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The Zacks Analyst Blog Highlights: Medtronic, United Technologies, Union Pacific, Vertex Pharmaceuticals and NextEra Energy

Zacks Equity Research

For Immediate Release

Chicago, IL – December 31, 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: Medtronic MDT, United Technologies UTX, Union Pacific UNP, Vertex Pharmaceuticals VRTX and NextEra Energy NEE.

Here are highlights from Monday’s Analyst Blog:

Top Research Reports for Medtronic, United Technologies and Union Pacific

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 Medtronic, United Technologies and Union Pacific. 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 >>>

Medtronic’s shares have outperformed the Zacks Medical Products industry year to date (+24.6% vs. +16.8%). The Zacks analyst believes that in recent times, all major business groups at Medtronic contributed to solid top-line growth at CER, which highlighted sustainability across groups and regions, in addition to displaying successful achievement of synergy targets.

In the second quarter fiscal 2019, within RTG, strong sales within spine and brain therapies more than offset slower growth in pain therapies. Within CVG, despite ongoing challenges, the company registered 1.3% growth at CER. MITG arm demonstrated sturdy growth on strength in across all businesses.

The 2020 guidance also looks promising. Medtronic has been outperforming the industry it belongs to for the past three months. On the flip side, the declining CRHF revenue raises concern for Medtronic. Escalating costs persistently put pressure on gross margin.

Shares of United Technologies have gained +12.3% in the past three months against the Zacks Diversified Operations industry’s rise of +12.4%. The Zacks analyst believes that strength in commercial aftermarket and military businesses, coupled with growth in commercial air traffic and high defense spending in the United States, is likely to boost revenues of the company’s aerospace business.

Also, favorable mix in Otis new equipment orders is likely to be a tailwind for the commercial business. However, the company is experiencing softness in its equipment orders at the Carrier segment due to persistent lower transport refrigeration orders. Also, rising cost of sales has been a major cause of concern.

Rise in debt levels can increase its financial obligations. Moreover, the company expects forex headwind to hurt its revenues and segmental operating profits by $550 million and $75 million, respectively, in 2019.

Union Pacific's shares have gained +5.8% over the past six months against the Zacks Rail Services industry's rise of +1.1%. The Zacks analyst impressed with Union Pacific's initiatives to reward its shareholders. Since November 2017, the company raised its quarterly dividend payout five times.

It is also active on the buyback front. Initiatives to control costs to drive the bottom line are also impressive. The company’s operating ratio has been constantly improving mainly owing to its cost-cutting initiatives. Operating ratio is anticipated to improve further. Backed by these tailwinds, shares of Union Pacific have outperformed its industry in a year's time.

However, sluggish overall volumes due to freight-related weakness are a major headwind. Notably, the company issued a lackluster forecast for fourth-quarter 2019 volumes at a conference in December. Union Pacific's escalated debt levels are concerning too. Also, the massive capex might be a headwind.

Other noteworthy reports we are featuring today include Vertex Pharmaceuticals and NextEra Energy.

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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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Union Pacific Corporation (UNP) : Free Stock Analysis Report
NextEra Energy, Inc. (NEE) : Free Stock Analysis Report
United Technologies Corporation (UTX) : Free Stock Analysis Report
Medtronic PLC (MDT) : Free Stock Analysis Report
Vertex Pharmaceuticals Incorporated (VRTX) : Free Stock Analysis Report
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