Friday June 30 2017
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 Johnson & Johnson (JNJ), AT&T (T), and Lockheed Martin (LMT).These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Johnson & Johnson shares have gained +9.3% over the last year, widely outperforming the large-cap pharma space (up +1.6%). Driving this outperformance is JNJ's diversified business model, deep product pipeline, and financial strength. The potential Actelion buyout, though expensive, is also expected to bolster the company's long-term growth. However, in 2017, growth in J&J's Pharma segment is expected to suffer as key growth drivers have slowed down due to competition. Estimates have remained mostly stable lately ahead of the Q2 results which come out on July 18th. J&J has a positive record of earnings surprises in the recent quarters. In the updated research report issued today, the Zacks analyst discusses the pros & cons of investing JNJ shares at present.
Operators in the U.S. wireless industry have bee suffering lately and AT&T is no different, even though it has done a tad bit better. The stock is down - 11.5% in the year-to-date period vs. -11.9% drop for the Zacks U.S. Wireless industry and -16.8% drop for Verizon (VZ). The saturated wireless market, losses in access lines, operating expenses, regulatory norms and union issues are acting as major headwinds. The company is actively engaged in upgrading its wireless business even as it fends off competitive challenges from other operators in its core business. On the diversification front, AT&T's Time Warner deal has gained the European Union's approval but awaits U.S. Justice Department's nod. The company's attractive dividend, currently yielding 5.1% appears safe, but these are nevertheless uncertain times in the wireless industry.
Lockheed Martin shares have gained +11.6% over the past year, underperforming the aerospace/defense sector, which has gained +24.4% over the same period. However, being the largest defense contractor in the world, Lockheed Martin continues to be a strong cash generator, which, in turn, helps it to take important cash deployment decisions. The Zacks analyst likes the company's solid presence in both domestic and international markets. Further, increased budget for the Department of Defense is expected to boost defense giants like Lockheed Martin. (You can read the full research report onLockheed Martinhere >>> ) .
Other noteworthy reports we are featuring today include Newell Brands (NWL), eBay (EBAY) and SunTrust Banks (STI).
Zacks' 2017 IPO Watch List
Before looking into the stocks mentioned above, you may want to get a head start on potential tech IPOs that are popping up on Zacks' radar. Imagine being in the first wave of investors to jump on a company with almost unlimited growth potential? This Special Report gives you the current scoop on 5 that may go public at any time.
One has driven from 0 to a $68 billion valuation in 8 years. Four others are a little less obvious but already show jaw-dropping growth. Download this IPO Watch List today for free >>
Director of Research
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 Trends and Earnings Previewreports. If you want an email notification each time Sheraz publishes a new article, please click here>>>
Today's Must Read
Per the Zacks analyst, eBay is redesigning its mobile apps, which will boost its push into mobile and pave the way for growth. Sluggish macroeconomic environment however remains a headwind.
Per the Zacks analyst, expected long run growth in Public Service Enterprise's rate base will drive its earnings growth.
The Zacks analyst believes Anadarko Petroleum's premium oil and gas assets located in Delaware and Denver-Julesburg Basins and GOM will enable it to offset the volatile commodity price movement.
Per the Zacks analyst, Crown Castle's efforts to transform itself from a tower company to a fiber provider looks impressive. High customer concentration is likely to affect the company's top line
Nasdaq's growing non-transaction revenue continues to drive organic growth. 2017 operating expense is expected between $1.2 billion and $1.3 billion.
Per the Zacks analyst, International Paper is focusing on high-return capital projects within its core businesses to fuel growth as huge pension debt obligations and dollar strength remain headwinds.
Per the Zacks analyst, easing margin pressure given the gradual rise in interest rates should aid SunTrust's revenues.
The Zacks analyst believes that Milacron's revenues will be supported by market growth, order growth, geographic expansion and new products. Also, its cost-reduction initiatives will boost margins.
Per the Zacks analyst, Newell is on track with Project Renewal Program that aims at generating cost savings and investing the same to boost growth. This is likely to boost earnings in the long run.
Per the Zacks analyst, Allegion's acquisitions of Republic Doors & Frames will expand its product line and distribution footprint while improving operating efficiency.
While IDEXX's CAG business is growing worldwide, the Zacks analyst is concerned about ongoing currency fluxes dragging its overall sales down. Dependence on third-party distributors is a concern.
Per the Zacks analyst, stringent government regulations are likely to erode profitability as compliance increase operating costs. The pricing environment also remains highly competitive.
The Zacks analyst believes Associated Banc-Corp's continuously rising personnel costs is the primary reason for overall higher expenses.