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The Zacks Analyst Blog Highlights: Comcast, Ecolab, General Dynamics, Illinois Tool Works and O'Reilly Automotive

Zacks Equity Research

For Immediate Release

Chicago, IL – August 1, 2019 – 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: Comcast CMCSA, Ecolab ECL, General Dynamics GD, Illinois Tool Works ITW and O'Reilly Automotive ORLY.

Here are highlights from Wednesday’s Analyst Blog:

Top Stock Reports for Comcast, Ecolab and General Dynamics

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 Comcast, Ecolab and General Dynamics. 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 >>>

Comcast’s shares have underperformed the Zacks Cable Television industry in the past three months, gaining +1.5% vs. +2.9%. Comcast’s second-quarter 2019 results were driven by Cable’s solid performance. The segment benefited from expanding residential high-speed Internet customer base and business services user base.

Moreover, increase in wireless user base, and expansion in the security and automation services customer base drove results. Further, Theme Parks revenues grew significantly in the reported quarter. Although Sky’s top line declined, subscriber base expanded.

Meanwhile, Comcast continues to lose video subscribers due to cord-cutting. However, its focus to add subscribers aided profitability. This also prompted the company to increase Cable EBITDA margin guidance for 2019. Nevertheless, a high debt level remains a headwind.

Shares of Ecolab have gained +39.6% year-to-date, outperforming the Zacks Specialty Chemicals industry which has increased +22.4% over the same period. Ecolab ended the second quarter on a tepid note.

The Zacks analyst thinks the company continues to gain from its core Global Industrial and Global Institutional units. Strength in Pest Control and Colloidal technologies in the quarter drove its Other unit. Management is optimistic about the spin-off of its Upstream Energy business as a stand-alone publicly-traded company and acquisitions, which are likely to prove beneficial in the quarters to come.

Ecolab’s cost-efficiency initiative is expected to result in approximately $200 million of SG&A savings by 2021. Expansion in operating margin is encouraging as well. However, softness in the Global Energy arm raises concerns.

Quarterly EPS was impacted by unfavorable currency movement. In fact, management expects adverse foreign exchange impact to mar EPS in the quarters to come. A highly competitive market adds to its woes.

General Dynamics’s shares have gained +7.2% in the past three months, outperforming the Zacks Aerospace & Defense industry's increase of +2.7%. General Dynamics ended second-quarter 2019 on a solid note, with both earnings and revenues having surpassed their respective expectations.

The Zacks analyst thinks the company boasts a strong position in the U.S. defense space and overseas, and continues to witness strong order growth, securing pivotal contracts from the U.S. government and overseas clients. Deliveries of G600 can be expected from the third quarter. However, rising interest expenses can be a potential headwind for the company’s bottom-line growth going ahead.

Moreover, delayed payments related to one of its large international vehicle programs in Canada are hurting its cash flow reserves. A comparative analysis of its historical EV/EBITDA ratio depicts a gloomy picture.

Other noteworthy reports we are featuring today include Illinois Tool Works and O'Reilly Automotive.

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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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General Dynamics Corporation (GD) : Free Stock Analysis Report
 
O'Reilly Automotive, Inc. (ORLY) : Free Stock Analysis Report
 
Comcast Corporation (CMCSA) : Free Stock Analysis Report
 
Ecolab Inc. (ECL) : Free Stock Analysis Report
 
Illinois Tool Works Inc. (ITW) : Free Stock Analysis Report
 
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