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Top Research Reports for Berkshire Hathaway, Adobe & BHP

Mark Vickery

Wednesday, November 6, 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 Berkshire Hathaway (BRK.B), Adobe Systems (ADBE) and BHP Group (BHP). 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 >>>

Berkshire Hathaway’s shares have underperformed the Zacks Insurance - Property and Casualty industry year to date (8.2% vs. 9.3%). The Zacks analyst believes that a strong cash position supports earnings-accretive bolt-on buyouts. Continued insurance business growth also fuels increase in float.

Berkshire Hathaway’s third-quarter 2019 earnings of $3.21 per share beat the Zacks Consensus Estimate by 15.5% and improved 15.1% year over year on the back of better performance across all its segments. Its shares have outperformed its industry in a year’s time. It boasts to be one of the largest property and casualty insurance company measured by premium volume. Its inorganic growth story remains impressive with strategic acquisitions.

Its non-insurance businesses are delivering improved results. A sturdy capital level provides further impetus. However, exposure to catastrophe loss remains a concern. Huge capital expenses due to railroad operations pose concern.

(You can read the full research report on Berkshire Hathaway here >>>)

Shares of Adobe have gained 4.4% in the past six months against the Zacks Software industry’s rise of 11.8%. The Zacks analyst remains optimistic about Adobe’s market position, compelling product lines, continued innovation, solid adoption of Creative Cloud and Adobe marketing cloud.

Also, the company’s Adobe Document Cloud and Adobe Experience Cloud products, along with growing subscription for cloud application are positives. It has been making great efforts toward establishing its presence in cloud-related software areas such as documents and marketing.

Adobe’s increasing demand for its creative products continues to drive its top-line growth. However, lower end-market demand and exposure to Europe remain overhangs. High acquisition expenses do not bode well for its margin expansion.

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

BHP’s shares have gained 3.9% over the past three months against the Zacks Mining - Miscellaneous industry’s rise of 4.7%. The Zacks analyst believes that trade volatility and slowdown in global growth have made investors apprehensive and affected commodity markets, which in turn will weigh on BHP Group’s results.

BHP Group anticipates unit costs to be higher in fiscal 2020 thanks to natural field decline at conventional petroleum, falling copper grades, lower by-product credits and higher deferred stripping costs at Escondida. Iron ore prices have declined lately amid signs of recovery in Brazilian supply. However, metal prices will recover eventually driven by demand-supply imbalance.

Thus, BHP Group is poised to gain from its investment plans in petroleum, copper, iron ore and potash. Further, the company’s efforts to make operations efficient by adopting smarter technology across its value chain will also drive results. Strong cash flow and lower debt also bode well.

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

Other noteworthy reports we are featuring today include BlackRock (BLK), Broadcom (AVGO) and Bayer Aktiengesellschaft (BAYRY).

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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

Berkshire's (BRK.B) Railroad Business Aids, Highs Costs Hurt

Adobe (ADBE) Rides on Growing Adoption of Cloud Applications

Operational Efficiency Aid BHP Group (BHP), Low Prices Ail

Featured Reports

Assets Growth Supports BlackRock (BLK) Amid Expense Concerns

Per the Zacks analyst, improving assets under management balance and acquisitions support BlackRock's revenues. However, rising operating expenses and tough backdrop remain major near-term concerns.

Investments to Benefit ConED (ED) Amid Rising Debt Levels

Per the Zacks analyst, Consolidated Edison follows systematic capital investment plan for infrastructure development and maintain its reliability.

Strong Demand Aid Ball Corporation (BLL), Freight Costs Ail

Per the Zacks Analyst, Ball Corporation will likely gain from customers' growing preference for aluminium packaging, strong Aerospace backlog and new products despite higher freight costs.

Bayer (BAYRY) aims at New Product Launches, Amid Competition

Per the Zacks analyst, Bayer's pharmaceutical products launched over the last few quarters should continue to drive top line at the company.

Kroger's (KR) Customer 1st, Restock Program to Aid Top Line

Per the Zacks analyst, Kroger's customer 1st strategy, restock program and digital endeavors will help drive growth.

Palo Alto Networks (PANW) Rides on Product Upgrades, Buyouts

Per the Zacks analyst, Palo Alto's focus on product refreshes and prudent acquisitions like that of Twistlock and Zingbox will steadily widen its portfolio and global reach.

Marvell (MRVL) Rides On Solid Product Portfolio, Acquisitions

Per the Zacks analyst, Marvell is gaining from high demand for its OCTEON processors, Ethernet switch and PHY products. Moreover, acquisition of Cavium remains a key driver.

New Upgrades

HollyFrontier's (HFC) Throughput Volumes Rise Amid Cost Woes

The Zacks analyst believes stronger throughput volumes should bolster HollyFrontier's earnings. However, increasing operating costs and expenses remain a concern.

Robust Product Portfolio & Higher Bookings Aid Aspen (AZPN)

Per the Zacks analyst, Aspen Technology is gaining from solid adoption of its asset optimization solutions, including APM, MSC and Mtell. Also, strong pipeline for new business bookings is a positive.

Investments in Truly Brand to Aid Boston Beer's (SAM) Sales

Per the Zacks analyst, Truly brand investments through launch of new flavors, NHL deal and new ad campaign, should bolster Boston Beer's position in hard seltzer category. This is likely to aid sales.

New Downgrades

Industrial Market Weakness to Hurt Stanley Black & Decker (SWK)

Per the Zacks analyst, Stanley Black & Decker's (SWK) organic sales will suffer from weakness in industrial and emerging markets in 2019. Also, tariffs, inflation and forex woes are dragging.

E&P Spending Slowdown to Hit Halliburton (HAL) Earnings

The Zacks analyst is concerned that a conservative approach to capital expenditure from North American E&P operators will result in declining demand for Halliburton's services.

Avis Budget (CAR) Hurt by Competition, Pricing Pressure

Per the Zacks analyst, Avis Budget faces intense competition from other players in terms of pricing. Pricing pressure in the international business is weighing on its revenue per day.

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Berkshire Hathaway Inc. (BRK.B) : Free Stock Analysis Report
BlackRock, Inc. (BLK) : Free Stock Analysis Report
BHP Group Limited (BHP) : Free Stock Analysis Report
Bayer Aktiengesellschaft (BAYRY) : Free Stock Analysis Report
Broadcom Inc. (AVGO) : Free Stock Analysis Report
Adobe Systems Incorporated (ADBE) : Free Stock Analysis Report
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