Monday, October 3, 2016
The major indexes started October's first trading session on a down note, after finishing September effectively unchanged. The flat September finish notwithstanding, Q3 was overall positive for stocks, with the S&P 500 index gaining in excess of 3%, largely on the back of strength in the tech sector which took leadership away from utilities and telecom stocks. The tech move is a net positive for the market as it likely is reflective of market participants' willingness to take on extra risk.
On the data front, the focus this week is on the September non-farm payroll report coming out on Friday, with consensus expectations of 168K vs. 151K in August. The recent run of low weekly jobless claims numbers is prompting some analysts to look for a much stronger number - something north 200K - that could add to pressures on the Fed. This morning's factor sector ISM survey surprised to the upside, with the index going back above the 50 line.
Today's Research Daily features new research reports on 16 major stocks, including Chevron (NYSE:CVX), Morgan Stanley (NYSE:MS) and General Electric (GE).
Chevron shares have responded more positively to the recent oil-price momentum than Exxon (NYSE:XOM) and some of its other super-major peers given the company's oilier asset base. Strong Buy rated Chevron's current oil and gas development project pipeline is among the best in the industry, boasting large, multi-year projects. The company has remained competitive by embarking on aggressive cost reduction initiatives, exiting unprofitable markets and streamlining the organization. (You can read the full research report on Chevron here>>)
Morgan Stanley struggled this year as a result of the tough environment for financial firms as a whole, but it has nevertheless fared better than Goldman Sachs (NYSE:GS) and others given its less reduced reliance on trading and greater focus on investment management in addition to its core investment banking franchise. The analyst likes the company’s efforts to offload its non-core assets to lower balance-sheet risks, control expenses and shift focus toward less capital-intensive businesses. Estimates ahead of the company's October 19th earnings release have ticked up modestly. (You can read the full research report on Morgan Stanley here>>)
General Electric shares have lagged the market this year on concerns about the conglomerate's order backlog and continued weakness in the energy end-market. This issue notwithstanding, the company has done an excellent job of its plan to reduce its exposure to finance and get back to its industrial and engineering roots. To that end, it is enjoying strong momentum in the power and aviation end markets, partly offset by continued weakness in the energy space. (You can read the full research report on General Electric here>>)
Other noteworthy reports we are featuring today include Microsoft (NASDAQ:MSFT), Tesla (NASDAQ:TSLA) and Amazon (NASDAQ:AMZN).
Free Access: All Zacks Research Reports
Starting today, you are invited to download in-depth analysis reports covering more than 1,000 of the most widely followed stocks. Valued at $25 each, they are yours to consult over the next 30 days absolutely free. They feature sensitive Zacks Rank information on each stock that you won't find anywhere else. See the reports free >>
You can find all of today's stock research reports here>>
Sheraz Mian
Director of Research
Note: If you want an email notification each time Sheraz publishes a new article, please click here>>>
Today's Must Read
Featured Reports
Tesla (TSLA) Improves Deliveries in Q3, Q4 to be Better
Tesla increased production and delivery volumes in Q3 and expects to marginally increase volumes in Q4. As a result, volumes are expected to be very close to the target of 50,000 units for 2H16.
Donaldson's (DCI) Earnings Growth Marred by Macro Woes
The Zacks analyst thinks Donaldson's earnings continue to be affected by weakness in key markets and currency fluctuations, despite robust restructuring actions and strong aftermarket growth.
Salesforce (CRM) Likely to Acquire Twitter
The covering analyst believes that buying Twitter will not be a wise move for Salesforce as it already has access to the former's database for lead generation.
Yahoo's (NASDAQ:YHOO) Deal with Verizon May Hurt by Data Breach
The Zacks analyst thinks the disclosure of the breach and its legal consequences could impact the deal if Verizon finds a material adverse change in Yahoo's business.
BB&T (NYSE:BBT) Resolves FHA-Legacy Issue
The covering analyst thinks BB&T's resolution of legacy FHA-mortgage related issue will go a long way in reducing legal hassles.
Amazon's (AMZN) Prime Faces Risk of Saturation in the US
The Zacks analyst believes that Prime saturation in the U.S. market and growing competition from online retail might prove to be detrimental to Amazon's profitability.
BlackBerry (BBRY) Incurs Narrower-Than-Expected Q2 Loss
The Zacks analyst is positive on the company's bottom-line performance in Q2.
New Upgrades
International Paper (IP) Poised for Healthy Inorganic Growth
The Zacks analyst thinks acquisition of Weyerhaeuser's pulp business will boost International Paper's global fluff pulp market position and augment operating cash flow.
Marsh & McLennan (MMC) Grows on Acquisitions & Investments
The covering analyst thinks the company will benefit from improved pricing, strong capital management and expense control initiatives. Acquisitions and restructuring will boost long term growth.
Walgreens (WBA) Strong on Strategic Initiative and Buyouts
The Zacks analyst remains upbeat about Walgreens' consistent focus on strategic innovations. Impending Rite Aid inclusion and other buyouts raise hope.
New Downgrades
Actuant's (ATU) Growth Prospects Weak on Multiple Headwinds
Actuant's fiscal fourth-quarter 2016 results were hurt due to weak oil price, low global demand and strong U.S. dollar. It expects core sales to fall within the 14-16% range in upcoming fiscal year.
Microsoft (MSFT) Creates Microsoft AI and Research Group
The Zacks analyst believes that the creation of the new group will help Microsoft to boost its presence in the rapidly growing Artificial Intelligence (AI) market.
Corning (GLW) Displays Gorilla Glass at the Paris Motor Show
According to the covering analyst, Gorilla Glass display at Paris Motor Show reflects Corning's continuing focus on expanding its footprint in the auto glazing market.
TESLA MOTORS (TSLA): Free Stock Analysis Report
MICROSOFT CORP (MSFT): Free Stock Analysis Report
MORGAN STANLEY (MS): Free Stock Analysis Report
GENL ELECTRIC (GE): Free Stock Analysis Report
CHEVRON CORP (CVX): Free Stock Analysis Report
AMAZON.COM INC (AMZN): Free Stock Analysis Report
Original post
Zacks Investment Research