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The Zacks Analyst Blog Highlights: Berkshire Hathaway, Apple, Goldman Sachs Group, United Parcel Service, Verizon Communications and Phillips 66

Zacks Equity Research
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For Immediate Release

Chicago, IL – August 9, 2018 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Berkshire Hathaway Inc. BRK.B, Apple Inc. AAPL, The Goldman Sachs Group, Inc. GS, United Parcel Service Inc. UPS, Verizon Communications Inc. VZ and Phillips 66 PSX.

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

Here are highlights from Wednesday’s Analyst Blog:

Boost Portfolio Returns With These 5 Warren Buffet Picks

The Oracle of Omaha has reason to feel happy. Berkshire Hathaway Inc. posted blowout results on Aug 4, with second-quarter earnings surging 182% year-over-year on a reported basis. Some analysts have been skeptical of these results since it takes into account unrealized gains from the company’s stock portfolio into account.

But Berkshire did show overall improvement during the second quarter. Importantly, the company took a major step by allowing its management to tackle the lingering problem of its massive cash pile.

Earnings Reflects All-Round Strength

Berkshire reported adjusted second-quarter 2018 earnings of $6.9 billion, soaring 67.3% year over year. This improvement was mainly attributable to solid results across all segments. Revenues increased 8.6% year over year to $62.2 billion. Pretax income came in at $15.1 billion, surging 146% year over year.  (Read: Berkshire Q2 Earnings Rise on Segmental Strength)

At the reported quarter-end, cash, cash equivalents and the U.S. Treasury bills were approximately $111.1 billion. This represents a quarterly increase of $2 billion. Ultimately, this is a long-standing concern for Berkshire and its shareholders. However, the recently amended buyback program should soon address this issue.

Apple Mints Money for Buffet’s Portfolio

A section of analysts have indicated that since March 2009, Berkshire has failed to significantly outperform the Dow and S&P 500. But this fails to negate the fact that Berkshire has yielded a staggering return of more than 700% since inception. In any case, Buffet believes in purchasing shares of great companies and holding them for a considerable period of time. (Read: 4 Warren Buffett Stocks to Buy in Q2 Earnings)

At this point, Buffet’s largest stake is in Apple Inc. and he has minted billions from this investment. Berkshire mentioned in its second quarter earnings release that its stake in Apple was worth $47.2 billion as of June 30, 2018.

Our Choices

Berkshire has delivered a stunning second quarter earnings performance, reflecting all-round strength. Skeptics think that the stock has failed to outperform the market significantly in recent times. But Berkshire’s long-term performance is outstanding and Buffet retains his legendary reputation as one of Wall Street’s best minds.

Adding some of Buffet’s stock picks to your portfolios makes for a smart move. We have narrowed our search to the following stocks based on a Zacks Rank #2 (Buy) and other relevant metrics. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Apple third-quarter fiscal 2018 results created new records in a seasonally slow period. Earnings of $2.34 per share not only crushed the Zacks Consensus Estimate by 17 cents but also surged 40.4% year over year.

Apple’s expected earnings growth for the current year is 26.8%. The Zacks Consensus Estimate for the current year has improved by 2.5% over the last 30 days.

The Goldman Sachs Group, Inc.’s second-quarter 2018 results recorded a positive earnings surprise of 28.1%, reflecting the highest strong second-quarter net revenues in nine years.

Goldman Sachs’ expected earnings growth for the current year is 26.4%. The Zacks Consensus Estimate for the current year has improved by 7.1% over the last 30 days.

United Parcel Service Inc. reported second-quarter 2018 earnings (excluding 23 cents from non-recurring items) of $1.94 per share, surpassing the Zacks Consensus Estimate of $1.92. Earnings increased 22.8% on a year-over-year basis.

United Parcel’s expected earnings growth for the current year is 20.7%. The Zacks Consensus Estimate for the current year has improved by 0.3% over the last 30 days.

Verizon Communications Inc. continued its solid performance in second-quarter 2018, primarily led by the wireless business. The company recorded healthy top-line growth led by solid service revenues.

Verizon’s projected growth rate for the current year is 24.3%. The Zacks Consensus Estimate for the current year has improved by 1.4% over the last 30 days.

Phillips 66 posted second-quarter 2018 adjusted earnings of $2.80 per share, which surpassed the Zacks Consensus Estimate of $2.16. The bottom line increased from the year-ago quarter’s figure of $1.09. The upside came on the back of higher contribution from all the segments.

Phillips 66’s expected earnings growth for the current year is 72.9%. The Zacks Consensus Estimate for the current year has improved by 8% over the last 30 days.

More Stock News: This Is Bigger than the iPhone!

It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.

Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020. Click here for the 6 trades >>

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1 Stock of the Day pick for free.

About Zacks Equity Research

Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

Strong Stocks that Should Be in the News

Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year. See these high-potential stocks free >>.

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.


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Verizon Communications Inc. (VZ) : Free Stock Analysis Report
 
Apple Inc. (AAPL) : Free Stock Analysis Report
 
The Goldman Sachs Group, Inc. (GS) : Free Stock Analysis Report
 
Berkshire Hathaway Inc. (BRK.B) : Free Stock Analysis Report
 
Phillips 66 (PSX) : Free Stock Analysis Report
 
United Parcel Service, Inc. (UPS) : Free Stock Analysis Report
 
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