Wednesday, July 27, 2016
Today's must-read reports are for Texas Instruments (NASDAQ:TXN) (TXN), Express Scripts (ESRX) and Stanley Black & Decker (NYSE:SWK) (SWK).
Zacks Rank # 2 (Buy) rated Texas Instruments shares are up more than 20% year-to-date, with the stock getting a boost from the strong Q2 earnings report. The analyst likes the fact that margins expanded and thinks they should continue to grow. This will be attributable to the secular strength in the auto and industrial markets, a stronger mix of analog and embedded processing products, benefits of restructuring actions and more 300mm capacity coming online. (You can read the full research report on TXN here.)
Express Scripts, the pharmacy benefits manager, posted mixed results for the June quarter - beating on earnings, but coming up short on the top-line and trimming expectations for the rest of the year. The guidance cut appears to be a function of the contract dispute with Anthem, one of its largest customers. These issues notwithstanding, the company remains well placed given its ability to pursue deals, increased generic utilization, shift towards mail orders, strong specialty growth and an aging population. (You can read the full research report on ESRX here.)
Buy-rated Stanley Black & Decker shares have gained more than 13% year to date on the back of improving consumer and housing trends. The company's strong Q2 results should help sustain this momentum. The analyst likes the stock’s significant long-term upside potential, backed by a strategy of shifting its business portfolio toward favored growth markets. Also, the company remains committed to returning excess cash to shareholders. (You can read the full research report on SWK here.)
Other noteworthy reports we are featuring today include Honeywell (HON), V.F. Corp. (VFC) and Reynolds (RAI).
- Honeywell’s (HON) Growth Prospects Bright
- V.F. Corp.’s (VFC) Q2 Earnings Impress
- Chesapeake (CHK) Upgraded to Zacks Rank # 2 (Buy)
- Reynolds (RAI) Downgraded to Zacks Rank # 4 (Sell)
You can find all of today's stock research reports here.
Sheraz Mian
Director of Research
Note: Sheraz Mian regularly provides earnings analysis on Zacks.com and appears frequently in the print and electronic media. His weekly earnings related articles include Earnings Trends and Earnings Preview. He also provides weekly commentary to Zacks Premium subscribers and manages the Zacks Focus List and Top 10 portfolios.
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Today's Must Read
Featured Reports
Honeywell (HON) Poised for Healthy Long-Term Growth
The analyst thinks the company's diversified business portfolio has the potential to earn steady above-average returns.
V.F. Corp. (VFC) Tops Q2 Earnings, Revises 2016 Outlook
V.F. Corp.'s second quarter 2016 results highlight the strength of its brands, according to the covering analyst.
Whirlpool (NYSE:WHR) Q2 Earnings Beats, Updates Outlook
The Zacks analyst thinks Whirlpool's robust second-quarter 2016 performance underscores progress on its growth initiatives and its track record of positive earnings surprises.
Tesla (NASDAQ:TSLA) Opens Partly-Constructed Gigafactory
Tesla has opened its partly-constructed Gigafactory in Nevada as per plan. This indicates that efforts to ramp up production volume are on track, according to the covering analyst.
Vulcan Materials (VMC) Experiencing Strong Aggregates Demand
Construction activity and demand for aggregates continue to recover in both private and public sector which, coupled with strong pricing momentum, should support revenues in Q2, per the Zacks analyst.
Coach's (COH) Transformational Initiatives Bode Well
The covering analyst thinks Coach's transformational initiatives related to products, stores and marketing will help it return to the growth trajectory and emerge as a multi-brand company.
NuVasive (NUVA) Tops Q2 Earnings, Raises FY16 View
The Zacks analyst believes NuVasive's strong Q2 results indicate robust growth in core U.S. spinal hardware and international business.
New Upgrades
Chesapeake (CHK) Poised to Benefit with Upside in Gas
The Zacks analyst likes Chesapeake's leading position among the top unconventional liquids-rich plays and as one of the most gas weighted E&Ps. Focus on cost cut efforts is another positive.
Discovery's (DISCA) Recent Collaborations Expected to Boost Growth
Discovery's top-line should see growth given commendable agreements with popular entertainment industry names such as Hulu, Mediacom and the Hub Network, according to the covering analyst.
Strong Position in MS Market to Drive Biogen's (NASDAQ:BIIB) Growth
The Zacks analyst likes Biogen's strong position in the MS market as well as its efforts to develop the pipeline. Cost cutting efforts and MS franchise sales should help Biogen achieve its guidance.
New Downgrades
Reynolds' (RAI) Earnings and Sales Miss Estimates in Q2
Reynolds' missed the Zacks Consensus Estimate for both earnings and revenues in Q2. However both the bottom line and top line improved year over year backed by positive pricing and higher sales.
DaVita (DVA) Hurt by High Cost, Health Care Reform Uncertainty
The Zacks analyst thinks high debt levels, leading to an increase in interest expenses, adverse effects of Health Care Reform, Medicare Advantage reimbursements are cause for concern.
SIRIUS XM (SIRI) Downgraded due to Q2 Earnings Miss
The covering analyst thinks SIRIUS XM's earnings miss and rising competition are major concerns. However revenues impressed in Q2 and the company raised views for 2016.
V F CORP (VFC): Free Stock Analysis Report
TEXAS INSTRS (TXN): Free Stock Analysis Report
STANLEY B&D INC (SWK): Free Stock Analysis Report
REYNOLDS AMER (RAI): Free Stock Analysis Report
HONEYWELL INTL (HON): Free Stock Analysis Report
EXPRESS SCRIPTS (ESRX): Free Stock Analysis Report
CHESAPEAKE ENGY (CHK): Free Stock Analysis Report
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Zacks Investment Research