Top Research Reports for Analog Devices, The Estee Lauder & Aon
Friday, March 3, 2023
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 Analog Devices, Inc. (ADI), The Estée Lauder Companies Inc. (EL) and Aon plc (AON). 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 >>>
Shares of Analog Devices have outperformed the Zacks Semiconductor - Analog and Mixed industry over the past year (+17.6% vs. +13.8%). The company is riding on the strength across consumer, communications, industrial and automotive markets. Solid demand for high-performance analog as well as mixed signal solutions is a tailwind. Strong momentum across electric vehicle space on the back of its robust Battery Management System solutions is a positive.
Increasing power design wins are other positives. Solid momentum of HEV platform across cabin electronics ecosystem is a tailwind. The company also remains optimistic about the growth prospects related to 5G. Considering the abovementioned factors, we expect first-quarter fiscal 2023 total revenue to rise 15.3% year over year.
However, weak momentum across major applications and leveraged balance sheet are concerns. Pandemic induced supply-chain constraints and geopolitical tensions led by Russia-Ukraine war remain major overhangs.
(You can read the full research report on Analog Devices here >>>)
The Estée Lauder shares have modestly outperformed the Zacks Cosmetics industry over the past six months (+0.2% vs. -1.6%) on the back of momentum in the company's online business. In the first quarter of fiscal 2023, its freestanding store in the U.S. saw impressive performance fueled by enhanced omnichannel capabilities and more demand for high-touch services.
The Estée Lauder’s strong presence in emerging markets has been a driver. Management is on track to expand its consumer reach in productive distribution across high-growth channels while strategically expanding brands into new countries.
However, the company expects the rest of fiscal 2023 to remain pressurized by temporary hurdles stemming from pandemic-led curbs in China, foreign currency headwinds, heightened inflation, supply-chain bottlenecks and the risk of sluggishness in certain markets globally.
(You can read the full research report on The Estee Lauder here >>>)
Shares of Aon have gained +2.7% over the past year against the Zacks Insurance - Brokerage industry’s gain of +2.9%. The company’s top line has been growing on buyouts and alliances, which have enhanced its capabilities and made it one of the largest insurance brokers. Solid Reinsurance Solutions and Commercial Risk Solutions segments continue to drive the top line.
Aon has been divesting non-core operations to streamline its business. It expects that focusing on more profitable operations will generate a higher return on equity. Its pooled employer plan has reached the milestone of $1 billion in U.S. assets and commitments.
The company engages in prudent capital deployment. It had around $6.7 billion fund left under its share buyback program as of Sep 30, 2022. However, elevated operating costs can put pressure on margins. A debt-laden balance sheet compared with a lower cash balance raises a concern.
(You can read the full research report on Aon here >>>)
Other noteworthy reports we are featuring today include Truist Financial Corporation (TFC), Synopsys, Inc. (SNPS) and Parker-Hannifin Corporation (PH).
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
Battery Management System Solutions Aid Analog Devices (ADI)
Online Sales Aid The Estee Lauder Companies (EL), Costs a Woe
Acquisitions and Strong Capital Position Benefit Aon (AON)
Featured Reports
Higher Rates, Fee Income Aid Truist (TFC), High Costs a Woe
Per the Zacks analyst, loan demand, higher interest rates and Truist Financial's efforts to improve fee income will aid financials. Yet, rising costs and challenging operating backdrop are headwinds.
Synopsys (SNPS) Banks on Strong Product Menu, Contract Wins
Per the Zacks analyst, Synopsys' focus on strengthening its product portfolio is helping it cater to the growing demand in the EDA market. Deal wins at leading semiconductor companies is a tailwind.
Aerospace Systems Unit Aids Parker-Hannifin (PH), Costs Hurt
Per the Zacks analyst, Parker-Hannifin will benefit from strength in Aerospace Systems segment, led by robust OEM and MRO commercial activity. However, High operating costs remain concerning.
Baker Hughes (BKR) Banks on Oilfield Services & Equipment
Improving margin from Oilfield Services & Equipment business continues to aid Baker Hughes. However, the rising cost of revenues concerns the Zacks analyst.
Business Recovery Aids Zimmer Biomet (ZBH), Rivalry Ails
The Zacks analyst is impressed with Zimmer Biomet's robust sales growth in the fourth quarter despite macroeconomic challenges. Stiff rivalry remains a worry.
CRISPR Therapeutics' (CRSP) Pipeline Development Fuels Growth
While CRISPR Therapeutics' pipeline progress is impressive, the Zacks Analyst is concerned about a lack of stable stream of income as the company lacks marketed drugs in its portfolio.
Cracker Barrel (CBRL) Banks on Off-premise Business, Costs High
Per the Zacks analyst, Cracker Barrel is likely to benefit from off-premise business, digital efforts and loyalty program. However, commodity inflation and supply chain challenges is a concern.
New Upgrades
Solid Demand for Cloud Solutions Likely to Aid Splunk (SPLK)
Per the Zacks Analyst, Splunk is set to gain from high customer engagement, evident from consistently high net retention and competitive win rates alongside solid momentum with large orders overall.
Solid Commercial Lines Business Aids Selective Insurance (SIGI)
Per the Zacks analyst, Selective Insurance is set to grow on rising premiums aided by solid renewal pure pricing, high retention and new business growth in Commercial Lines and Excess and Supply Lines
Copa Holdings (CPA) Benefits From Improving Air-Travel Demand
The Zacks Analyst is impressed with the fact that increased air-travel demand is aiding Copa Holdings' top-line performance.
New Downgrades
Chemours (CC) Hurt by Cost Pressure & Currency Headwind
Per the Zacks Analyst, Chemours faces headwinds from high costs stemming from ore logistics constraints. A strong US dollar is also hurting segment sales.
Inflation & Currency Risks Hurt RPM International (RPM)
Per the Zacks analyst, higher labor and material costs along with currency headwinds adversely impact RPM International's growth prospect.
Lower Gas Equivalent Production to Hurt Southwestern (SWN)
For 2023, Southwestern is projecting lower total production volumes. Thus, declining production despite a favorable commodity price is hurting overall business, according to the Zacks analyst.
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Analog Devices, Inc. (ADI) : Free Stock Analysis Report
Parker-Hannifin Corporation (PH) : Free Stock Analysis Report
The Estee Lauder Companies Inc. (EL) : Free Stock Analysis Report
Aon plc (AON) : Free Stock Analysis Report
Synopsys, Inc. (SNPS) : Free Stock Analysis Report
Truist Financial Corporation (TFC) : Free Stock Analysis Report
