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The Zacks Analyst Blog Highlights: U.S. Bancorp, Duke Energy, Glaxo, Ross Stores and Xylem

Zacks Equity Research

 

For Immediate Release

Chicago, IL – August 26, 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: U.S. Bancorp USB, Duke Energy DUK, Glaxo GSK, Ross Stores ROST and Xylem XYL.

Here are highlights from Friday’s Analyst Blog:

Top Analyst Reports for U.S. Bancorp, Duke Energy and Glaxo

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 U.S. Bancorp, Duke Energy and Glaxo. 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 >>>

U.S. Bancorp’s shares have outperformed the Zacks Major Banks industry over the past three months, gaining +1.9% vs. a decline of -1.4%. Further, the company possesses an impressive earnings surprise history, having beaten expectations in three of the trailing four quarters.

The company’s second-quarter 2019 results reflect elevated interest and fee income, partly mitigated by higher costs and provisions. The Zacks analyst thinks U.S. Bancorp will likely get support from its solid business model, core franchise, relatively higher interest rates and diverse revenue streams.

Further, strategic acquisitions and rising loans and deposit balances have strengthened the company's balance sheet. However, escalating costs due to its ongoing investments in technology and likely increase in legal expenses remain concerns. Also, significant exposure to commercial loans remains a headwind for the company.

Shares of Duke Energy have outperformed the Zacks Electric Power industry in the past year, gaining +12.2% vs +12.1%. Duke Energy ended second-quarter 2019 on a solid note, with both earnings and revenues exceeding expectations. It invests heavily in infrastructure and expansion projects. It expects to invest about $37 billion in its overall growth projects in the 2019-2023-time frame.

The Zacks analyst thinks this investment plan will drive earnings base growth in its combined electric and gas businesses by approximately 6%, over the next five years. However, the company already has a notable long-term debt of $54.3 billion as of Jun 30, 2019, compared with $51.1 billion at 2018 end.

Such massive debt levels can turn out to be a major headwind for the company, going forward. Moreover, cleaner energy generation may lead Duke Energy to incur high environmental compliance costs, which may weigh on its bottom line.

Glaxo’s shares have outperformed the Zacks Large Cap Pharmaceuticals industry year to date, gaining +8.6% versus the industry’s decline of -1.2%. Glaxo’s earnings and sales beat estimates in Q2. The Zacks analyst thinks the company’s three newest products — Trelegy Ellipta, Shingrix and Juluca — are doing well, particularly Shingrix.

These products coupled with restructuring in the Consumer Health unit have strengthened Glaxo’s competitive position. We are encouraged by the company’s initiatives to focus on its oncology pipeline.

However, stiff competition, genericization and pricing pressure on key drugs in the Pharma segment are hurting sales. Particularly, pricing pressure and competitive dynamics are hampering sales of Glaxo’s respiratory products.

Importantly, a generic version of its top-selling drug Advair has been launched, which is significantly eroding the drug’s sales. Also, competitive pressure on HIV drugs is rising in 2019.

Other noteworthy reports we are featuring today include Ross Stores and Xylem.

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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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Duke Energy Corporation (DUK) : Free Stock Analysis Report
 
U.S. Bancorp (USB) : Free Stock Analysis Report
 
GlaxoSmithKline plc (GSK) : Free Stock Analysis Report
 
Xylem Inc. (XYL) : Free Stock Analysis Report
 
Ross Stores, Inc. (ROST) : Free Stock Analysis Report
 
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