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Top Research Reports for Medtronic, United Technologies & Union Pacific

Mark Vickery

Monday, December 30, 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 Medtronic (MDT), United Technologies (UTX) and Union Pacific (UNP). 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 >>>

Medtronic’s shares have outperformed the Zacks Medical Products industry year to date (+24.6% vs. +16.8%). The Zacks analyst believes that in recent times, all major business groups at Medtronic contributed to solid top-line growth at CER, which highlighted sustainability across groups and regions, in addition to displaying successful achievement of synergy targets.

In the second quarter fiscal 2019, within RTG, strong sales within spine and brain therapies more than offset slower growth in pain therapies. Within CVG, despite ongoing challenges, the company registered 1.3% growth at CER. MITG arm demonstrated sturdy growth on strength in across all businesses.

The 2020 guidance also looks promising. Medtronic has been outperforming the industry it belongs to for the past three months. On the flip side, the declining CRHF revenue raises concern for Medtronic. Escalating costs persistently put pressure on gross margin.

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

Shares of United Technologies have gained +12.3% in the past three months against the Zacks Diversified Operations industry’s rise of +12.4%. The Zacks analyst believes that strength in commercial aftermarket and military businesses, coupled with growth in commercial air traffic and high defense spending in the United States, is likely to boost revenues of the company’s aerospace business.

Also, favorable mix in Otis new equipment orders is likely to be a tailwind for the commercial business. However, the company is experiencing softness in its equipment orders at the Carrier segment due to persistent lower transport refrigeration orders. Also, rising cost of sales has been a major cause of concern.

Rise in debt levels can increase its financial obligations. Moreover, the company expects forex headwind to hurt its revenues and segmental operating profits by $550 million and $75 million, respectively, in 2019.

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

Union Pacific's shares have gained +5.8% over the past six months against the Zacks Rail Services industry's rise of +1.1%. The Zacks analyst impressed with Union Pacific's initiatives to reward its shareholders. Since November 2017, the company raised its quarterly dividend payout five times.

It is also active on the buyback front. Initiatives to control costs to drive the bottom line are also impressive. The company’s operating ratio has been constantly improving mainly owing to its cost-cutting initiatives. Operating ratio is anticipated to improve further. Backed by these tailwinds, shares of Union Pacific have outperformed its industry in a year's time.

However, sluggish overall volumes due to freight-related weakness are a major headwind. Notably, the company issued a lackluster forecast for fourth-quarter 2019 volumes at a conference in December. Union Pacific's escalated debt levels are concerning too. Also, the massive capex might be a headwind.

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

Other noteworthy reports we are featuring today include Comcast (CMCSA), Vertex Pharmaceuticals (VRTX) and NextEra Energy (NEE).

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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

Medtronic's (MDT) RTG Arm Grows Firm, CRHF Challenges Stay


Aerospace Drives United Technologies (UTX), High Debt Hurts


Union Pacific (UNP) Gains on Cost Cuts Amid Dismal Volumes


Featured Reports

High Speed Internet Subscriber Gain Benefits Comcast (CMCSA)

Per the Zacks Analyst, Comcast benefits from an expanding high-speed internet subscriber base as well as strong adoption of Xfinity Mobile service.

Vertex's (VRTX) Dependence on CF Drugs for Growth a Concern

Per the Zacks analyst, although rapid approval of Vertex's triple combo CF pill, Trikafta, was a big boost, dependence on just the CF franchise for growth amid rising competition is concerning.

Investment in Infrastructure and Renewable Aid NextEra (NEE)

Per the Zacks analyst, NextEra's $36.6B investment in 2019-2023 period to generate more electricity from renewable sources and expand its transmission and distribution lines will boost profitability.

Robust Demand Aids Lockheed (LMT), F-35 program's Cost Hurts

Per the Zacks Analyst, Lockheed Martin witnesses strong demand for its aircraft programs and missile defense systems.

Solid Gross Bookings Momentum Aids Booking Holdings (BKNG)

Per the Zacks analyst, robust merchant business, strengthening accommodation unit and rising booked room nights number are aiding Booking Holdings' gross bookings growth.

Core MedSurg Unit Aids Stryker (SYK), Pricing Pressure Ails

Per the Zacks analyst, Stryker continues to gain from solid prospects of its core MedSurg arm.

Rising Demand Aids Raytheon (RTN), High Material Costs Hurt

Per the Zacks Analyst, Raytheon enjoys solid order inflows from overseas courtesy of its combat-proven defense products. However, rising raw material costs pose a threat to the stock's growth.

New Upgrades

Strong Demand for Lilly's (LLY) Newer Drugs Boosting Sales

Per the Zacks analyst, Lilly's revenue growth is being driven by higher demand for its newer drugs like Trulicity, Jardiance, Taltz, Verzenio and Emgality as some older drugs face generic competition.

BlackBerry (BB) Poised to Benefit From Holistic Growth Model

Per the Zacks analyst, BlackBerry is likely to gain from a holistic growth model, backed by an attractive portfolio of products and services and enhanced cybersecurity business worldwide.

Strong Markets & Acquisitions Aid Commercial Metals (CMC)

Per the Zacks analyst, robust key end markets, acquisitions, favorable rebar-margin environment and growth in the United States and Poland will drive growth for Commercial Metals.

New Downgrades

Petrobras (PBR) Hurt by Weak Oil Product Sales, Debt Burden

The weaker domestic oil products sales margins, huge debt burden and involvement in the multibillion-dollar money laundering and bribery case has made the Zacks analyst turn bearish on Petrobras.

Elevated Expenses to Hurt ICICI Bank's (IBN) Profitability

Per the Zacks analyst, continued rise in expenses, due to ICICI Bank's initiatives to digitize banking operations, will likely hurt its bottom line. Deteriorating asset quality is also a major woe.

Lower Volumes & Higher Costs to Weigh on Apogee (APOG)

Per the Zacks Analyst lower volumes in Architectural Framing Systems and Architectural Glass segments as well as startup costs in Architectural Glass segment will impact Apogee's near term results.


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Vertex Pharmaceuticals Incorporated (VRTX) : Free Stock Analysis Report
 
United Technologies Corporation (UTX) : Free Stock Analysis Report
 
Union Pacific Corporation (UNP) : Free Stock Analysis Report
 
NextEra Energy, Inc. (NEE) : Free Stock Analysis Report
 
Medtronic PLC (MDT) : Free Stock Analysis Report
 
Comcast Corporation (CMCSA) : Free Stock Analysis Report
 
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