Thursday, July 13, 2017
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 Boeing (BA), AbbVie (ABBV) and U.S. Bancorp (USB). 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 >>>
Boeing’s shares have surged +56.9% over the past one-year, outperforming the Zacks Aerospace & Defense sector, which gained +24.6% during the same time period. The Zacks analyst stresses that rising demand for its commercial airplanes on the back of steady improvement in passenger and freight traffic is the major factor behind the surge in Boeing shares.
Recently, the company released 20-year market outlook, as per which it forecasts jetliner demand will increase by 3.6% over this period. Further, the company’s defense business stands out among its peers by virtue of its broadly diversified programs, strong order bookings and order backlog.
However, challenges including uncertain fate of high-cost programs, risks related to key project executions, order cancellations as well as stiff competition might have a negative impact on the company. (You can read the full research report on Boeing here >>>).
Shares of AbbVie have gained +14.8% year to date, outperforming the large cap pharma industry, which has gained +11.3% over the same period. The Zacks analyst likes its key drug Humira’s performance. Sales should continue to be driven by growing awareness, favorable clinical data, additional indications and expansion into new markets.
Moreover, products like Viekira and Imbruvica have diversified AbbVie’s revenue base. AbbVie has a deep and promising pipeline and is also working on expanding its portfolio though additional deals. On the flip side, the Zacks analyst points out that Viekira faces intense pricing pressure and competition in the HCV market.
Additionally, quite a few companies are working on bringing Humira biosimilars to the market. Estimates remain stable ahead of the company’s Q2 earnings release. AbbVie has had a mixed record of earnings surprises in recent quarters. (You can read the full research report on AbbVie here >>>).
U.S. Bancorp’s shares have underperformed the Zacks categorized Regional Banks-Major industry over the last one year, gaining +25.8% vs.39.3%. Rising expenses and litigations remain key concerns. However, the Zacks analyst thinks the company’s growth prospects should get support from its solid business model, core franchise and diverse revenue streams.
Though the company raised its prime lending rate to 4.25%, following the recent Fed interest rate hike, easing of margin pressure is skeptical. Nevertheless, the approval of Financial Choice Act is expected to support U.S. Bancorp’s profitability going forward. Notably, the bank received the Fed's approval for its 2017 capital plan. (You can read the full research report on U.S. Bancorp here >>>).
Other noteworthy reports we are featuring today include Netflix (NFLX), Biogen (BIIB) and Constellation Brands (STZ).
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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
Lower Q2 Commercial Deliveries Hurt Boeing (BA)
AbbVie (ABBV) to Focus on Humira and Imbruvica in 2017
Loan Growth Aids U.S. Bancorp (USB), Technology Costs a Woe
Biogen (BIIB) Diversifies Beyond Multiple Sclerosis Market
The Zacks analyst likes Biogen's efforts to diversify beyond MS to areas such as Alzheimer's as competition in the market is rife.
Sempra Energy (SRE) to Gain from $115M Liquid Fuel Deal
Per the Zacks analyst, Sempra Energy's recently won deal, to construct a liquid fuel terminal in Mexico, will boost its operational growth in the nation's expanding energy market.
Debt Cuts, Production Growth Actions to Aid Newmont (NEM)
The covering analyst thinks Newmont should gain from efforts to boost production performance, de-lever its balance sheet and improve operational efficiency.
Constellation Brands (STZ) to Gain from Solid Beer Business
Per the Zacks analyst, solid trends at the beer business, is likely to continue driving Constellation Brands' performance.
Focus on Trading Activities Supports E*TRADE's (ETFC) Growth
Per the Zacks analyst, E*TRADE's efforts to enhance trading business through introduction of new brokerage products and services is commendable.
KB Home (KBH) Rides on KB2020 Business Strategy
Per the Zacks analyst, KB Home has the right strategy, KB2020, to boost scale in existing geographic footprint, improve profitability per unit, generate higher operating margin and drive earnings.
WPP (WPPGY) Offers Bullish View on Holistic Growth Model
Per the Zacks analyst, with a balanced organic and inorganic growth model, WPP offered a healthy dividend to reward shareholders with risk-adjusted returns and provided bullish guidance for 2017.
Netflix's (NFLX) Growth to be Fueled by Overseas Expansion
Per the Zacks analyst, Netflix's growth will be fueled by rapid international expansion. Plus, its ever expanding portfolio of original content bodes well for future growth.
HCA (HCA) Poised for Growth on Expansion in Urban Markets
Per the covering analyst, the company's efforts to expand services and capacity in large, fast growing urban markets, will drive its top line. Its strong balance sheet enables mergers & acquisitions.
Abiomed (ABMD) Set to Grow on Impella and Expansion Plans
Per the Zacks analyst, Abiomed's growing Impella business, consistent focus on expanding product pipeline and steady investments on capacity expansion are key growth catalysts.
Aqua America (WTR) Faces Risk of Weather & Contamination
The Zacks analyst believes Aqua America faces the risk of fluctuating weather patterns and contamination of its water resources, which could adversely impact demand for water.
Rising Long-Term Debt, Lower Cash to Hurt Weatherford (WFT)
The Zacks analyst is concerned with Weatherford's escalating long-term debt load over the past few quarters. Inadequate cash balance has further worsened the situation.
Cincinnati Financial's (CINF) Exposure to Catastrophe Hurts
Per the Zacks analyst, Cincinnati Financial's exposure to catastrophe hurts underwriting results. Also, life insurance segment could be hurt by turmoil in group benefits.
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U.S. Bancorp (USB) : Free Stock Analysis Report
Constellation Brands Inc (STZ) : Free Stock Analysis Report
Netflix, Inc. (NFLX) : Free Stock Analysis Report
Biogen Inc. (BIIB) : Free Stock Analysis Report
Boeing Company (The) (BA) : Free Stock Analysis Report
AbbVie Inc. (ABBV) : Free Stock Analysis Report
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