Thursday June 8, 2017
Today's Research Daily features new research reports on 16 major stocks, including General Motors (GM), VMware (VMW), and Southwest Airlines (LUV). 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 >>>
General Motors shares have been strong performers over the past year (the stock is up +17% vs. +11.4% for the Zacks Auto sector & -16.6% for Ford), though they have struggled lately. The Zacks analyst likes the company’s capital allocation strategy, investments in plants in the U.S. and emerging markets, product launches and focus on technology development. Moreover, the company's focus on capital deployment is expected to boost shareholder returns. However, the automaker is under pressure due to lower U.S. vehicles sales in 2016, a recent settlement related to the 2014 ignition switch recall and a large fine by China for monopolistic pricing behavior. General Motors’ quarterly earnings estimate has been going up lately.
(You can read the full research report on General Motors here >>>).
VMware shares have gained +17.9% year to date, underperforming the Zacks Software industry (up +21.5%) but outperforming the S&P 500 (up +7.2%). VMware’s revenues continue to register strong growth driven by its innovative product offerings like NSX, AirWatch, vSphere and vSAN. The Zacks analyst likes its innovative product pipeline, strategic partnerships, frequent contract wins and robust international sales. The company continues to benefit from its strength in the virtualization and hybrid cloud market. VMware’s impressive first-quarter results and positive fiscal year guidance (up from the previous guidance) driven by expanding product portfolio, partnerships and continuing enterprise deal wins will help the stock maintain momentum in the rest of fiscal 2018. However lackluster IT spending and mounting competition are headwinds.
(You can read the full research report on VMware here >>>).
Southwest Airlines shares have been standout performers this year; they are up +19.5% in the year-to-date period vs. +11.5% gain for the Zacks Airline industry and +8% gain for the S&P 500 index. The stock's positive momentum has been particularly notable since mid-March, which got a boost from the company's quartelry report when it modestly came short of estimates but raised guidance and announced a dividend hike and raised the buyback authorization.
(You can read the full research report on Southwest Airlines here >>>).
Other noteworthy reports we are featuring today include Johnson Controls (NYSE:JCI), Intuitive Surgical (NASDAQ:ISRG) and ArcelorMittal (MT).
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
Sheraz Mian
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 Preview reports. If you want an email notification each time Sheraz publishes a new article, please click here>>>
Today's Must Read
Featured Reports
Orbital ATK (OA) Gains from New Orders, Backlog up 3%
The Zacks analyst believes new orders of $1.6B, boosted Orbital ATK's backlog to $14.8B. Its R&D expenses are helping to churn new and high quality products assuring a steady flow of orders.
Cabot (COG) Thrives on Marcellus Assets Amid Low Gas Prices
While Cabot's cost management and attractive Marcellus program bode well, the covering analyst would prefer to wait for further natural gas price recovery before recommending investors purchase shares.
Hawaiian Holdings (HA) Unit Revenues Up
The Zacks analyst believes that Hawaiian Holdings continues to gain from unit revenue growth, smoother labor relations and impressive punctuality record with fewer flight cancellations.
MAA (MAA) Gains on Strategic Moves, Market Concentration Pains Remain
Per the Zacks analyst, a well-balanced portfolio and focus on strategic investments should benefit MAA.
United Natural (UNFI) Rides on Margin Expansion Initiatives
Despite competition and deflationary pressure, United Natural's buyout strategies, efforts to grow market share and margin improvement initiatives remain its strength, per Zacks analyst.
Johnson Controls (JCI) Expands, Currency Headwinds Remain
The covering analyst believes that the company will benefit from its ongoing expansions. However, business deconsolidation and currency headwinds are concerns for the company.
Itau Unibanco (ITUB) Reduces Product Risk, Cost Woes Linger
Per the Zacks analyst, strategy to internationalize the bank and focus on less risky products remained a key strength at Itau Unibanco.
New Upgrades
Intuitive (ISRG) Gains from FDA Nod for da Vinci X, Global Growth
The Zacks analyst is bullish on Intuitive Surgical gaining the FDA nod for its prime product da Vinci X following its European CE Mark in April. High international investment is also encouraging.
Pentair (PNR) to Benefit from Industry Strength, Dealer Wins
Per the Zacks analyst, Pentair will gain from industry strength, dealer wins, product innovations and the sale of the Valves & Controls business. Focus on price increases will help mitigate inflation.
Job Cuts, Pipeline Shift to Boost Endocyte's (ECYT) Cash Position
Endocyte's restructuring initiative, including reduction in workforce, and shift in pipeline focus to CAR -T bi-specific adaptor program will boost its cash position, according to the Zacks analyst.
New Downgrades
Donaldson's (DCI) Growth Marred by Weak Gas Turbine Market
The covering analyst thinks Donaldson's sales will continue to be hurt by prolonged weakness in the gas turbine market. Also, soft demand for industrial filtration solutions is making matters worse.
Maxim (MXIM) Weighed Down by Customer Concentration
The Zacks analyst believes that the concentration of Maxim's mobility revenues, which are largely dependent on Samsung (KS:005930), is a concern and could only be mitigated through its diversification strategy.
ArcelorMittal (MT) Cost & Debt Efforts Mired by Weak Demand
While ArcelorMittal should gain from its efforts to cut debt & costs, it remains hamstrung by demand weakness in Europe and China and is still exposed to cheap steel imports, per the Zacks analyst.
Vmware, Inc. (VMW): Free Stock Analysis Report
ArcelorMittal (MT): Free Stock Analysis Report
Southwest Airlines Company (NYSE:LUV
Johnson Controls International PLC (JCI): Free Stock Analysis Report
Intuitive Surgical, Inc. (ISRG): Free Stock Analysis Report
General Motors Company (NYSE:GM
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Zacks Investment Research