Top Analyst Reports For JPMorgan, Mastercard & Qualcomm
Zacks Investment Research | Mar 16, 2020 12:45AM ET
Monday, March 16, 2020
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 JPMorgan Chase (JPM), Mastercard (MA) and Qualcomm (QCOM). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
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JPMorgan’s shares have outperformed the Zacks Major Regional Banks industry over the past six months (-12.4% vs. -23.3%). The Zacks analyst believes that decent loan demand, the acquisition of InstaMed, new branch openings and focus on credit card business will continue to aid the company's financials.
The bank has surpassed the Zacks Consensus Estimate for earnings in each of the trailing four quarters. Its enhanced capital deployment plan reflects strong balance sheet position. Notably, the company has stopped its share buybacks with an aim to use the capital for lending activities amid coronavirus related slowdown.
However, the Federal Reserve's accommodative monetary policy stance is expected to hurt top-line growth in the near term. Challenges in expanding mortgage operations and the company’s significant dependence on capital markets revenues make us apprehensive and might hamper financials to some extent.
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Shares of Mastercard have gained +17.2% over the past year against the Zacks Financial Transaction Services industry’s rise of +10.9%. The Zacks analyst believes that the company is benefiting from shifts in payments, from physical to digital.
Investment in technology has also kept the company at the forefront of the rapidly changing payments industry. Its solid capital position enables investment in business. The company has been gaining from higher switched transactions, increase in cross-border volume and gross dollar volume, and gains from acquisitions. Increase in rebates and incentives year over year was a partial dampener.
However, escalating costs might put pressure on margins. In order to gain customers and new business Mastercard has been incurring high levels of costs under rebates and incentives, which remain a concern.
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Qualcomm’s shares have lost -14.2% over the past three months against the Zacks Wireless Equipment industry’s fall of -19.7%. The Zacks analyst believes that the company is poised to benefit significantly from the settlement with Apple (NASDAQ:AAPL).
Qualcomm is focused on retaining its position in the chipset market and mobile connectivity with several technological achievements and innovative product launches. It offers the flexibility and scalability needed for broad and fast 5G adoption through commercialization by OEMs. While the company expanded its leadership to the high tiers with Snapdragon 700, Snapdragon 800 solutions should continue defining the premium tier benchmarks.
However, Qualcomm is likely to face softness in demand from China with Huawei gaining prominence in the local market and OEMs managing their inventory ahead of 5G. In addition, margins have decreased sharply due to high operating expenses and R&D costs. Aggressive competition in the mobile phone chipset market is also likely to hurt profits.
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Other noteworthy reports we are featuring today include Cigna (CI), Petrobras (PBR) and Walgreens Boots Alliance (NASDAQ:WBA) (WBA).
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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, the buyout of Express Scripts has diversified Cigna's operations opening up new revenue streams; increasing membership superior products and services have led to revenue growth.
Petrobras' stakes in Brazil's attractive pre-salt oil reservoirs should boost its earnings outlook. However, the Zacks analyst is concerned over the company's huge debt load of $78.9 billion.
Per the Zacks analyst, efforts to improve prescription growth in Retail Pharmacy USA will aid Walgreens.
The Zacks analyst is impressed by Uber's top line growth, courtesy of robust rise in revenues from rides.
Solid prospects in the core U.S. Pharmaceutical unit aids McKesson. The Zacks Analyst is however apprehensive about the stiff competition in the MedTech space.
Per the Zacks analyst, business wins and strategic acquisitions over the past few years will continue to aid State Street's top line.
Per the Zacks analyst, continued growth in advertising revenues driven by strong demand for live programming and higher affiliate fees is benefiting Fox's overall growth.
Per the Zacks analyst, the buyout of Express Scripts has diversified Cigna's operations opening up new revenue streams; increasing membership superior products and services have led to revenue growth.
Petrobras' stakes in Brazil's attractive pre-salt oil reservoirs should boost its earnings outlook. However, the Zacks analyst is concerned over the company's huge debt load of $78.9 billion.
Per the Zacks analyst, efforts to improve prescription growth in Retail Pharmacy USA will aid Walgreens.
The Zacks analyst is impressed by Uber's top line growth, courtesy of robust rise in revenues from rides.
Solid prospects in the core U.S. Pharmaceutical unit aids McKesson. The Zacks Analyst is however apprehensive about the stiff competition in the MedTech space.
Per the Zacks analyst, business wins and strategic acquisitions over the past few years will continue to aid State Street's top line.
Per the Zacks analyst, continued growth in advertising revenues driven by strong demand for live programming and higher affiliate fees is benefiting Fox's overall growth.
New Upgrades/h6
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, rise in demand for cybersecurity products due to continuously increasing global hacking events is driving NortonLifeLock's top-line growth.
Per the Zacks analysts, Acuity Brands' diversified portfolio of innovative lighting control solutions and energy-efficient luminaries, backed by acquisitions and joint ventures bode well.
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, rise in demand for cybersecurity products due to continuously increasing global hacking events is driving NortonLifeLock's top-line growth.
Per the Zacks analysts, Acuity Brands' diversified portfolio of innovative lighting control solutions and energy-efficient luminaries, backed by acquisitions and joint ventures bode well.
New Downgrades/h6
General Motors' considerable China exposure is likely to dent sales amid economic slowdown & coronavirus crisis. Further, high R&D costs might take a toll on margins, per the Zacks analyst.
Per the Zacks analysts, high labor costs, intense competition, and the company's limited international presence raise concerns.
Higher start-up costs, advertising and technology-related expenses and lower enrollment have been impacting American Public's business, per the Zacks analyst.
General Motors' considerable China exposure is likely to dent sales amid economic slowdown & coronavirus crisis. Further, high R&D costs might take a toll on margins, per the Zacks analyst.
Per the Zacks analysts, high labor costs, intense competition, and the company's limited international presence raise concerns.
Higher start-up costs, advertising and technology-related expenses and lower enrollment have been impacting American Public's business, per the Zacks analyst.
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