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Top Stock Reports for ExxonMobil, Oracle & Shell

PEBO vs. FIBK: Which Stock Is the Better Value Option?

Wednesday, December 6, 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 ExxonMobil (XOM), Oracle (ORCL) and Shell (RDS.A). 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 >>>

Strong Buy-rated ExxonMobil’s shares have underperformed the Zacks Integrated Oil industry (-8.2% vs. +4.3%) as well as peer Chevron (+2.2%) in the year to date period. However, ExxonMobil has a leading position in the energy industry owing to the size and diversity of its asset base, both in terms of business mix and geographical footprint. With a stable cash position, the company’s balance sheet is one of the best in the industry, reflecting declining debt load over the first nine months of 2017.

The Zacks analyst likes ExxonMobil’s plans to combine its refining & marketing businesses as this will allow the company to take better decisions and boost performance. ExxonMobil will generate more cashflow from downstream activities, also helping it counter the volatility in its upstream business.

Moreover, ExxonMobil’s decision to invest in the pre-salt Carcara oil field, comprising as much as 2 billion barrels of high-quality recoverable oil reserves, will boost the company’s production.

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

Shares of Oracle have underperformed the Zacks Software industry year-to-date, gaining +24.8% vs. +31.8%. The company’s soft outlook for the second quarter reflects intensifying competition from Microsoft Azure and Amazon Web Services (AWS) in the cloud. Moreover, higher investments on PaaS and IaaS will keep margins under pressure in the near term.

Nevertheless, the Zacks analyst thinks the company is benefiting from significant momentum in SaaS offerings. Oracle claims that it is wining market share against salesforce.com and Workday, which is a significant growth driver. Further, the company’s growing cloud market share will continue to drive top-line growth in the foreseeable future.

Moreover, the next-generation autonomous database, which is supported by machine learning, is a key catalyst. Additionally, the company has positive record of earnings surprises in recent quarters.

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

Shell’s shares have gained +17.7% year to date, substantially outperforming the +4.3% rally of the Zacks Integrated Oil industry, with shares getting a boost from the restoration of its full-cash dividend and strong Q3 earnings report. The integrated behemoth recently announced plans to resume full-cash dividend payouts and share repurchase program, signaling the success of its cost-containment efforts and divestment strategies.

The company’s solid third-quarter results also underscore the fact that it has successfully adapted itself to thrive at $50-barrel crude. Importantly, the Anglo-Dutch company generated healthy cash flows yet again, allowing it to cut debt and cover its cash dividend.

However, with production volumes going down, Shell's near-to-medium term revenue outlook remains cloudy. Hence, the Zacks analyst thinks investors should wait for a better entry point before buying shares in Europe's largest oil company.

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

Other noteworthy reports we are featuring today include HP (HPQ), Tyson Foods (TSN) and T. Rowe Price (TROW).

Wall Street’s Next Amazon

Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.

Click for details >>

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

Strong Downstream Business Aids ExxonMobil (XOM), Debt Low

Shell (RDS.A) Buoyed by Return to Full Cash Dividend

Oracle (ORCL) Drives on Robust Cloud-based Product Portfolio

Featured Reports

Acquisitions Aid Consolidated Water (CWCO), Irma Impact Hurts

Per the Zacks analyst, strategic acquisitions help Consolidated Water to expand its operation in complementary service industries. Yet, hurricane Irma disrupted its desalination plants' operations.

Xylem's (XYL) Supply Chain Woes to Undo High Demand Benefits

Per Zacks analyst, inability of third-party suppliers to provide required materials on time is an issue for Xylem. This will offset the positive impact of high end-market demand.

Chicken Unit to Fuel Tyson Foods (TSN), High Wages a Worry

Per the Zacks analyst, Tyson Foods is likely to gain from continued strength at its Chicken and Beef segments. However, higher wage costs and promotions pose threats to its operating performance.

Innovative Pipeline , Marketing Strategy Drives HP (HPQ)

Per the Zacks analyst, HP's sustained focus on product innovations, pricing, marketing and sales activities are helping it revive personal systems and printing business.

No-Debt Position Aids T. Rowe Price (TROW), High Costs a Woe

Per the Zacks analyst, driven by ample liquidity and zero debt, T. Rowe Price remains well poised for growth.

Lower Home Price to Weigh on Toll Brothers' (TOL) Margin

The Zacks analyst believes that lower home sale prices will likely have an adverse impact on Toll Brothers' adjusted gross margin in fiscal 2018.

Autodesk's (ADSK) Subscriber Base Grows, Restructuring Hurts

Per the Zacks analyst, Autodesk benefits from expanding subscriber base driven by strong adoption of BIM 360 and Fusion tools.

New Upgrades

Permian Expansion, Sandbox Buyout Buoy U.S. Silica (SLCA)

The Zacks analyst thinks U.S. Silica is well placed to benefit from its expansion actions in the fast-growing Permian Basin. The Sandbox acquisition should also boost margins in 2017.

Adobe (ADBE) Benefits from Creative Cloud Business Growth

The Zacks analyst believes that Adobe's cloud business contributes significant revenues and generates high margins. Frequent product, feature and service enhancements will continue to drive revenues.

PVH's (PVH) Brand Management Initiatives to Drive Growth

Per the Zacks analyst, PVH's approach to brand management aids in developing brands via efficient marketing strategies, financial control and operating leverage. This positions it for long term growth

New Downgrades

AVEO's (AVEO) Overdependence on Partners Raises Concerns

Per the Zacks analyst, AVEO is heavily dependent on partners for funds to develop its pipeline. If any of the partners terminates its deal, AVEO's future prospects would be severely hampered.

CVR Partners (UAN) Hit by Weak Nitrogen Fertilizer Pricing

Per the Zacks analyst, CVR Partners remains exposed to headwinds from weak nitrogen fertilizer prices, which may continue to put pressure on its bottom line.

Keryx's (KERX) Heavy Dependence on Auryxia Remains a Concern

The Zacks analysts remain concerned that Auryxia is the only approved product in Keryx's portfolio and the company is entirely dependent on Auryxia for growth.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Exxon Mobil Corporation (XOM) : Free Stock Analysis Report
 
Tyson Foods, Inc. (TSN) : Free Stock Analysis Report
 
T. Rowe Price Group, Inc. (TROW) : Free Stock Analysis Report
 
Royal Dutch Shell PLC (RDS.A) : Free Stock Analysis Report
 
Oracle Corporation (ORCL) : Free Stock Analysis Report
 
HP Inc. (HPQ) : Free Stock Analysis Report
 
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