Top Analyst Reports for Meta Platforms, Eaton & Cigna
Monday, February 5, 2024
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 Meta Platforms, Inc. (META), Eaton Corporation plc (ETN) and The Cigna Group (CI). 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 >>>
Meta Platforms shares have outperformed the Zacks Internet - Software industry over the past year (+155.3% vs. +65.4%), with the blockbuster December-quarter results adding to the stock's momentum. The company is benefiting from steady user growth across all regions, particularly Asia Pacific. Increased engagement for its offerings like Instagram, WhatsApp, Messenger and Facebook has been a major growth driver.
Meta Platforms’ is leveraging AI to recommend Reels content, which is driving traffic on Instagram and Facebook. Its innovative portfolio, which includes Threads, Reels and Llama 2, is likely to aid prospects.
However, challenging macroeconomic conditions remain a headwind for Meta’s advertising revenues, along with targeting and measurement headwinds due to Apple’s iOS changes. Slow monetization of Reels, along with mounting operating losses at Reality Labs, are concerns.
(You can read the full research report on Meta Platforms here >>>)
Shares of Eaton have outperformed the Zacks Manufacturing - Electronics industry over the past year (+69.4% vs. +28.4%). The company’s research and development are allowing it to develop new products to provide efficient power management solutions.
It will benefit from improving end-market conditions, increasing demand from the new AI data center and contributions from its organic assets. Eaton is expanding via acquisitions and its rising backlog shows demand for its products. Its strategy to manufacture in the region of its end market has helped it cut costs.
However, Eaton’s global operations expose it to unpredictable currency translation, cyber security threats, changes in tax rates and security breaches, which might impact operations. The shortage of raw materials and supplier insolvencies might impact production and operations.
(You can read the full research report on Eaton here >>>)
Cigna shares have outperformed the Zacks Medical - HMOs industry over the past year (+14.3% vs. +7.7%). The company’s revenues have been increasing consistently for the past few years, driven by acquisitions, superior operating performance and a high-quality product portfolio. It expects adjusted revenues to jump 20% in 2024.
Value-enhancing divestitures will help it to focus on core growth areas. High membership on the back of a diversified portfolio, wide agent network and superior service are major positives. It reported strong Q4 results, driven by higher memberships. The company has been resorting to prudent capital deployment moves through share repurchases and dividend payments.
However, high leverage can affect its financial flexibility. Rising operating costs due to higher pharmacy and other service costs are a concern. As such, the stock warrants a cautious stance.
(You can read the full research report on Cigna here >>>)
Other noteworthy reports we are featuring today include Colgate-Palmolive Company (CL), Parker-Hannifin Corporation (PH) and Amphenol Corporation (APH).
Director of Research
Sheraz Mian
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
User Growth, Instagram Strength Aids Meta Platforms (META)
New Product Development, Wide Market Reach Aid Eaton (ETN)
Cigna (CI) Aided by Strategic Acquisitions Amid High Costs
Featured Reports
Colgate (CL) Gains From Organic Sales & Pricing Actions
Per the Zacks analyst, Colgate is benefitting from pricing and other productivity initiatives. It saw organic sales growth in five out of six divisions and in all four categories in third quarter.
Aerospace Systems Unit Aids Parker-Hannifin (PH), Costs Hurt
Per the Zacks analyst, Parker-Hannifin benefits from strength in the Aerospace Systems unit, led by strong momentum in the commercial aftermarket end market. High operating costs remain a woe.
End-Market Strength & Diversification Aids Amphenol (APH)
Per the Zacks analyst, Amphenol benefits from commercial air, military, industrial and automotive end-market demand. Diversified business model also lowers volatility of individual geographies.
Strong Portfolio & Acquisitions to Drive PTC's Performance
Per the Zacks analyst, PTC's performance is being driven by robust demand for products like Creo and Windchill and strategic acquisitions. However, stiff competition is a headwind.
Quest Diagnostics (DGX) Expands Tactically, COVID Sales Dip
The Zacks Analyst is impressed with Quest Diagnostics gaining from innovative testing solutions, strong health plans tie-ups and a robust M&A pipeline. Yet, COVID Testing sales drop mars growth.
Xifaxan Boosts Bausch (BHC), Efforts to Restructure Look Good
Per the Zacks analyst, Bausch maintains momentum on strong growth of Xifaxan. The company's efforts to restructure business by separating eye health business and reduce debt are encouraging.
Brinker (EAT) Banks on Strategic Initiatives, High Costs Ail
Per the Zacks analyst, Brinker is likely to benefit from marketing efforts, pricing strategies and menu adjustments. However, rising restaurant labor costs remain headwinds.
New Upgrades
Robust Backlog & Expansion Initiatives to Aid Oshkosh (OSK)
The Zacks analyst is optimistic about Oshkosh's consolidated backlog of $16.8 billion, which provides enough visibility for the future. Its expansion initiatives are poised to accelerate growth.
Pilgrim's Pride (PPC) Gains From Robust European Operations
Per the Zacks analyst, Pilgrim's Pride is gaining from higher sales in European operations for a while now. During third-quarter sales in the region increased 9.1% year over year.
Solid Loan Growth & High Liquidity Aids UMB Financial (UMBF)
Per the Zacks analyst, UMB Financial benefits from revenue strength, aided by rising loan balances along with diversified fee income. Also, strong liquidity position aids steady capital distributions.
New Downgrades
Concentration on Several Basins to Affect Ovintiv (OVV)
The Zacks analyst thinks that Ovintiv might benefit from focusing more on its core business by selling off some of its non-core acreage.
C.H. Robinson (CHRW) Grapples With Challenging Freight Market
Per the Zacks Analyst, lower pricing in the ocean and truckload services and overall weak freight demand hurt C.H. Robinson's fourth-quarter 2023 results.
Avnet (AVT) Hurt by Declining Demand, High Inventory Levels
Per the Zacks analyst, softened demand in a tight IT spending environment, along with high inventory levels at customers, is likely to hurt Avnet's financial performance in the near term.
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Amphenol Corporation (APH) : Free Stock Analysis Report
Parker-Hannifin Corporation (PH) : Free Stock Analysis Report
Eaton Corporation, PLC (ETN) : Free Stock Analysis Report
Colgate-Palmolive Company (CL) : Free Stock Analysis Report
Cigna Group (CI) : Free Stock Analysis Report
Meta Platforms, Inc. (META) : Free Stock Analysis Report
