations climbed 28%, and adjusted free cash flow reached $150 million. You are not getting a smooth software story here. You are getting a mid-cap infrastructure name, trying to prove the AI reset is more than just layoffs with better branding.
AI Layoffs Put the Business Model on Trial
Elastic is cutting staff while still planning to grow headcount in customer-facing roles this year. That makes the move less about retreat and more about shifting resources toward the parts of the business that can still scale.
Free Cash Flow Gives the Reset Some Weight
A restructuring story needs numbers to back it up. Elastic has them. The $150 million in adjusted free cash flow gives the cost-cutting plan a stronger base than a simple expense-reduction headline.
Consumer
Nike’s 11-Year Low Turns June 30 Earnings Into a Turnaround Test
Nike Inc. (NYSE: NKE) trades around $41.16, with the stock hovering near an 11-year low ahead of its June 30 earnings report. The pressure is not just about one weak quarter. Investors are questioning whether the brand reset, China recovery, and wholesale repair plan can arrive fast enough to stop the slide.
Current estimates call for roughly $10.9 billion in revenue and an adjusted profit decline of about 8%. That makes the next report less of a normal earnings date and more of a credibility check for the turnaround.
The valuation gap is still hard to ignore. Market data indicate an average price target near $60, while the stock trades near $41. You are not buying Nike at its best here. You are buying it while the market treats a world-class brand as if its comeback is still stuck in the locker room.
June 30 Has to Show the Reset Is Real
Nike needs more than cost discipline. It needs evidence that product momentum, wholesale relationships, and China demand are moving in the right direction before investors give the turnaround more credit.
A $60 Target Keeps the Upside Debate Open
A low stock price does not make Nike cheap by itself. The gap matters because the brand still has scale, distribution, and pricing power if the reset starts showing up in the numbers.
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Retail
Casey’s 400-Store Plan Gets Sold After a Huge Run, but the $939 Target Still Hangs There
Casey’s General Stores Inc. (NASDAQ: CASY) trades around $765 after the market gave its new three-year plan a cold read. The stock has already had a monster year, so investors were not in the mood to reward another long-term growth slide deck without asking what is already priced in.
The plan itself is not weak. Casey’s is targeting 8% to 10% annual EBITDA growth from fiscal 2027 through fiscal 2029, while adding at least 400 stores through new builds and smaller acquisitions. That gives the company a clear expansion path in convenience retail, prepared food, and fuel.
A cheap multiple is not the valuation case. The real question is whether the selloff went too far for a business still carrying a $939 average target. You now have a strong operator being marked down because expectations have finally caught up with the stock.
400 Stores Give the Growth Plan Real Shape
Casey’s does not depend on one product line or one lucky quarter. Store growth, foodservice, private brand, and fuel margins all give the company more than one way to keep EBITDA moving.
A $939 Target Keeps the Pullback Interesting
A hot stock can still get ahead of itself. The question now is whether a roughly 18% gap to the average target leaves enough room for the market to forgive the investor-day reset.
Actionable Picks This Week
Robert Half (NYSE: RHI)
Robert Half is a staffing and professional services company trading at around $35 against a DCF fair value near $60, a discount of roughly 40%. The staffing cycle has been brutal over the past 18 months, and the stock has absorbed most of that pain, which is exactly when scaling into early-cycle positions tends to work.
Estimate revisions have been moving higher over the past six weeks as enterprise hiring data stabilizes, and management bought back stock through the trough rather than waiting for the recovery to confirm itself.
You are not catching a falling knife here — you are paying for a position ahead of when the improvement shows up in headline EPS. The risk is that the hiring recovery takes longer than the revision trend suggests, and the EPS improvement gets pushed further out.
Progress Software (NASDAQ: PRGS)
Progress Software reports fiscal Q2 2026 on June 30 after the close with consensus EPS of $1.49 on $242.74 million in revenue, both up from the year-ago period.
The company guided Q2 non-GAAP EPS of $1.47 to $1.53 when reporting Q1 in March, which beat consensus by $0.03. This is a profitable, recurring-revenue software business with a forward PE of roughly 5x against a five-year average of 11x — that spread is the valuation case in a single line.
Management uses free cash flow to buy back stock and fund tuck-in acquisitions. The average analyst target of $50.83 against a current price of around $27 to $30 implies over 60% upside. The risk is that recent insider selling and multiple target reductions reflect a genuine growth deceleration that the current beat-and-raise cadence is temporarily masking.
FB Financial (NYSE: FBK)
FB Financial is a southeastern US community bank trading around $55 against a fair value estimate near $101, a gap the market has not yet closed.
Net interest margin is expanding as deposit costs roll over and higher-yielding loan portfolios reprice upward, and the southeastern US market provides structural loan growth tailwinds that slower-growth regions do not. Q2 earnings in mid-July are the catalyst where margin expansion commentary is expected to make the case more visible.
The risk is that if rate cuts arrive sooner than expected under the Warsh Fed path, the repricing tailwind compresses faster than volume growth can replace it.
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Fast Movers to Watch
National Vision Holdings (NASDAQ: EYE)’s executive bought 50,000 shares on the open market in early June when optical retail was deeply out of favor — the kind of inside signal that matters more than any analyst note, given how quiet the stock has been.
Q1 showed the loss narrowing meaningfully year over year, and operations appear to be stabilizing, even if the headline numbers have not yet turned clean. Q2 is the print to watch for confirmation that stabilization is real and not a single-quarter outlier.BlackSky Technology (NYSE: BKSY) is a geospatial intelligence and satellite imaging company with a DCF fair value near $68 against a current price of around $25, roughly a 65% discount, in a sector where defense budgets are pulling forward globally.
Revenue has been growing, and the contract pipeline is active, but this is a smaller and less liquid name that requires patience and smaller position sizing than the core picks. The upside is real if the defense contract expansion continues as guided.
Gogo (NASDAQ: GOGO) runs in-flight connectivity for business aviation at a price around $3, a deep discount to DCF fair value based on several analyst models, as the business aviation broadband market remains structurally underpenetrated.
Recent analyst commentary noted the recovery in business aviation connectivity spending and the company’s positioning in a market with very few direct competitors at scale. Q2 will be the next data point on whether the recovery trend is holding and accelerating.
One of history's greatest value investments came from buying shares of a company that virtually everyone on Wall Street had written off as finished. What company did David Tepper of Appaloosa Management bet on in 2009 — when most assumed it would be natio
Everything Else
Three small-cap stocks across AI, energy, and emerging tech are quietly showing the same early structural shifts that precede the biggest moves.
The Federal Reserve under Kevin Warsh held its benchmark rate steady at 3.5% to 3.75%, but nine of 18 dot plot members now project at least one rate hike by the end of 2026, sending bond yields higher and complicating the rate-cut narrative.
CRH announced an $8.5 billion all-cash acquisition of Arcosa at $150 per share, a 10% premium, expanding its infrastructure and aggregates platform across North America.
Intel surged more than 10% to an all-time high of $135.32 after President Trump announced Apple had agreed to partner with Intel to design and manufacture chips in the United States, marking Intel’s largest external foundry win.
Digital Realty announced approximately $1.6 billion in acquisitions, including 1,440 acres near Kansas City for hyperscale data center development and an increased stake in Teraco, Africa’s leading data center platform, to 77%.
That's our coverage for today; thanks for reading! Reply to this email with feedback or any [blank] stocks you want me to check out.
Best Regards,
—Noah Zelvis
Undervalued Edge
