Top Stock Reports For Alphabet, GlaxoSmithKline & T-Mobile
Zacks Investment Research | Jul 21, 2017 05:01AM ET
Friday, July 21, 2017
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 Alphabet (NASDAQ:GOOGL) (GOOGL), GlaxoSmithKline (GSK) and T-Mobile (TMUS). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today. You can see
Buy-rated Alphabet shares have outperformed the Zacks Internet-Services over the last one year period (the stock is up +30.6% vs. +22.1% gain for the sector) on the back of innovation and strategic acquisitions, while Android OS should continue to generate strong cash flows. Its diversification strategy is also positive, but requires significant investment and involves uncertain payback periods, particularly since these efforts are at the cutting edge of technology.
Alphabet has shown good execution to date, more or less maintaining its dominant share in a competitive, fast-growing search market. (You can ).
Shares of GlaxoSmithKline have gained more +11% year-to-date, marginally underperforming the Zacks Large-Cap Pharmaceuticals industry, which has gained +13.2% over the same period. However, Glaxo should continue to see strong performances from all of its business segments – Pharmaceuticals, Vaccines and Consumer Healthcare.
The Zacks analyst likes Glaxo’s efforts to develop its pipeline as well. Performance of new products as well as of those acquired from Novartis has been encouraging. However, persistent challenges like stiff competition, genericization and pricing pressure along with slowing growth in emerging markets have been affecting the company’s performance. In particular, pricing dynamics and competitive pressure are hurting sales of its top-selling drug Advair.
Meanwhile, Advair is expected to face generic competition in the U.S. soon which will further hurt sales. However, estimates have risen ahead of Glaxo’s Q2 earnings release. The company has also recorded a string of positive earnings surprises in recent quarters. (You can ).
T-Mobile’s shares have been strong performers lately - the stock is up +34.5% over the last 12 months, handily outperforming the Zacks National Wireless industry (down -12%) and the broader Zacks Telecommunications Services industry (down -6.8%). T-Mobile US posted impressive second-quarter 2017 financial results.
The Zacks analyst thinks T-Mobile US' network expansion plans of 5G trials with Ericsson (BS:ERICAs) and Nokia (HE:NOKIA), 4G LTE network improvement and expansion, deployment of LTE-U technology and unlimited ‘T-Mobile One’ plan have driven additional net customers of 1.333 million. The company raised its outlook for 2017 on the back of huge subscriber gains.
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However, competitive and saturated wireless market and marketing costs of the low-priced promotional plans are major headwinds. Also, it faces increased scrutiny in its working conditions, lawsuits and fines by regulatory authorities. (You can ).
Other noteworthy reports we are featuring today include EOG Resources (NYSE:EOG) (EOG), Northrop Grumman (NOC) 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, global demand for Northrop's products earns it notable FMS orders, which in turn expand its footprint in overseas. Also, Trump's defense budget proposal buoys optimism.
The Zacks analyst likes the company's efforts to check costs. Efforts to reward shareholders also raise optimism.
The Zacks analyst expects Grainger to gain from pricing actions and marketing activities leading to simplification of pricing structure.
Per the Zacks analyst, Crown Holdings will gain from expanding facilities to tap rising global beverage can demand.
Per the Zacks analyst, Progressive enjoys improved premiums driven by its diversified portfolio. It is also penetrating customer households via cross-selling auto policies and Home Advantage.
Per the Zacks analyst, focus on initiating new business against the backdrop of macroeconomic headwinds should bolster Northern Trust's revenues.
The Zacks analyst believes that Expedia's acquisitions of Wotif, Travelocity, Orbitz, HomeAway and SilverRail lead to increased penetration in existing markets.
Per the Zacks analyst, global demand for Northrop's products earns it notable FMS orders, which in turn expand its footprint in overseas. Also, Trump's defense budget proposal buoys optimism.
The Zacks analyst likes the company's efforts to check costs. Efforts to reward shareholders also raise optimism.
The Zacks analyst expects Grainger to gain from pricing actions and marketing activities leading to simplification of pricing structure.
Per the Zacks analyst, Crown Holdings will gain from expanding facilities to tap rising global beverage can demand.
Per the Zacks analyst, Progressive enjoys improved premiums driven by its diversified portfolio. It is also penetrating customer households via cross-selling auto policies and Home Advantage.
Per the Zacks analyst, focus on initiating new business against the backdrop of macroeconomic headwinds should bolster Northern Trust's revenues.
The Zacks analyst believes that Expedia's acquisitions of Wotif, Travelocity, Orbitz, HomeAway and SilverRail lead to increased penetration in existing markets.
New Upgrades/h6
Per the Zacks analyst, BancorpSouth's consistently rising fee income has been driven by increasing mortgage banking fees supporting top-line. Strong capital base is another favorable factor.
The Zacks analyst is encouraged by the strong growth displayed by the company's Network Solutions portfolio. Its efforts to reward shareholders also raise optimism.
Per the Zacks analyst, rising loan demand, lesser regulations and higher rates will aid Washington Federal's revenues. Also, the acquisition of Anchor Bancorp will be accretive to its earnings.
Per the Zacks analyst, BancorpSouth's consistently rising fee income has been driven by increasing mortgage banking fees supporting top-line. Strong capital base is another favorable factor.
The Zacks analyst is encouraged by the strong growth displayed by the company's Network Solutions portfolio. Its efforts to reward shareholders also raise optimism.
Per the Zacks analyst, rising loan demand, lesser regulations and higher rates will aid Washington Federal's revenues. Also, the acquisition of Anchor Bancorp will be accretive to its earnings.
New Downgrades/h6
EOG Resources is highly exposed to the struggling North American energy market which has affected its financials, according to the Zacks analyst.
Per the Zacks analyst, concerns about economic growth and the feasibility of the Trump administration's infrastructure stimulus promises and related uncertainty are weighing heavily on AECOM.
Soft consumer spending in the U.S. restaurant space is likely to hurt comps. Also, higher labor as well as costs related to various initiatives will continue to dent margins, per the Zacks analyst.
EOG Resources is highly exposed to the struggling North American energy market which has affected its financials, according to the Zacks analyst.
Per the Zacks analyst, concerns about economic growth and the feasibility of the Trump administration's infrastructure stimulus promises and related uncertainty are weighing heavily on AECOM.
Soft consumer spending in the U.S. restaurant space is likely to hurt comps. Also, higher labor as well as costs related to various initiatives will continue to dent margins, per the Zacks analyst.
Zacks Investment Research
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