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The Zacks Analyst Blog Highlights: 3M, Airbus Group NV, Boeing, Chevron, ExxonMobil, Cnooc, Apple, General Electric, HP And Microsoft

Published 09/18/2016, 09:30 PM
Updated 07/09/2023, 06:31 AM

For Immediate Release

Chicago, IL – September 19, 2016 – 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 3M Company (NYSE:MMM) (MMM), Airbus Group (PA:AIR) NV (EADSY), Boeing Company (NYSE:BA) (BA), Chevron Corp. (NYSE:CVX) (CVX), ExxonMobil Corporation (XOM), Cnooc Ltd. (CEO), Apple Inc (NASDAQ:AAPL). (AAPL), General Electric Company (NYSE:GE) (GE ), HP Inc. (HPQ) and Microsoft Corporation (NASDAQ:MSFT) (MSFT).

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

Here are highlights from Friday’s Analyst Blog:

Dow 30 Stock Roundup: Boeing Wins $700M Contract, GE Acquires Meridium

The Dow experienced a chequered week marked by surging volatility. Investor concerns about an imminent rate hike ebbed on Monday, leading to gains. However, slowdown in global oil demand growth dragged down shares on Tuesday. The index moved lower on Wednesday due to a slump in crude-oil prices. An Apple-inspired tech rally, rise in oil prices and reduced expectations of an imminent rate hike helped the Dow gain on Thursday.

Last Week’s Performance

The index gained 1.3% on Monday after investor concerns about an imminent rate hike ebbed. Federal Reserve Governor Lael Brainard said that it would be wise for the Fed to keep monetary policy loose. Muted inflation and uncertain global developments made her cautious against hiking rates too fast. Two other officials also said that the Fed shouldn’t be in a hurry to raise rates.

The index declined 1.4% on Tuesday on Tuesday mostly dragged down by energy shares. Slowdown in global oil demand growth weighed on oil prices. According to the IEA, demand for global oil sank to 800,000 barrels per day (bpd) in the third quarter of this year. IEA also trimmed its 2016 demand growth forecast by 100,000 bpd to 1.3 million bpd.

The IEA said that demand growth has very nearly vanished in developed countries, while it slowed down drastically in Asian powerhouses such as China and India. Investors also remain on the edge as Fed officials differ on rate hike expectations. The VIX rose 18% to close at 17.85, implying that investors foresee further downward swings in the stock market.

The index lost 0.2% on Wednesday due to a slump in crude-oil prices. Increase in stockpiles of gasoline and distillates, including heating oil and diesel fuel adversely affected oil prices. Meanwhile, Libyan officials confirmed that they plan to load the first crude-oil cargo in almost two years from Ras Lanuf.

Dow components such as Chevron Corp. (CVX) and Exxon Mobil Corp (NYSE:XOM). (XOM) dropped 1% and 0.7%, respectively. Shares of Apple Inc. ( AAPL) climbed 3.5%, with its market capitalization topping $600 billion for the first time since April as investors believe that its new iPhone would shore up sales.

The index gained almost 1% on Thursday following an Apple-inspired tech rally, rise in oil prices and reduced expectations of an imminent rate hike. News that the first set of iPhone 7 were sold out globally helped Apple’s shares jump 3.4% to $115.57 on Thursday, its highest close since December. The iPhone maker registered its first four-day winning streak with successive gains over 2% since Apr 2009.

Meanwhile, retail sales and industrial activity fell more than expected last month, while manufacturing activity slumped and jobs growth slowed down. All these discouraging results lowered expectations that the Fed would hike rates at its next meeting.

Components Moving the Index

3M Company (MMM) recently inked a definitive agreement to divest its temporary protective films business to Pregis LLC, a leading global provider of innovative protective packaging materials, for an undisclosed amount. Despite annual global sales of approximately $50 million, Zacks Rank #3 (Hold) rated 3M decided to divest the unit as it was deemed to be a non-core business in its strategic portfolio review.

The transaction is expected to be completed by the year end, subject to mandatory closing conditions and regulatory approvals. About 90 employees of the divested entity are expected to join Pregis, following the completion of the sale procedure. (Read: 3M to Divest Protective Films Business, Shares Falter )

The Boeing Company’s (BA) Defense, Space and Security division recently won an indefinite-delivery/indefinite-quantity foreign military sales (FMS) contract from the Pentagon for the production of Small Diameter Bomb Increment I (SDB I) weapons systems. Valued at $700 million, the contract was awarded by the Air Force Life Cycle Management Center, Eglin Air Force Base, FL. (Read: Boeing Wins $700M FMS Contract from Air Force for SDB I )

Meanwhile, In a bid to compete against Airbus Group NV’s (EADSY) longest single-aisle jet – A321neo, Zacks Rank #3 rated Boeing is analyzing two potential designs for a longer version of its existing 737 Max 9 model, as per a recent report by Bloomberg. The new model, to be named Max 10, will be the largest aircraft in Boeing’s 737 product line. (Read: Boeing to Redesign 737 Max 9 to Vie with Airbus A321neo )

ExxonMobil Corp. (XOM) and Oil Search Ltd. recently signed a deal with Gini Energy, a company controlled by China’s Cnooc Ltd. (CEO), to acquire majority interest in two deepwater exploration acreages in the Gulf of Papua.

Under the terms, Oil Search and Zacks Rank #3 rated ExxonMobil will purchase 40% stake each in two exploration licenses from Gini Energy. ExxonMobil will become operator of the licenses, while Gini Energy will retain 20% equity holding.

The two licenses, namely PPL 373 and PPL 375, are situated roughly 150 kilometers south of Port Moresby. They cover a combined 24,936 kilometers, with water depths ranging from 1000 meters to 2500 meters. (Read: Exxon, Oil Search to Buy 40% Stake in Gulf of Papua Acreage )

General Electric Co. (GE) unit GE Digital, recently acquired Meridium, Inc., a global leader in asset performance management (APM) software and services for asset-intensive industries. The transaction marks a logical extension to its long-standing relationship with Meridium since Jul 2014, wherein it acquired a 26% ownership stake in it. The total acquisition, including the original investment, was worth an enterprise value of $495 million.

GE Digital will utilize its Predix platform along with Meridium’s enterprise software solutions to improve the APM offering through advanced asset-centric analytics, industrial software and value-added services. The Predix software of Zacks Rank #2 (Buy) rated General Electric is designed to add intelligence to the Internet of Things applications. (Read: GE Digital Acquires Meridium to Boost Industrial Internet )

Microsoft Corp. (MSFT) is gradually gaining traction in the Customer Relationship Management (CRM) space. The company recently announced that it has entered into a six-year agreement with HP Inc. ( HPQ) for the deployment of Microsoft Dynamics CRM Online at its sales, marketing and service units.

Although Microsoft did not divulge the details of the agreement, we believe the HP-deal is a major win as it demonstrates the company’s growing clout in the cloud CRM market. The stock holds a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

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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.



3M CO (MMM): Free Stock Analysis Report

AIRBUS GROUP NV (EADSY): Free Stock Analysis Report

BOEING CO (BA): Free Stock Analysis Report

CHEVRON CORP (CVX): Free Stock Analysis Report

EXXON MOBIL CRP (XOM): Free Stock Analysis Report

CNOOC LTD ADR (CEO): Free Stock Analysis Report

APPLE INC (AAPL): Free Stock Analysis Report

GENL ELECTRIC (GE): Free Stock Analysis Report

HP INC (HPQ): Free Stock Analysis Report

MICROSOFT CORP (MSFT): Free Stock Analysis Report

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