Friday, May 13, 2022
Zacks Research Daily features top research results from our team of analysts. Today’s Research Daily features new research reports on 16 major stocks, including Walmart Inc. (WMT), Chevron Corporation (CVX) and Mastercard Incorporated (MA). These research reports have been handpicked from the approximately 70 reports published today by our team of analysts.
You can see all research reports from today here >>>
walmart stocks have held up very well against the continued market decline, with the stock now up +1.9% year-to-date against the -20.6% drop in the S&P 500. The Zacks analyst believes the company continues to leverage its robust omnichannel efforts and last-mile delivery capabilities. With more customers and members returning to stores and clubs, demand appears to be strong. The Zacks analyst expects these positives to be on full display in the company’s quarterly earnings report on Tuesday, May 17.
Walmart incurred high supply chain, payroll, and COVID-19-related costs in the fourth quarter of fiscal 2022, and expects some of them to linger for part of that year. year, including the next quarterly publication. The company expects operating profit and earnings per share to decline in the first quarter as it cycles the stimulus gains seen last year, as well as higher wages this year.
(You can read the full Walmart research report here >>>)
Shares of Chevron outperformed the industry Zacks Oil and Gas – Integrated – International over the past year (+59.8% vs. +41.7%). The Zacks analyst believes that based on a host of tailwinds, he looks set for further capital appreciation. The supermajor is considered one of the integrated oil companies best positioned to achieve sustainable production growth. The second-largest US energy company’s project pipeline is among the best in the industry, thanks to its prominent position in the lucrative Permian Basin.
The company’s takeover of Noble Energy has expanded its footprint in the region and the DJ Basin, as well as adding cash-generating offshore assets in Israel. In shareholder-friendly moves, the integrated major recently increased its dividend and strengthened its share buyback program. Therefore, Chevron is considered a favorite big energy company to own now.
(You can read the full Chevron research report here >>>)
MasterCard shares are down -8.0% over the past year against the -37.1% decline in Zacks’ financial transaction services sector. The Zacks analyst thinks that due to high operating expense margins, this could be stressful. High discounts and incentives can weigh on bottom line. Nevertheless, the company’s profit levels increase thanks to the increase in consumer spending. Numerous acquisitions help it develop addressable markets and generate new revenue streams.
The COVID-19 crisis has accelerated the use of electronic payments with much greater adoption of digital and contactless solutions. The situation presents an opportunity for Mastercard’s business to accelerate its transition to digital mode. The company is well positioned to take advantage of stable cash generation capabilities. A strong capital position allows the company to pursue acquisitions and deploy capital. As such, the title warrants a cautious stance.
(You can read the full Mastercard research report here >>>)
Other noteworthy reports we are featuring today include Honeywell International Inc. (HON), SAP SE (SAP) and Caterpillar Inc. (CAT).
Director of Research
Note: Sheraz Mian leads the equity research department at Zacks and is a well-known expert on overall earnings. He is frequently quoted in the written and electronic press and publishes the weekly Earnings Trends and Revenue overview reports. If you would like to receive an email notification whenever Sheraz publishes a new article, please click here>>>
To read today
Walmart (WMT) wins on e-commerce efforts hurt by cost concerns
Chevron (CVX) will take advantage of the massive Permian area
Accretive Redemptions, Helps Strong Cash Position Mastercard (MA)
Strong demand helps Honeywell (HON), Warehouse Automation Ails
According to the Zacks analyst, strong demand for Honeywell’s advanced sensing technologies and productivity solutions will boost the company. Weakness in the warehouse automation unit is concerning.
Strong Momentum in Cloud Business Drives SAP Performance
According to the Zacks analyst, SAP’s performance is benefiting from the strengthening of its cloud activity, mainly Rise with SAP solution. However, the low adoption of software licenses and support offerings is concerning.
Strong demand to support Caterpillar (CAT) in a high cost environment
According to the Zacks analyst, strong demand in its end markets will boost Caterpillar’s performance and help offset the impact of inflated input costs and supply chain issues on its margins.
Operational prowess facilitates waste management (WM) in a high debt environment
The Zacks analyst is impressed with Waste Management’s strong operating performance, which has helped it strengthen its cash position. A heavily indebted balance sheet remains a concern.
Strategic takeovers Aid Capital One (COF), Asset Quality Ails
According to the Zacks analyst, strength in the credit card business, higher rates and strategic acquisitions will support Capital One. However, deteriorating asset quality and rising costs are major concerns.
Cenovus (CVE) will benefit from the sale of Tucker’s Alberta assets
The Zacks analyst is optimistic that Cenovus’ divestiture of the Tucker thermal asset in Alberta will help reduce debt burdens and increase shareholder returns.
Strong support for PG&E Corp (PCG) investments amid rising costs
According to the Zacks analyst, constant investments strengthen PG&E Corp’s infrastructure and customer reliability. Still, the stock is incurring additional operating costs due to the pandemic.
Sysco (SYY) results benefit from Recipe for Growth program
According to the Zacks analyst, Sysco’s recipe for growth has helped. This includes improving the customer experience through digital tools; improving the supply chain and team selling, among others.
Paylocity Holding (PCTY) benefits from growing customer base
According to the Zacks analyst, Paylocity Holding benefits from its differentiated employee strategy, comprehensive product offerings and on-demand payment service, which help it win new customers.
Adtalem (ATGE) pursues its goal of being the leading healthcare provider
According to the Zacks analyst, Adtalem’s post-licensing nursing programs, buyout synergies and strategic divestments are helping it become a pure player, leading provider of talent for the healthcare industry.
Rising input costs and China slowdown hurt DuPont (DD)
According to the Zacks analyst, rising raw material costs due to supply chain issues will weigh on DuPont’s margins. Sales of its Interconnect Solutions unit will also be affected by the slowdown in China.
PayPal (PYPL) suffers from weak international market
PayPal’s declining international revenue due to weakening international market momentum is hurting its revenue growth, according to the Zacks analyst.
Declining LPD sales and growing spending hurt IDEXX (IDXX)
The Zacks analyst is discouraged by declining sales performance in IDEXX’s Livestock, Poultry and Dairy business. Escalating operating expenses also continue to put pressure on the bottom line.
Zacks names ‘only one best choice for doubling up’
From thousands of stocks, 5 Zacks experts have each picked their favorite to skyrocket by +100% or more in the coming months. Of these 5, Research Director Sheraz Mian selects one to have the most explosive advantage of all.
It’s a little-known chemical company that’s up 65% year-on-year, but still very cheap. With relentless demand, rising earnings estimates for 2022 and $1.5 billion for stock buybacks, retail investors could jump in at any moment.
This company could rival or surpass other recent Zacks stocks which are expected to double, such as Boston Beer Company which jumped +143.0% in just over 9 months and NVIDIA which jumped +175.9% in one. year.
Free: See our best stock and our 4 finalists >>
Click to get this free report
Chevron Corporation (CVX): Free Stock Analysis Report
Mastercard Incorporated (MA): Free Inventory Analysis Report
Caterpillar Inc. (CAT): Free Inventory Analysis Report
Honeywell International Inc. (HON): Free Stock Analysis Report
Walmart Inc. (WMT): Free Inventory Analysis Report
SAP SE (SAP): Free Inventory Analysis Report
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Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.