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Top Stock Reports for U.S. Bancorp, Bristol-Myers Squibb & Morgan Stanley

Mark Vickery

Tuesday, October 22, 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 U.S. Bancorp (USB), Bristol-Myers Squibb (BMY) and Morgan Stanley (MS). 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 >>>

U.S. Bancorp’s shares have outperformed the Zacks Major Banks industry year to date (22.6% vs. 21.9%). The Zacks analyst believes that U.S. Bancorp’s solid business model, core franchise and diverse revenue streams are expected to continue supporting its performance.

The company possesses an impressive earnings surprise history, having beaten the Zacks Consensus Estimate in three of the trailing four quarters. Third-quarter results benefited from higher revenues and loan growth. Further, rising loans and deposit balances have strengthened the company's balance sheet, enabling it to undertake strategic acquisitions.

Moreover, improved credit quality is a tailwind for the company. However, escalating costs due to its ongoing investments in technology and the likely increase in legal expenses remain concerns. Also, significant exposure to commercial loans remains a headwind for the company.

(You can read the full research report on U.S. Bancorp here >>>)

Shares of Bristol-Myers have gained 16.6% in the past six months against the Zacks Large Cap Pharmaceuticals industry’s rise of 2.4%. The Zacks analyst believes that Bristol-Myers’ lead immuno-oncology drug, Opdivo, continues to drive growth. Label expansion of the drug into additional indications should boost the top line. Empliciti and Sprycel are also performing well on label expansions.

Moreover, Bristol-Myers also has presence in other core therapeutic areas, including immunoscience and cardiovascular. Blood thinner drug, Eliquis, is also expected to drive growth. Meanwhile, the impending acquisition of Celgene will broaden the company’s oncology portfolio with the addition of Revlimid.

However, pipeline setbacks are a concern. The failure of the part 2 of the Checkmate-227 study was disappointing, given the potential in the NSCLC market. Earnings estimates are stable ahead of third-quarter results. 

(You can read the full research report on Bristol-Myers here >>>)

Morgan Stanley’s shares have lost 1% over the past three months against the Zacks Investment Banking industry’s decline of 5.9%. The Zacks analyst believes the acquisition of Solium Capital is in sync with the company’s efforts to further strengthen its wealth management business.

The company has an impressive earnings surprise history, having surpassed the Zacks Consensus Estimate in three of the trailing four quarters. Its third-quarter 2019 results show improvement in trading and investment banking operations.

Its focus on corporate lending business, steady loan growth and strong balance sheet will continue to aid profitability. However, weaknesses in investment banking and trading are expected to hinder fee income growth and the top line. Also, given the expectation of more rate cuts and a tough operating backdrop, the company’s performance is expected to remain sluggish in the near term.

(You can read the full research report on Morgan Stanley here >>>)

Other noteworthy reports we are featuring today include TOTAL (TOT), Bank of America (BAC) and Gilead Sciences (GILD).

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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

Loan Growth Supports U.S. Bancorp (USB), Higher Costs a Woe

Strong Opdivo Fuels Bristol-Myers (BMY) Amid Competition

Wealth Management Aids Morgan Stanley (MS), Fee Income a Woe

Featured Reports

New Branches, Digital Focus Aid BofA (BAC) amid Lower Rates

Per the Zacks analyst, BofA's branch expansion efforts, loan growth and focus on digital offerings will support revenues, while lower rates and weak capital markets performance remain key headwinds.

HIV Business Fuel Gilead (GILD), Pipeline Setbacks A Concern

Per the Zacks analyst, Gilead's HIV franchise maintains momentum on new approvals as HCV business dwindles.

Investment Plan Aids Duke Energy (DUK), Commodity Prices hurt

Per the Zacks Analyst, the company's robust five-year capital plan will drive earnings base growth.

Investments and Clean Energy Focus Aid Dominion Energy (D)

Per the Zacks analyst Dominion's plans to invest $26 billion in the 2019-2023 time period to strengthen infrastructure and generate more electricity from clean sources will boost its performance.

Expansion Strategy Boosts Equinix (EQIX) Amid Stiff Competition

Per the Zacks Analyst, the IBX expansion strategy will strengthen Equinix's global footprint in the data-center space.

Portfolio Revamp, Expansion to Aid Simon Property (SPG)

Per the Zacks Analyst, Simon Property is likely to benefit from new development, redevelopment, expansion and acquisition efforts.

Rising Export of Refined Petroleum Product Aids Valero (VLO)

Valero will gain from rising refined petroleum product export volumes, as majority of its refining plants are situated in the U.S. Gulf Coast. A drop in throughput volumes vexes the Zacks analyst.

New Upgrades

Allstate (ALL) Rides on Strong Property-Liability Segment

Per the Zacks analyst, premium growth in the Property-Liability Segment remains strong owing to pricing discipline and strong claims management that has contributed to topline growth.

Buyouts, Omni-Channel to Fuel Capri Holdings' (CPRI) Sales

Per the Zacks analyst, deployment of resources to make accretive buyouts, upgrade distribution infrastructure and e-commerce platform, and expand product offerings bode well for Capri Holdings' sales.

Transformation Plan to Aid NRG Energy (NRG) Via Cost savings

Per the Zacks analyst, cost-saving through Transformation Plan, acquisitions as well as share buyback strategy will support NRG Energy's long-term growth objectives.

New Downgrades

Fluctuating Commodity Prices, Competition Hurt TOTAL (TOT)

Per the Zacks analyst TOTAL's presence in more than 130 countries exposes it to competition at local and international levels, in addition fluctuating hydrocarbon prices is also hurting the company.

Falling Margins & Macroeconomic Woes Hurt Palo Alto (PANW)

Per the Zacks analyst, continued acquisitions and heavy investments in marketing are hurting the company's operating margin. Also, U.S. tariffs on Chinese goods is an overhang on the bottom line.

Weaker Steel Prices to Weigh on Cleveland-Cliffs (CLF)

Per the Zacks analyst, falling U.S. steel prices, partly due to weaker demand, will hurt Cleveland-Cliffs' pellet price realization rate and dent its margins.

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U.S. Bancorp (USB) : Free Stock Analysis Report
TOTAL S.A. (TOT) : Free Stock Analysis Report
Morgan Stanley (MS) : Free Stock Analysis Report
Gilead Sciences, Inc. (GILD) : Free Stock Analysis Report
Bristol-Myers Squibb Company (BMY) : Free Stock Analysis Report
Bank of America Corporation (BAC) : Free Stock Analysis Report
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