Monday, August 26, 2019
The Zacks Research Daily presents the best research output of our analyst team. Today's Research Daily features updated research reports on 16 major stocks, including salesforce (CRM), Intuit (INTU) and Enterprise Products (EPD). These research reports have been hand-picked from roughly 70 reports published by our analyst team today.
You can see all of today’s research reports here >>>
salesforce’s shares have lost -7% in the past six months, underperforming the Zacks Computer Software industry, which has gained +10.2% over the same period. salesforce reported strong second-quarter fiscal 2020 results. The Zacks analyst thinks the company is gaining from solid growth across all its cloud offerings and geographies.
Deal wins in the international market is a key driver. Rapid adoption of its diverse cloud offerings, given an upsurge in demand for digital transformation, is a key catalyst. Strengthening relationships with cloud companies like Amazon, Google and IBM are an upside. Additionally, strategic acquisitions like MuleSoft, Tableau, ClickSoftware and Salesforce.org are a positive.
However, stiff competition from Oracle and Microsoft is a concern. Unfavorable currency fluctuations persist as a key headwind. Also, increasing investments in international expansions and data centers are an overhang on near-term profitability.
(You can read the full research report on salesforce here >>>).
Shares of Intuit have outperformed the Zacks Computer Software industry over the past year, increasing +31.5% vs. a gain of +14%. Intuit’s fourth-quarter fiscal 2019 results benefited from strong momentum in Online ecosystem revenues and growth in the Consumer business.
The Zacks analyst thinks that impressive growth in its Small Business and Self-Employed is a tailwind. The TurboTax Live offering is also driving strong growth in the Consumer tax business. Solid momentum of the company’s lending product, QuickBooks Capital is a positive. Moreover, the company’s strategy of shifting its business to cloud-based subscription model will help generate more stable revenues over the long run.
However, high costs and expenses remain a major concern. Moreover, the company expects total QuickBooks Online subscriber growth to moderate in the near term as it continues to focus on additional services.
(You can read the full research report on Intuit here >>>).
Enterprise Products’ shares have gained +14.5% year to date, outperforming the Zacks Oil Production Pipeline MLP industry’s increase of +9.5%. Enterprise Products boasts an extensive network of pipelines that spreads across nearly 49,200 miles. Importantly, the pipeline network, which is connected to every major U.S. shale play, provides services to producers and users of commodities by transporting gas, liquids, and refined products.
The Zacks analyst thinks Enterprise is well positioned to generate additional fee-based revenues from growth capital projects of $6 billion that are currently under construction. Recently, the partnership reported strong second-quarter 2019 earnings, aided by record crude transported volumes.
However, gross operating margins were lower from the partnership’s natural gas processing activities. The partnership was also hurt by lower volumes and maintenance works at its NGL fractionation business. Moreover, Enterprise’s balance sheet is more levered than the sector.
(You can read the full research report on Enterprise Products Partners here >>>).
Other noteworthy reports we are featuring today include VMware (VMW), Analog Devices (ADI) and Xcel Energy (XEL).
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2018, while the S&P 500 gained +15.8%, five of our screens returned +38.0%, +61.3%, +61.6%, +68.1%, and +98.3%.
This outperformance has not just been a recent phenomenon. From 2000 – 2018, while the S&P averaged +4.8% per year, our top strategies averaged up to +56.2% per year.
See their latest picks free >>
Note: Our Director of Research 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
salesforce (CRM) Rides on Portfolio Strength and Buyouts
Intuit (INTU) Rides on Growing Adoption of Product Portfolio
Enterprise (EPD) Banks on $6B Midstream Growth Projects
VMware (VMW) Rides on Hybrid Cloud & SaaS, License Bookings
Per the Zacks analyst, VMware is benefiting from robust vSAN, NSX and EUC licensed bookings growth.
Analog Devices (ADI) Banks on Communications Market Momentum
Per the Zacks analyst, Analog Devices is benefiting from continued momentum in the communications market owing to growing adoption of advanced radio systems in 5G infrastructure.
Steady Investments, Improving Economy Aids Xcel Energy (XEL)
Per the Zacks analyst, long-term investment plans, renewable generation and improving economic conditions will strengthen Xcel Energy's existing operations.
HP (HPQ) Rides on Solid Growth in Personal Systems Segment
Per the Zacks analyst, rising demand for Notebooks, Desktops and workstations on the back of product innovation and differentiations is benefiting HP in the PC market.
Synopsys (SNPS) Banks on Strong Product Menu, Contract Wins
Per the Zacks analyst, Synopsys' focus on strengthening its product portfolio is helping it cater to the growing demand in the EDA market.
Teva's (TEVA) Organic Growth Unlikely to Resume in 2019
Though Teva is progressing well with its restructuring activities, the Zacks analyst believes that stability is still some way off.
Expansions to Aid Toll Brothers (TOL), Lower Orders Hurt
Per the Zacks analyst, Toll Brothers will gain from geographic expansions, robust economy, improving demographics and solid job market.
Pipeline Progress to Boost Spectrum Pharma (SPPI)
Per the Zacks analyst, Spectrum's pipeline progress bode well for its prospects. Moreover, target markets represent immense commercial potential.
Steady E&P Activities Aid Murphy Oil's (MUR) Production
Per the Zacks analyst, steady exploration and production, continuous development activities in U.S. and International locations will boost Murphy Oil's performance.
Strong Global Segment to Drive Lamb Weston's (LW) Top Line
Better price/mix and higher volumes have been aiding sales at Lamb Weston's Global segment for a while now. Per the Zacks analyst, strength in this unit remains a tailwind for top line in fiscal 2020.
High Debt, Forex Exposure Hurt Manulife Financial (MFC)
Per the Zacks analyst, Manulife's high debt level has been inducing higher interest expenses. Also, in an attempt to lower its forex exposure, the company has started incurring hedging costs.
Elevated Costs, High Debt Level Hurt Ares Capital (ARCC)
Per the Zacks analyst, continuously increasing costs, mainly due to expansion strategy, will likely hurt Ares Capital's bottom-line growth. Also, high levels of debt remains a concern.
Segment Weakness, Storage Market Challenges Ail Buckeye (BPL)
Per the Zacks analyst, performance of Buckeye Partners will be impacted by challenging conditions for the segregated storage market and weakness in its prime segments.
Xcel Energy Inc. (XEL) : Free Stock Analysis Report
VMware, Inc. (VMW) : Free Stock Analysis Report
Intuit Inc. (INTU) : Free Stock Analysis Report
Enterprise Products Partners L.P. (EPD) : Free Stock Analysis Report
salesforce.com, inc. (CRM) : Free Stock Analysis Report
Analog Devices, Inc. (ADI) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research