Top Analyst Reports For Facebook, FIS & American Express
Zacks Investment Research | Mar 25, 2020 01:06AM ET
Wednesday, March 25, 2020
The Zacks Research Daily presents the best research output of our analyst team. Today's Research Daily features new research reports on 16 major stocks, including Facebook (NASDAQ:FB) (FB), Fidelity National Information Services (FIS) and American Express (AXP). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
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Facebook’s shares have outperformed the S&P 500 over the past six months (-10.6% vs. -17.3). The Zacks analyst believes that Facebook is benefiting from growth in Instagram Stories and Feed, and expanding user base in Asia Pacific.
The launch of Facebook View app, Facebook Pay, a simpler and faster Messenger for iOS app and more location control feature for Android users is a positive. However, Facebook expects ad-sales to be hurt by the coronavirus lockdowns despite a significant spike in traffic.
Moreover, increasing limitations in tracking user activity amid the growing privacy-related regulations and changes made in the mobile operating systems and browser platforms by Apple (NASDAQ:AAPL) and Google (NASDAQ:GOOGL) as well as tools like the Off Facebook Activity controls are expected to affect top-line growth. Moreover, a persistent mix shift toward Stories is anticipated to weigh on ARPU.
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Shares of Fidelity National Information Services have gained 7.6% over the past year against the Zacks Financial Transaction Services industry’s fall of 4.5%. The Zacks analyst believes that the company remains well poised for growth backed by attractive core business with several ongoing initiatives.
Acquisition of Worldpay is likely to accelerate growth by expanding its presence in fast growing markets. The company recently raised run-rate synergy targets to $1.23 billion from revenue and cost savings by 2022. Further, increasing investment in mobile banking and innovative products is likely to support the company's growth.
However, the company remains exposed to persistently rising costs and consolidation in the banking sector. Also, unsustainable capital deployment activities remain a concern.
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American Express’ shares have lost 31.2% over the past three months against the Zacks Financial Miscellaneous Services industry’s fall of 35.8%. The Zacks analyst believes that due to COVID-19 outbreak, the company is witnessing weakness in spending volumes, which is likely to hurt its first quarter operating performance.
Its revenue growth is driven by a strong brand, continued efforts toward building business in new growth verticals, shift toward digital and a strong economy, which are driving consumer spending. Its strong balance sheet position and disciplined capital management are impressive.
However, the company's reward expenses have been increasing over the past many quarters, which weigh on margins. Cost of card member services has been increasing over the years, indicating higher engagement level across its premium travel services.
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Other noteworthy reports we are featuring today include NVIDIA (NVDA), Advanced Micro Devices (NASDAQ:AMD) (AMD) and CSX Corp. (CSX).
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Mark Vickery
Senior Editor
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
Today's Must Read/h6
Featured Reports/h6
Per the Zacks Analyst, NVIDIA is benefiting from rapid adoption of its GPUs in the gaming and data-center markets.
Per the Zacks analyst, Advanced Micro Devices is benefiting from robust adoption of latest EYPC, Ryzen and Radeon processors.
The Zacks analyst is impressed by CSX's cost-reduction efforts and its measures to add shareholder value.
The Zacks analyst is bullish about the combined strength of WATCHMAN, LOTUS Edge positioning Boston Scientific well. The recently-closed BTG acquisition is another plus.
While Barrick faces challenges from higher production costs, it should gain from its actions to cut debt and synergies of the Randgold buyout, per the Zacks analyst.
Per the Zacks analyst, Simon Property's varied premium retail assets across the globe and solid balance sheet position will likely support growth. Yet, the coronavirus pandemic is a major concern.
The Zacks analyst is bullish about the Omnipod business which has lined up a clinical trial and subsequent launch of Omnipod Horizon. Further, continued market expansion of Omnipod buoys optimism.
Per the Zacks Analyst, NVIDIA is benefiting from rapid adoption of its GPUs in the gaming and data-center markets.
Per the Zacks analyst, Advanced Micro Devices is benefiting from robust adoption of latest EYPC, Ryzen and Radeon processors.
The Zacks analyst is impressed by CSX's cost-reduction efforts and its measures to add shareholder value.
The Zacks analyst is bullish about the combined strength of WATCHMAN, LOTUS Edge positioning Boston Scientific well. The recently-closed BTG acquisition is another plus.
While Barrick faces challenges from higher production costs, it should gain from its actions to cut debt and synergies of the Randgold buyout, per the Zacks analyst.
Per the Zacks analyst, Simon Property's varied premium retail assets across the globe and solid balance sheet position will likely support growth. Yet, the coronavirus pandemic is a major concern.
The Zacks analyst is bullish about the Omnipod business which has lined up a clinical trial and subsequent launch of Omnipod Horizon. Further, continued market expansion of Omnipod buoys optimism.
New Upgrades/h6
Per the Zacks analyst, Clorox has been benefiting from its cost-saving efforts, especially the IGNITE strategy. On the back of IGNITE, Clorox envisions EBIT margin expansion of 175 bps annually.
Per the Zacks analyst, Western Digital is expected to gain from growing clout of higher capacity drives. Further, expansion of Ultrastar HDD family with capacities of 20 TB and 18 TB HDDs bodes well.
Per the Zacks analyst, Olin's investments in the IT project will boost operational efficiency and provide cost savings. The Lake City contract will also drive profitability in its Winchester unit.
Per the Zacks analyst, Clorox has been benefiting from its cost-saving efforts, especially the IGNITE strategy. On the back of IGNITE, Clorox envisions EBIT margin expansion of 175 bps annually.
Per the Zacks analyst, Western Digital is expected to gain from growing clout of higher capacity drives. Further, expansion of Ultrastar HDD family with capacities of 20 TB and 18 TB HDDs bodes well.
Per the Zacks analyst, Olin's investments in the IT project will boost operational efficiency and provide cost savings. The Lake City contract will also drive profitability in its Winchester unit.
New Downgrades/h6
The Zacks analyst agrees that weak oilfield service activities in both North America and international markets will continue to hurt Schlumberger.
Per the Zacks analyst Noble Energy (NASDAQ:NBL)'s near-term performance will be adverse impacted by the falling oil prices, which have forced the company to lower capital spending to preserve liquidity.
Increasing production costs eating through Cimarex's income concerns the Zacks analyst. Moreover, slowdown of Mid-Continent operations will hurt the company's business.
The Zacks analyst agrees that weak oilfield service activities in both North America and international markets will continue to hurt Schlumberger.
Per the Zacks analyst Noble Energy (NASDAQ:NBL)'s near-term performance will be adverse impacted by the falling oil prices, which have forced the company to lower capital spending to preserve liquidity.
Increasing production costs eating through Cimarex's income concerns the Zacks analyst. Moreover, slowdown of Mid-Continent operations will hurt the company's business.
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