Friday, August 30, 2019
The Zacks Research Daily presents the best research output of our analyst team. Today's Research Daily features updated research reports on 16 major stocks, including Boeing (BA), Starbucks (SBUX) and 3M (MMM). These research reports have been hand-picked from roughly 70 reports published by our analyst team today.
You can see all of today’s research reports here >>>
Boeing’s shares have gained +12.5% year to date, underperforming the Zacks Aerospace & Defense industry, which has increased +26.6% during the same time period. The Zacks analyst stresses that Boeing remains the largest aircraft manufacturer globally in terms of revenues, orders and deliveries, and one of the major aerospace and defense contractors.
Boeing expects the commercial fleet to be fueled by sustained annual growth in commercial passenger traffic along with a big wave of retiring, old planes. Its proposed joint venture with Embraer is expected to strengthen Boeing’s commercial business significantly.
However, the commercial business suffered a major setback lately due to lower 737 deliveries, following the 737 Max product line's grounding and subsequent costs associated with it. Consequently, its revenues, earnings and cash flow position were affected significantly.
(You can read the full research report on Boeing here >>>).
Shares of Starbucks are up +37.9% over the past six months, outperforming the Zacks Food & Restaurants industry, which is up +21% over the same period. The Zacks analyst thinks the momentum is likely to continue as the company reported solid third-quarter fiscal 2019 earnings and also raised its full-year view.
Notably, earnings surpassed the estimates in each of the trailing five quarters. Robust Americas and CAP comps too bode well. The company now anticipates global comps growth of nearly 4%. Non-GAAP EPS is expected to be $2.80-$2.82, up from $2.75-$2.79 guided previously.
Meanwhile, Starbucks' business is rapidly growing in China, courtesy of innovative store designs and the success of the MSR program. Also, operating fundamentals such as solid global footprint, successful innovations, best-in-class loyalty program and digital offerings are encouraging. However, operating margin contraction over the past few quarters has been a concern.
(You can read the full research report on Starbucks here >>>).
3M’s shares have lost -22.7% in the past six months, underperforming the Zacks Diversified Operations industry, which has declined -4.6% over the same period. The Zacks analyst thinks 3M stands to gain from efforts to innovate products, solid demand, restructuring actions and shareholder-friendly policies over the long run.
Its acquisition of the technology business of M*Modal is benefiting the Health Information Systems business. Also, divestments of advanced ballistic-protection business (not yet complete), and the gas and flame detection business (closed in August 2019) will help the company concentrate on more profitable businesses.
Also, it faces risks from forex woes (likely to impact sales by 1%), high tax rates, rising costs and restructuring charges. For 2019, the company predicts earnings to be $9.25-$9.75 per share, down from $10.46 recorded in 2018.
(You can read the full research report on 3M here >>>).
Other noteworthy reports we are featuring today include Restaurant Brands (QSR), Deere (DE) and Dollar General (DG).
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Note: Our Director of Research 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
Strategic Mergers Aid Boeing (BA), Low 737 Deliveries Hurt
Starbucks' (SBUX) Strong Global Footprint to Drive Growth
3M (MMM) Gains From Divestment Moves, Forex Woes Drags
Construction Demand & Acquisitions Aid Deere (DE), Costs Ail
Per the Zacks analyst, Deere will gain from improving construction demand and the Wirtgen acquisition amid higher costs and a weak agricultural sector.
Sturdy Comps to Fuel Dollar General (DG), SG&A Costs a Woe
Per the Zacks analyst, Dollar General has been recording positive comps, which is likely to grow low-to-mid 3% range in fiscal 2019.
Restaurant Brands' (QSR) Sales Building Efforts Bode Well
Per the Zacks analyst, Restaurant Brands' solid expansion efforts, various sales building strategies and focus on franchise business model should drive growth.
Assets Growth Support Eaton Vance (EV), High Costs a Concern
Per the Zacks analyst, improving assets under management and diverse product offerings will aid Eaton Vance's revenues.
Expanding User Base, Solid AHV Adoption Aids Nutanix (NTNX)
Per the Zacks analyst, Nutanix is benefiting from steady deal wins, expanding customer base and solid adoption of its products, particularly the AHV hypervisors.
Growth in Europe to Keep Driving Guess?' (GES) Top Line
Per the Zacks analyst, Guess? is gaining from solid business progress in Europe. Management continues to invest in this region, wherein it expects revenues to rise high-single digits in fiscal 2020.
Navigant (NCI) to Gain from Investments, Talent Cost a Woe
The Zacks analyst believes that investments in technology and development programs will accelerate Navigant's organic growth.
t:slim X2 Rollout, Favorable Market Trends Aid Tandem (TNDM)
The Zacks analyst is bullish about Tandem's strong international rollout of t:slim X2 insulin pump. Huge global demand for diabetes care devices on favorable market trends is another growth driver.
Rising Assets and Interest Rates Support Federated (FII)
Per the Zacks analyst, Federated's strategic acquisitions have resulted in asset growth and expansion in market share. Also, relatively higher interest rates will positively aid top-line performance.
Cadence (CDNS) Rides on EDA, Hardware & IP Solutions Demand
Per the Zacks analyst, Cadence benefits from solid demand of its broad based product portfolio. Traction witnessed by Palladium Z1 and EDA-optimized Cloud-Hosted Design solution is also a positive.
Power & Renewable Energy Issues Hurts General Electric (GE)
Per the Zacks analyst, General Electric suffers from external and internal challenges in Power segment. Also, margin weakness in Renewable Energy is a problem.
Stiff Competition & Rising Expenses Hurt Twitter (TWTR)
Per the Zacks analyst, Twitter's growth prospects suffer from intensifying competition for ad dollars due to the dominance of Facebook and Google. Increasing expenses is a concern.
Goodyear (GT) to be Hurt by Weak Asia-Pacific, European Units
Per the Zacks analyst, growing U.S.-Sino trade tiff is weighing on carmakers. Resultantly, Goodyear's business conditions are becoming tougher, hurting profits. Low demand in Europe is also a concern.
Starbucks Corporation (SBUX) : Free Stock Analysis Report
Restaurant Brands International Inc. (QSR) : Free Stock Analysis Report
3M Company (MMM) : Free Stock Analysis Report
Dollar General Corporation (DG) : Free Stock Analysis Report
Deere & Company (DE) : Free Stock Analysis Report
The Boeing Company (BA) : Free Stock Analysis Report
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