Thursday, January 10, 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, Morgan Stanley (MS), Intuitive Surgical, Inc. (ISRG) and Colgate-Palmolive Company (CL). 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 >>>
Morgan Stanley’s shares have lost 12.6% in the last six months, outperforming the Zacks Investment Banking industry, which has lost 16.2% over the same period.The company possesses an impressive earnings surprise history, beating the Zacks Consensus Estimate in each of the trailing four quarters.
The company’s efforts to strengthen wealth management business, focus on corporate lending, steady loan growth, higher interest rates and normalized levels of trading activities will further support revenues. Also, its steady capital deployment plan reflects strong balance sheet position.
However, a slowdown in debt originations will hamper underwriting fee income growth. Further, mounting operating expenses is a major near-term concern for the company.
(You can read the full research report on Morgan Stanley here >>>).
Shares of Buy-ranked Intuitive Surgical have gained +2.6% in the last six months, outperforming the Zacks Medical Instruments industry which has lost -4.9% over the same period. The company’s robotic platform – da Vinci System – recorded solid growth in recent times. This is led by strong performance in U.S. general surgery procedures and global urologic procedures. Management expects strong contributions from da Vinci in 2019 as well. Commencement of da Vinci sale in Taiwan also adds to the positives.
Management is also optimistic about the company’s collaboration with InTouch Health. On the negative side, the company expects outside U.S. sales to be a bit lumpy in the quarters ahead. These markets are in early stages of adoption.
(You can read the full research report on Intuitive Surgical here >>>).
Shares of Colgate-Palmolive have underperformed the Zacks Consumer Staples industry over the past three months (-1.7% vs. +8.1%). Colgate is smoothly progressing with its cost-savings program. Notably, the Global Growth and Efficiency Program and Funding the Growth initiative are delivering impressive results.
Management approved an expansion and extension of the program through Dec 31, 2019, which will enable it to take advantage of the incremental opportunities while streamlining operations. Further, the company’s meet or beat earnings long track record remains impressive.
It also provided a favorable earnings view for 2018. However, the stock has lagged the industry in the past three months. It has a dismal sales trend, missing estimates in 21 of the last 22 quarters. Management anticipates a tough backdrop due to uncertain global markets and slowing category growth worldwide.
(You can read the full research report on Colgate-Palmolive here >>>).
Other noteworthy reports we are featuring today include Ecolab (ECL), Keurig Dr Pepper (KDP) and Prudential Financial (PRU).
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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
Wealth Management Aids Morgan Stanley (MS), High Costs a Woe
Strong Exposure to Robotics Aids Intuitive Surgical (ISRG)
Colgate's (CL) Cost-Savings Program is Likely to Aid Margins
Nektar's (NKTR) Oncology Deals, Pipeline Driving Growth
Per the Zacks analyst, Nektar has collaborations with large pharma companies which provide significant amount in fees and a robust pipeline. However, the company relies on partners for revenues.
Fleet Upgrade Efforts Buoy Delta (DAL) Amid Capacity Woes
The Zacks analyst is concerned about capacity expansion outpacing traffic growth at Delta. Unit revenue-related woes are also concerning. However, initiatives to modernize its fleet are encouraging.
Business Expansion Aids POSCO (PKX) Amid Exchange Rate Woes
Per the Zacks analyst, POSCO will benefit from focus on mergers and business expansion. However, its results will be hurt by the negative effect of exchange rate and interest rate rise.
Telefonica Brasil (VIV) Rides on Network Expansion Strategy
Per the Zacks analyst, investments in technology upgrade with broadband network infrastructure expansion should continue to drive Telefonica Brasil's leadership position in data and postpaid segments.
International Business Expansion Aids Prudential (PRU)
Per the Zacks analyst, Prudential continues to put in substantial efforts to boost and expand its international operations, thereby resulting in its overall growth. But rising costs raise concern.
Acuity Brands (AYI) Banks on Innovative Lighting Solutions
Per the Zacks analyst, Acuity Brands is poised to gain from diversified portfolio of innovative lighting control solutions and energy-efficient luminaries. However, rising input costs raise concern.
Improving Retention Rate, Pay-TV Resizing Aids DISH (DISH)
Per the Zacks analyst, DISH's excellent customer service is improving retention. Also focus on acquiring and retaining subscribers that are profitable over the long term, is paying off.
Focus on Trading Business Supports E*TRADE's (ETFC) Growth
Per the Zacks Analyst, E*TRADE's efforts to enhance trading business by introduction of new brokerage products and services.
Customer Growth, Ongoing Investments Drive IDACORP (IDA)
Per Zacks analyst IDACORP's planned capital investment in excess of $1.4 billion in 2018-2020 time period and rising customer base coupled with increasing usage per customer will boost performance.
Sluggishness in the Energy Segment Plagues Ecolab (ECL)
Ecolab expects dull performance in the Energy unit in the coming quarters. The Zacks analyst apprehends that unfavorable pricing, margin woes and competition are the drivers behind the dull outlook.
Keurig Dr Pepper (KDP) Suffers on CSD and Cost Concerns
Per the Zacks analyst, Keurig Dr Pepper is prone to industry headwinds related to soft CSD category and high input costs.
Southern (SO) Wrecked by Vogtle, Kemper Project Overruns
The Zacks analyst is concerned that continued timing and cost overrun issues related to Southern Company's two mega construction projects will lead to high degree of uncertainty.
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