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Top Stock Reports for Amazon, Procter & Gamble & UnitedHealth

Mark Vickery
The opening of second Amazon Go store in New York is likely to strengthen Amazon's (AMZN) expansion strategy.

Monday, June 3, 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 Amazon (AMZN), Procter & Gamble (PG) and UnitedHealth (UNH). 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 >>>

Amazon’s shares have outperformed the broader market in the past year (the stock is up +9.5% vs. the -0.9% decline for the S&P 500 as a whole). The Zacks analyst thinks Amazon continues to ride on its aggressive retail strategies, distribution strength and robust Prime program.

Rapid adoption of Prime driven by customer benefits and strengthening grocery services is aiding its top line. Expanding content portfolio of Prime remains a tailwind. Strengthening AWS services portfolio, rising number of availability zones and growing adoption are aiding Amazon’s dominance in the cloud space.

Furthermore, improving Alexa skills and growing advertisement business remain major positives. However, intensifying competition in the cloud computing market from the likes of Microsoft Azure and Google cloud is a significant headwind. Heavy investment in fulfillment centers remains a concern.

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

Shares of Outperform-rated Procter & Gamble outperformed the Zacks Soap and Cleaning Materials industry in the past year, gaining +43.8% vs. +23.8%. The Zacks analyst thinks that this can be attributed to the company’s impressive earnings history. It delivered its 16th straight earnings beat in third-quarter fiscal 2019 as well as its sixth sales beat of the last seven quarters.

While earnings gained from ongoing productivity efforts, strong organic growth with higher shipment volumes and favorable price/mix aided sales growth. Management raised the sales guidance for fiscal 2019 and reaffirmed its earnings view. The company’s focus on product improvement, packaging and marketing initiatives, and productivity and cost-savings plan bode well.

However, Procter & Gamble has been witnessing strained margins owing to increased commodity and shipping costs, higher brand investments amid intense competition. Adverse currency rates are hurting the company’s results, which may persist in fiscal 2019.

(You can read the full research report on Procter & Gamble here >>>).

Outperform-rated UnitedHealth’s shares have lost -11.1% in the past six months, outperforming the Zacks Medical Insurance industry, which has declined -12.5% over the same period. The Zacks analyst likes its strong operating performance, favorable business profile and disciplined enterprise risk management. It stands apart from its industry peers by virtue of healthcare services, technology and innovations offered by its unit, Optum.

Numerous acquisitions made by the company have broadened its business profile and provided the benefits of diversification. Its solid balance sheet and consistent cash flow generation have enabled higher investment in business which will drive long term growth. Prudent capital management through dividend payments and share buybacks is another positive.

However, a slowdown of growth in international operations and underperformance in Medicaid business are key concerns. An increase in leverage and interest burden raises financial risk.

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

Other noteworthy reports we are featuring today include Toyota (TM), Autodesk (ADSK) and Veeva (VEEV).

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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) Rides on Prime & AWS Amid Rising Competition

P&G's (PG) Productivity & Cost Savings Plan to Drive Profits

Strong Optum, Solid Balance Sheet Aids UnitedHealth (UNH)

Featured Reports

Subscriber Growth, Accretive Buyouts Drive Autodesk (ADSK)

According to the Zacks analyst, growing subscriber base along with robust portfolio of offering, accretive acquisitions and strong cash position are the key catalysts for Autodesk.

Improving Product Mix Boosts Toyota (TM) Amid Soaring Costs

Per the Zacks analyst, altering the product line with SUVs and trucks across North America, Europe and Asia are driving sales.

Core Subscription Arm Aids Veeva (VEEV) Amid Competition

The Zacks analyst is apprehensive of an intensely competitive healthcare IT industry.

BioMarin (BMRN) Rare Disease & Gene Therapy Pipeline Solid

BioMarin's impressive rare disease pipeline is progressing well with several data-readouts scheduled this year. Its growing pipeline focus towards gene therapy agents encourages the Zacks analyst.

DXC Technology (DXC) Rides on Strength in Digital Business

Per the Zacks analyst, growth in enterprise and cloud applications, cloud infrastructure and digital workplace offerings, are boosting DXC Technology's digital business.

Rising Transaction Fees Aid Cboe Global (CBOE), High Cost Ail

Per the Zacks analyst, CBOE Global is poised to grow on creasing transaction fees that in turn are driven by trading volume growth.

New Store Openings Aid Advance Auto (AAP) Amid Expense Woes

Per the Zacks analyst, new store openings, expansion of online presence and strategic collaborations aid Advance Auto's growth.

New Upgrades

Renewables Focus, Improving Economy Aid Xcel Energy (XEL)

Per the Zacks analyst, Xcel Energy's renewable focus will lower emission and improving economic conditions in its service territories will drive demand for natural gas and electricity.

Sunoco (SUN) Banks on Refined Products Terminals Acquisition

Per the Zacks analyst, Sunoco will gain heavily from the acquired refined products terminals, having 77,500 million BPD throughput capacity, located in North Texas and Arkansas.

Ligand's (LGND) Captisol Technology Drives Revenue and Deals

Per the Zacks analyst, Ligand's Captisol technology is the key driver of revenues in the form of royalties. It also helps the company to enter new partnerships creating future revenue options.

New Downgrades

Schneider National (SNDR) Hit by Truckload Unit, High Costs

The Zacks analyst is worried about the underperformance by Schneider National's truckload segment. Moreover, high operating expenses are hurting the bottom line.

Finisar (FNSR) Stifled by Trade Restrictions & Margin Woes

Per the Zacks analyst, trade restrictions for several U.S. products and high tariffs remain concerns for Finisar. Margin pressures due to promotional offers and discounts remain additional headwinds.

Output Woes, Gas Import Losses Weigh on PetroChina (PTR)

The Zacks analyst is worried over PetroChina's weak oil production growth prospects.

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Veeva Systems Inc. (VEEV) : Free Stock Analysis Report
UnitedHealth Group Incorporated (UNH) : Free Stock Analysis Report
Toyota Motor Corporation (TM) : Free Stock Analysis Report
Procter & Gamble Company (The) (PG) : Free Stock Analysis Report
Amazon.com, Inc. (AMZN) : Free Stock Analysis Report
Autodesk, Inc. (ADSK) : Free Stock Analysis Report
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