Wednesday, July 25, 2018
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 Bank of America (BAC), BP Plc (BP) and Lockheed Martin (LMT). 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 >>>
Bank of America 's shares have outperformed the Zacks Major Regional Banks industry year to date, gaining +4.5% vs. +1%. Also, the company possesses an impressive earnings surprise history, beating expectations in each of the trailing four quarters.
The company's second-quarter 2018 earnings were supported by higher net interest income, card income and trading income. A fall in operating costs was also a positive. However, investment and mortgage banking fees declined.
The Zacks analyst thinks rise in loan and deposit balances, interest rates and efforts to manage expenses as well as expand into new markets will support profitability. Also, lower tax rates and easing of banking regulations will aid growth.
Further, approval of its capital plan reflects strong balance sheet position. However, fall in mortgage banking income due to lower volumes and a decline in refinancing activity along with uncertainty related to performance of capital markets remain major concerns.
(You can read the full research report on Bank of America here >>> ).
Shares of BP are up +28.7% over the last year, outperforming the Zacks International Integrated Oil industry (up +19.2%). The integrated energy company has been gaining on the back of a strong portfolio of upstream projects.
Since 2016, BP has placed 15 key upstream projects online, including Atoll Phase 1 & Shah Deniz 2. All those developments are backing the British energy giant to boost production by 900 thousand barrel of oil equivalent per day (MBOE/D) by 2021.
Moreover, the company has a strong commitment in returning cash back to the shareholders through share buybacks and dividend payments. However, the oil spill incident of 2010 in the BP-operated Macondo prospect continues to affect the company. BP anticipates cash out flow related to the incident of $3 billion through 2018 against the prior projection of slightly more than $2 billion.
(You can read the full research report on BP here >>> ).
Buy-ranked Lockheed Martin 's shares have gained +0.5% year to date, underperforming the Zacks Aerospace Defense sector, which has gained +9.3% over the same period. But Lockheed Martin ended second quarter 2018 on an impressive note, with both its top and bottom-line having comfortably surpassed expectations.
Being the largest defense contractor in the world, Lockheed Martin experiences strong demand for its high-end military equipment in domestic as well as international markets. Consequently, strong order growth has been a primary growth driver for this company.
The Zacks analyst thinks Lockheed Martin continues to be a strong cash generator, helping it to take important cash deployment decisions. The recent adoption of expansionary budgetary policies in the United States will immensely boost this defense prime's business growth. However, the company faces intense competition for its broad portfolio of products and services in both domestic and international markets.
(You can read the full research report on Lockheed Martin here >>> ).
Other noteworthy reports we are featuring today include V.F. Corp. (VFC), Halliburton (HAL) and Rogers Communications (RCI).
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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 Trendsand 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 BofA (BAC), Low Fee Income a Woe
BP Plc (BP) Banks on Upstream Projects Amid Oil Spill Woes
Solid Order Growth, Favorable Budget Boost Lockheed (LMT)
Tight Pressure Pumping Market to Boost Halliburton (HAL)
The Zacks analyst believes that strong pressure pumping activity will help Halliburton's completion and production unit margins but is concerned about slowdown in Permian Basin activity.
Solid Momentum in Vans Brand Aids Growth at V.F. Corp (VFC)
Per the Zacks analyst, V.F. Corp's Vans brand is displaying strength globally with double-digit growth across all regions and product categories.
Wireless Subscriber Growth Aids Rogers Communications (RCI)
Per the Zacks analyst, solid subscriber gain in wireless segment and increasing Internet user count is benefiting Rogers Communications.
Strong Volumes Aid Kansas City Southern (KSU) Amid Cost Woes
The Zacks analyst likes the company's impressive volume growth.
Buyouts & Products to Aid Stanley Black (SWK), Costs A Drag
Per a Zacks analyst, Stanley Black & Decker stands to gain from buyout of Nelson Fastener's unit and rising adoption of Craftsman, Lenox, Irwin and other products.
Loan Growth Aids Bank OZK's (OZK) Revenues, High Cost a Woe
Per the Zacks analyst, growth in loans along with de novo branching strategies is expected to drive Bank OZK's revenues.
Rise in Interest Income Aids Synovus (SNV), High Costs A Woe
Per the Zacks analyst, Synovus is well poised to enhance its interest income driven by steady growth in loan demand and gradual economy recovery.
Skyworks (SWKS) Rides on 5G Product Suite & LTE Solutions
Per the Zacks analyst, Skyworks' growing clout in the connectivity solutions and 5G markets is a positive. Higher demand for LTE solutions along with product rollouts will drive its top-line growth.
Solid Premiums, Inorganic Growth Aid WellCare Health (WCG)
Per the Zacks analyst, WellCare continues to benefit from inorganic growth through strategic partnerships and acquisitions along with organic growth driving premiums.
Alliance Data (ADS) Poised to Grow on Solid Card Service
Per the Zacks analyst, Alliance Data is poised for growth on strong performance of Card Service that in turn is fueled by growth in average credit card receivable portfolio.
Rising Expenses, Customer Concentration Hurts Buckeye (BPL)
Per the Zacks analyst, rising debt expenses and Buckeye Partners' dependence on limited group of customers for bulk of its storage revenues are headwinds.
JetBlue Airways (JBLU) Stung by High Fuel Costs
The Zacks analyst is concerned about the rise in fuel costs, which have been limiting bottom-line growth. Moreover, unit revenue-related woes and declining air fares are also hurting the company.
High Debt & Rising Competition Mar POSCO (PKX) Prospects
The Zacks analyst is apprehensive about POSCO's high debt levels. Also, stiff competition from global steel manufacturers with expanded production capacity remains a concern.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free reportV.F. Corporation (VFC): Free Stock Analysis ReportRogers Communication, Inc. (RCI): Free Stock Analysis ReportLockheed Martin Corporation (LMT): Free Stock Analysis ReportHalliburton Company (HAL): Free Stock Analysis ReportBP p.l.c. (BP): Free Stock Analysis ReportBank of America Corporation (BAC): Free Stock Analysis ReportTo read this article on Zacks.com click here.