Monday June 26 2017
The Zacks Research Daily presents the best research output of our analyst team. Today's Research Daily features new research reports on 12 major stocks, including United Technologies (UTX), Intel Corp (INTC) and Kraft Heinz (KHC).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 >>>
Buy rated United Technologies shares have outperformed the Zacks Conglomerates sector as well as the S&P 500 index in the year-to-date period (the stock is up +11.3% vs. +2.4% gain for the sector) on the back of a revamped aerospace unit and improved growth outlook through strategic acquisition opportunities. While questions remain about the new administration's ability to ramp up defense spending, this favorable expectation is nevertheless a positive for the company. The improving outlook for the global economy is another macro tailwind for UTX. The company remains in excellent financial health and pays a stable dividend (currently yielding 2.2%), but value-oriented investors will likely have issues with the stock's current elevated valuation.
(You can read the full research report on United Technologies here >>>).
Shares of Intel have lost -1.6% since election results were announced on Nov 8, in contrast to the broader Tech sector (up +16.5%) as well as the red-hot semiconductors space (up +23.2%). Top-PC makers like HP, Lenovo, and Asus are set to launch PCs based on Qualcomm’s ARM-based Snapdragon processor, which intensifies competition for Intel. Additionally, increasing competition from AMD is also a headwind. Nevertheless, the Zacks analyst thinks IBM’s upcoming launch of Skylake will drive data center results in the second half. Also, the company revised its 2017 revenue and EPS outlook upward based on improving average selling price (ASP). Further, anticipated improvement in cost structure and lower spending, primarily due to improving operational efficiency will aid in expansion of margins going forward. Additionally, aggressive share buyback will boost the bottom line in 2017.
(You can read the full research report on Intel here >>>).
Kraft Heinz’s shares have gained +1.9% year to date, outperforming the categorized Food-Miscellaneous/Diversified industry which is down -3.7% during the same period. Strong brand portfolio, cost savings initiatives, innovation and marketing efforts raise growth prospects for the company. However, the company is seeing top-line weakness over the past several quarters. The Zacks analyst stresses that Kraft Heinz has been struggling due to the shift in consumer preference toward natural and organic ingredients over packaged and processed food. Again, unfavorable currency translation is a major headwind for Kraft Heinz that is likely to hurt results in 2017.
(You can read the full research report on Kraft Heinz here >>>).
Other noteworthy reports we are featuring today include HCA Holdings (HCA), Red Hat (RHT) and EQT Corp. (EQT).
Want to see all of today's Zacks Strong Buys?
Today's 5 additions are just the appetizer. You are welcome to download the full, up-to-the-minute list of 220 Zacks Rank #1 stocks free of charge. There is no better place to start your own stock search. Plus you can also access the full list of must-avoid Zacks Strong Sells and other private research. See the stocks free >>
Brian Hamilton
Research Investment Coordinator
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
EQT Corp. (EQT) to Boost its Marcellus Shale Footprint
EQT Corp.'s Rice Energy buyout will likely boost its footprint in the Marcellus shale play. However, the company's sole exposure to the Appalachian Basin poses risks, according to the Zacks analyst.
Subscriber Gain Lifts U.S. Cellular (USM)
Per the Zacks analyst, rollout of 4G LTE and introduction of LTE handsets boosts the subscriber base, while threat posed by competitors' lower-cost mobile service plans is a woe.
SunPower (SPWR) Gains on Shift to Solar Project Development
Per the Zacks analyst, SunPower is gradually shifting its revenue base from solar panel sales to the development of solar projects, power plants and EPC systems.
Red Hat (RHT) Banks on Strong Deal Win, Recurring Revenues
According to the Zacks analyst, Red Hat is benefiting from strong deal win, improving recurring revenues and cross-selling of cloud-based technology.
HCA Holdings' (HCA) Diverse Business Impress; Bad Debt Ail
Per the Zacks analyst, HCA Holdings' rising level of bad debt and weak Commercial business continues to drain the bottom line.
New Upgrades
Robust Label & Graphic Materials Segment Drives Avery (AVY)
The Zacks analyst expects Avery to gain from continued growth in its largest and highest-return business, Label and Graphic Materials driven by strong demand and share gain in emerging markets.
Crane (CR) to Grow on Strengthening Segmental Businesses
Per the Zacks Analyst, Crane Co. should gain from higher demand for productivity solutions, growth in aerospace programs, recovering fluid orders and engineered materials business.
New Downgrades
Core Labs (CLB) Stung by Lack of Deepwater Drilling Orders
With the commodity price rout making a number of deepwater drilling projects uneconomical, the Zacks analyst believes that Core Labs' future growth will be stymied by the paucity of such contracts.
Valmont (VMI) Hurt by Irrigation Weakness, High Input Costs
According to the Zacks analyst, weak agricultural market conditions continue to weigh on Valmont's irrigation unit. It also faces headwind from raw material price inflation, which may hurt margins.
United Technologies Corporation (NYSE:UTX): Free Stock Analysis Report
Red Hat, Inc. (RHT): Free Stock Analysis Report
The Kraft Heinz Company (KHC): Free Stock Analysis Report
Intel Corporation (NASDAQ:INTC): Free Stock Analysis Report
HCA Holdings, Inc. (HCA): Free Stock Analysis Report
EQT Corporation (NYSE:EQT): Free Stock Analysis Report
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Zacks Investment Research