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Top Research Reports for Today: BRK.B, ORCL, MRK

Mark Vickery

Wednesday April 19, 2017

Today's Research Daily features new research reports on 16 major stocks, including Berkshire Hathaway (BRK.B), Oracle (ORCL) and Merck (MRK).

Berkshire Hathaway's shares have lost ground lately, with the stock lagging the broader market since March 1st. The stock has also fallen behind the S&P 500 and the Zacks Finance sector. The insurance business, which remains at the core of this financial conglomerate's business portfolio, is as much a beneficiary of the post-election momentum in interest rates as are traditional banks and brokers. But Berkshire Hathaway is more than insurance - it has assets in the railroads, oil pipelines and many other spaces.

Investment in Apple (increasing its stake fourfold) and in the four biggest U.S. airlines (increased sevenfold) is testimony to the confidence in the post-election business environment. The company's name has long been synonymous with Warren Buffet, concerns about whose succession have been an issue for the stock. The company is expected to report first quarter results on May 5th. (You can read the full research report on Berkshire Hathaway here.)

Shares of Oracle has outperformed the Zacks Technology Sector year-to-date, gaining +15.8% vs. +8.1%. The company’s offerings in SaaS and PaaS have gained significant momentum in the past few quarters, which improves competitive position against salesforce.com and Workday. The introduction of Gen 2 IaaS data centers is expected to improve Oracle’s competitive prowess against Amazon.

The Zacks analyst likes the company’s growing cloud market share and believes it will continue to drive top-line growth for the foreseeable future. The recent acquisition of Moat is a significant addition to the Oracle Data Cloud, which will boost ad measurement capability. However, the transition from on-premise licensing to cloud-based subscription business model will take some more time to complete, which will impact near-term results. (You can read the full research report on Oracle here.)

Merck’s shares have gained +10% over the last one year, outperforming the Zacks Large Cap Pharma industry which has lost -2.7% over the same period. The Zacks analyst likes Merck’s new products, especially Keytruda, which should continue to contribute meaningfully to the top line. Merck will continue to focus on cost-cutting initiatives to drive the bottom line.

The company has also made significant progress with its pipeline and is working on bringing new products to the market. Merck has also been pursuing acquisitions and business development deals to boost its pipeline. However, generic competition and pricing pressure will continue to pressurize the top line. Merck will continue to focus on cost-cutting initiatives to drive the bottom line. The company has also made significant progress with its pipeline and is working on bringing new products to the market.

However, generic competition and pricing pressure will continue to pressurize the top line. Estimates have gone up ahead of the company’s Q1 earnings release. Merck has a positive record of earnings surprises in the recent quarters. (You can read the full research report on Merck here.)

Other noteworthy reports we are featuring today include DuPont (DD), Honeywell (HON) and Altria (MO).

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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 Hathaway (BRK.B) Set to Grow on Core Strengths

Oracle (ORCL) to Buy Ad Verification Software Maker Moat

Merck's (MRK) New Drugs to Drive Sales; Generic Pressures Stay

Featured Reports

Occidental's (OXY) Focus in Oil & Gas will boost performance

The Zacks analyst believes Occidental's investment in oil and gas operation will yield positive results amidst the competitive energy sector.

Prologis (PLD) Tops Q1 FFO Estimates, Supply Raises Risks

The covering analyst thinks Prologis' better-than-expected result displays solid demand for industrial real estates. Yet, projected growth in supply of new facilities in upcoming period raises risks.

J.B. Hunt (JBHT) Beats Q1 Earnings, Misses Sales Estimates

The Zacks analyst is pleased with the company's Q1 earnings beat. However, the revenue miss raises concerns.

Altria (MO) to Focus on e-Cigarettes Amid Anti-Smoking Rules

The covering analyst thinks Altria Group is expanding the distribution of MarkTen XL e-vapor products amid declining tobacco volumes.

Interactive Brokers' (IBKR) Q1 Results Show Revenue Pressure

The Zacks analyst believes Interactive Brokers' Q1 earnings reflects continued pressure on top line, despite the company being well poised for growth given the optimization of resource allocation.

GNC Holdings (GNC) Tops Q1 Earnings, Sales, Y/Y Results Upset

The covering analyst is bullish about GNC's better-than-expected Q1 performance with successful execution of 'One New GNC' plan.

Phillips' (PSX) Focus on Midstream Business Impresses

The Zacks analyst appreciates Phillips 66's aim to allocate money for higher margin business units like Midstream and Chemicals.

New Upgrades

Eaton (ETN) Poised to Gain from Wide Reach & Product Variety

The Zacks analyst believes Eaton will gain from its extensive market reach, restructuring initiatives and product innovation.

Methanex (MEOH) Well Placed on Solid Demand, Geismar Project

The covering analyst thinks Methanex should gain from strong demand fundamentals for methanol. Its Geismar project should also contribute to cash generation and create significant shareholder value.

DuPont (DD) to Gain from Cost Cuts, Merger Synergies

The Zacks analyst believes that DuPont should continue to gain from aggressive cost actions as well as new product launches. The planned mega-merger with Dow should also create significant synergies.

New Downgrades

Honeywell (HON) Grapples with Macro Woes & Soft Demand Trend

Honeywell anticipates a tepid demand pattern for its business jets and mobile scanners in 2017 due to sluggish global growth, volatile oil prices and a soft Chinese economy.

NVIDIA (NVDA) Down On Stiff Competition and Weak PC Outlook

According to the Zacks analyst, a weak outlook for the PC industry and intensifying competition could weigh on NVIDIA's profits, market share and top-line growth.

Avis Budget (CAR) Grapples with Volatility in Market Demand

Intense competitive pressures reduce the profitability of Avis Budget and contract its market share. Volatility in market demand and dependence on third-parties remain additional headwinds.

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Oracle Corporation (ORCL): Free Stock Analysis Report
Merck & Company, Inc. (MRK): Free Stock Analysis Report
Altria Group (MO): Free Stock Analysis Report
Honeywell International Inc. (HON): Free Stock Analysis Report
E.I. du Pont de Nemours and Company (DD): Free Stock Analysis Report
Berkshire Hathaway Inc. (BRK.B): Free Stock Analysis Report
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