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Top Research Reports for March 8, 2017

Mark Vickery

Wednesday, March 8, 2017

Today's Research Daily features new research reports on 16 major stocks, including Amazon (AMZN), Simon Property Group (SPG) and Halliburton (HAL).

Amazon shares have outperformed the broader market in the year-to-date period (the stock is up 12.8% vs. the 6% gain for the S&P 500 as a whole). A persistent concern in the Amazon story is the company's ever-growing need to build fulfillment centers that continues to weigh on its margins.

However, the analyst likes the company’s solid loyalty system in Prime and its FBA strategy, and content addition continues to add selection to Prime memberships. Also, the AWS generates much higher margins than retail, so it has a very positive impact on Amazon’s profitability. (You can read the full research report on Amazon here.)

Shares of Simon Property Group have been under pressure recently and have underperformed the Zacks REIT and Equity Trust – Retail industry over the past 3 months as well as in the year-to-date period. However, the company recently declared that it was extending its $2 billion stock repurchase program by two years. Also, Simon Property has reported better-than-expected fourth-quarter results.

The Zacks analyst particularly likes the declaration of a sequential dividend hike of 6.1%. Exposure to various retail assets, adoption of an omni-channel strategy and portfolio-restructuring moves will help the company ride the growth curve amidst a recovering economy. But, rise in online sales is a concern as it cuts the demand for retail real estate space, thereby affecting occupancy and rent growth.

An imminent hike in the interest rate will add to its woes. The company’s FFO estimate for 2017 moved down over the last 7 days. (You can read the full research report on Simon Property Group here.)

Halliburton’s shares have gained almost 53% in the last one year, handily outperforming both the Zacks Oil & Gas-Field Services industry and bigger rival Schlumberger that gained 21.2% and 10% over the same time period. The analyst likes the company’s intention to focus on international markets instead of remaining confined only to North America.

Additionally, Haliburton has managed to beat expectations in each of the last four quarters through effective cost management. However, increasing U.S production following the gathering of producers on the oil patch has offset crude price improvement to some extent. This could lead to lower activity and limit demand for Halliburton's goods and services. (You can read the full research report on Halliburton here.)

Other noteworthy reports we are featuring today include IBM (IBM), Netflix (NFLX) and CME Group (CME).

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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) Aims to Thrive Globally, Takes Prime to Mexico


Simon (SPG) Rides on Omni-channel Moves, Faces Competition


Halliburton's (HAL) Focus on International Markets Impresses


Featured Reports

IBM (IBM), Salesforce Collaborate to Strengthen Presence in A.I.

According to the Zacks analyst, IBM's recently announced artificial intelligence collaboration with salesforce bodes well for Watson's growth going forward.

Pinnacle West (PNW) Q4 Earnings Miss, Revenues Increase Y/Y

Pinnacle West is subject to numerous environmental laws and regulations, and changes in existing or new laws or regulations. Compliance costs could increase cost of operations, denting margins.

Group 1 Automotive (GPI) Beats on Q4 Earnings, Revenues Lag

Group 1 Automotive' EPS increased year over year and surpassed expectations. According to the covering analyst, it will gain from acquisition and capital deployment strategy, but risks remain.

GOL Linhas' (GOL) Q4 Revenues Improve Y/Y; Load Factor Rises

The Zacks analyst is encouraged by the company's decision to raise its 2017 EBIT margin guidance. Efforts to modernize its fleet also impress.

VeriFone's (PAY) Strong Product Portfolio to Drive Growth

The Zacks analyst thinks VeriFone's growth will be fueled by its product offerings and restructuring efforts. However, in the near term, shift in EMV deadline and forex volatility will impact results.

HCA Holdings (HCA) continues to Grow on Acquisitions

The covering analyst thinks VeriFone's growth will be fueled by its product offerings and restructuring efforts.

Equity Residential (EQR) Poised To Gain From Household Growth

The Zacks analyst thinks Equity Residential is poised to gain from household growth and portfolio-repositioning efforts.

New Upgrades

ONEOK (OKE) Gains as Distribution From Partnership Increases

ONEOK Partners is the primary growth vehicle for ONEOK Inc. In the fourth quarter of 2016, the company obtained $197.5 million as distribution from ONEOK Partners.

Netflix's (NFLX) Focus on Content & Expansion Pays Off

The Zacks analyst thinks Netflix will continue to gain more subscribers worldwide by focus on more original content. However, rising cost and stiff competition can thwart its growth prospects.

C. R. Bard (BCR) Poised to Grow on Strong Product Portfolio

The covering analyst is bullish on C.R. Bard's strong product portfolio. The company has also gained prominence in the market on a series of regulatory approvals.

New Downgrades

Walgreens Boots (WBA) Q1 Revenues Fall Y/Y, Margin Declines

The Zacks analyst is bearish on Walgreens Boots' year-over-year drop in its quarterly revenues and poor gross margin. The delay of the company's long impending buyout of Rite Aid also raises concern.

CME Group's (CME) Higher Expenses Remain a Concern

The covering analyst believes elevated total expenses remain a major concern for CME Group. The company estimates capital expenditure in the range of $100-$110 million for 2017.

Welltower (HCN) Tops Q4 FFO, Rate Hike Concerns Remain

Welltower came out with better-than-expected Q4 results. However, per the Zacks analyst, a hike in interest rate is a concern as the company has substantial exposure to long-term leased assets.


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Simon Property Group, Inc. (SPG): Free Stock Analysis Report
 
Netflix, Inc. (NFLX): Free Stock Analysis Report
 
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Halliburton Company (HAL): Free Stock Analysis Report
 
CME Group Inc. (CME): Free Stock Analysis Report
 
Amazon.com, Inc. (AMZN): Free Stock Analysis Report
 
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