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Top Analyst Reports for Amazon, Procter & Gamble & Chevron

Mark Vickery
Top Analyst Reports for Amazon, Procter & Gamble & Chevron

Monday, April 29, 2019

The Zacks Research Daily presents the best research output of our analyst team. Today's Research Daily features new research reports on 16 major stocks, including Amazon (AMZN), Procter & Gamble (PG) and Chevron (CVX). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.

You can see all of today’s research reports here >>>

Amazon’s shares have outperformed the broader market in the past year (the stock is up +24.5% vs. the +10.8% increase for the S&P 500 as a whole). The Zacks analyst thinks Amazon continues to ride on its ecommerce dominance. Its aggressive retail strategies, distribution strength and robust Prime remain key catalysts.

Moreover, rapid adoption of Prime owing to its customer benefits and strengthening grocery services is driving its top-line growth. Further, the company’s growing brick and mortar presence is a tailwind. Additionally, Amazon’s continued momentum in AWS remains a major positive. Increasing AWS regions and its growing adoption will continue to aid Amazon’s cloud dominance.

However, first-quarter 2019 revenue guidance remains disappointing. Further, rising cloud competition from the likes of Microsoft Azure and Google cloud is a significant headwind. Also, heavy investment in fulfillment centers is a concern.

(You can read the full research report on Amazon here >>>).

Shares of Procter & Gamble outperformed the Zacks Soap and Cleaning Materials industry in the past year, gaining +46.4% vs. +25.7%. The Zacks analyst thinks that this can be attributed to the company’s impressive earnings history. It delivered 16th straight earnings beat in third-quarter fiscal 2019, with sixth sales beat in last seven quarters.

While earnings benefited from its ongoing productivity efforts, strong organic growth with higher shipment volumes and favorable price/mix led to sales growth. Furthermore, management raised its sales guidance for fiscal 2019 and reaffirmed the earnings outlook. The company’s focus on product improvement, packaging and marketing initiatives, and productivity and cost-savings plan too bode well.

However, Procter & Gamble has been witnessing strained margins owing to increased commodity and shipping costs, higher brand investments amid intense competition. Also, adverse foreign currency rates are hurting the company’s top and bottom lines, which may continue in fiscal 2019 as well.

(You can read the full research report on Procter & Gamble here >>>).

Buy-ranked Chevron’s shares have outperformed the Zacks Integrated Oil industry in the past six months (+5.6% vs. -0.9%). Chevron's Q1 earnings were ahead of analysts' expectations, while upstream production exceeded 3 million barrels per day for the second successive quarter.

The Zacks analyst thinks Chevron’s existing oil and gas development project pipeline is among the best in the industry, targeting volume growth of around 4-7% in 2019 thanks to planned expansion in the Permian Basin. Chevron pumped 55% more out of the West Texas shale play in the quarter compared with the same period last year, with production set to soar in coming years.

The company's recently announced $50 billion Anadarko acquisition looks compelling given the access to potentially lucrative Permian Basin acreage, LNG operations in Mozambique, as well as attractive deepwater infrastructure in the GoM. Additionally, the buyout is expected to improve Chevron’s cash flow profile. Therefore, Chevron is a preferred supermajor to own now.

(You can read the full research report on Chevron here >>>).

Other noteworthy reports we are featuring today include United Parcel Service (UPS), General Dynamics (GD) and Raytheon (RTN).

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Mark Vickery
Senior Editor

Note: Sheraz Mian heads the Zacks Equity Research department and is a well-regarded expert of aggregate earnings. He is frequently quoted in the print and electronic media and publishes the weekly Earnings Trends and Earnings Preview reports. If you want an email notification each time Sheraz publishes a new article, please click here>>>

Today's Must Read

Amazon (AMZN) Rides on Prime & AWS Amid Rising Competition

P&G's (PG) Productivity & Cost Savings Plan to Drive Profits

Chevron (CVX) to Gain from Permian Production, Anadarko Buy

Featured Reports

UPS Aided by E-commerce, Dividends, Buybacks Amid Cost Woes

Robust e-commerce growth is a positive for UPS. Efforts to reward shareholders are encouraging too. High operating expenses, however, raise concerns.

Product Innovations, Acquisitions Aids General Dynamics (GD)

Per the Zacks analyst, General Dynamics' focus on product innovations and strategic acquisitions should help the company in maintaining steady growth momentum and drive results in the quarters ahead.

Order Growth to Aid Raytheon (RTN), Raw Material Costs Ail

Per the Zacks analyst, a smooth order flow from Pentagon and its foreign allies boost Raytheon's revenue growth prospects. Yet, rising raw material costs can weigh on its bottom line.

Biogen's (BIIB) Spinraza Uptake Strong Amid Soft MS Sales

Biogen's newest drug Spinraza is performing well amid slowing trends in the multiple sclerosis market. Biogen is in-licensing assets some of which have transformative potential per the Zacks analyst.

Content Strength, Pandora Acquisition Aid Sirius XM (SIRI)

Per the Zacks analyst, Sirius XM is benefiting from strong content slate that drives subscriber growth and average revenue per user (ARPU) and the Pandora acquisition that adds to its top line.

Core Oncology Systems Arm Aids Varian (VAR), Margins Stressed

The Zacks analyst is apprehensive about the company's dented margins.

Focus on Trading Business Aids E*TRADE (ETFC), Costs a Woe

Per the Zacks analyst, E*TRADE's efforts to enhance trading business through new brokerage products and services might support its growth.

New Upgrades

Rising Top line, Inorganic Growth Aid Marsh & McLennan (MMC)

Per the Zacks analyst, strategic inorganic growth initiatives such as the buyouts of JLT Group and Bouchard Insurance have resulted in solid revenues, which in turn poise it well for growth.

TE Connectivity (TEL) Rides on Robust Industrial Solutions

Per the Zacks analyst, TE Connectivity's solid momentum across the aerospace, defense and medical applications domains is aiding the adoption rate of its industrial solutions.

Construction Materials Segment & Buyouts Aid Carlisle (CSL)

Per the Zacks analyst, strong Construction Materials segment driven by strength in North American non-residential construction markets and acquisitions like Petersen will lend momentum to Carlisle.

New Downgrades

Weak Demand Environment, China Headwinds Hurt Waters (WAT)

Per the Zacks analyst, Waters is suffering from sluggish customer spending in pharmaceutical and industrial markets. Further, macro-economic headwinds in China remain a concern.

Citrix (CTXS) Hurt by Increasing Investments & High Debt

Per the Zacks analyst, Citrix Systems' growing investments aimed at retaining competitive cost position are likely to limit margin expansion. Further, its leveraged balance sheet is a persistent woe.

Escalating Expenses, High Debt Hurt Alliance Data (ADS)

Per the Zacks analyst, Alliance Data's rising debt level leading to higher interest expenses, increase in operating expenses, eroding margin and reliance on limited clients for revenues are concerns.

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United Parcel Service, Inc. (UPS) : Free Stock Analysis Report
Raytheon Company (RTN) : Free Stock Analysis Report
Procter & Gamble Company (The) (PG) : Free Stock Analysis Report
General Dynamics Corporation (GD) : Free Stock Analysis Report
Chevron Corporation (CVX) : Free Stock Analysis Report
Amazon.com, Inc. (AMZN) : Free Stock Analysis Report
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