Top Stock Reports For PepsiCo, Walgreens Boots & EOG Resources
Zacks Investment Research | Jan 09, 2018 03:52AM ET
Wednesday, January 9, 2018
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 PepsiCo (PEP), Walgreens Boots (WBA) and EOG Resources (NYSE:EOG). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
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PepsiCo’s shares have gained +15.7% year to date, underperforming the Zacks Soft Beverages industry, which has increased +17.4% over the same period. However, PepsiCo has been doing well on the back of significant innovation, continued momentum in Frito-Lay business, revenue management strategies, improved productivity and cost-saving initiatives, along with better market execution.
Moreover, an improving economy, better industry pricing dynamics and a consistency in positive innovation bode well. It rolled out several products recently which management believes will drive sales and profits in 2018.
That said, growing health awareness has been hurting the CSD category, resulting in a 4% volume decline in the first nine months of 2017 in North America. Again, rising volatility in global markets and increasing currency headwinds may dampen growth.
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Shares of Buy-rated Walgreens Boots have done better than the embattled Zacks Drug Stores industry over the last year (WBA is down -10.7% vs. decline of -12.3% for the peer group). Walgreens Boots reported an impressive first quarter of fiscal 2018. The increase in sales at the Retail Pharmacy International is a major positive.
Moreover, Walgreens Boots has been gaining on account of strategic tie-ups, which brought more patients to its U.S. pharmacies. The Zacks analyst likes the Rite Aid stores acquisition deal for which the company got regulatory approval recently. Also, the company is expanding its global footprint with its decision to acquire a 40% stake in Sinopharm Holding Guoda Drugstores in China which should provide a strong impetus to Walgreens Boots’ worldwide retail pharmacy business.
On the flip side, declining sales at the Retail Pharmacy was a disappointment. The company faces tough competition along with currency fluctuations. Also, slowdown in generic introduction continues to weigh on margins.
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Buy-rated EOG Resources’ shares have gained around +9% over the last one year, outperforming the Zacks Oil & Gas E&P Industry, which has declines -11.1% over the same period. EOG Resources holds premium acreages in the Permian, Bakken and Eagle Ford oil shale plays in the United States.
The Zacks analyst likes the firm’s plan to complete 505 wells in the resources in 2017, significantly higher than 443 recorded in 2016. Notably, during 2016, almost 50% of the wells drilled by the firm met the standard of premium wells. The company expected 80% and 90% of the wells to meet the standards in 2017 and 2018, respectively.
In the promising U.S. shale plays, EOG Resources has identified 8,000 premium wells that can give access to almost 7.3 billion barrels of oil equivalent estimated potential reserves over a period of 10 years. The upstream energy player’s pricing chart history is also impressive.
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Other noteworthy reports we are featuring today include Ford (F), Praxair (NYSE:PX) and Analog Devices (ADI).
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Featured Reports/h6
The Zacks analyst likes Delta's performance with respect to passenger unit revenues (PRASM). Efforts to modernize its fleet also raise optimism. High labor and fuel costs are hurting the bottom line.
Per the Zacks analyst, although Tenet Healthcare's inorganic growth impresses, continuously rising level of debt hurts the bottom line.
The Zacks analyst believes WEC Energy will gain from its planned capital expenditure of $11.8B over 2018-2022 and a swelling customer base thanks to improving economic conditions.
Per the Zacks analyst, strong product mix and pricing are aiding Ford's sales performance in Europe.
Per the Zacks analyst, Praxair will gain from rising applications of industrial gases like hydrogen in refining, oxygen in healthcare, and nitrogen and carbon dioxide in oil & gas industries.
Per the Zacks analyst, Huntington's strong liquidity position keeps it well poised to grow through acquisitions.
The Zacks analyst believes that Analog Devices' strength in the emerging automotive market and contributions from Linear acquisition remain growth catalysts going forward.
The Zacks analyst likes Delta's performance with respect to passenger unit revenues (PRASM). Efforts to modernize its fleet also raise optimism. High labor and fuel costs are hurting the bottom line.
Per the Zacks analyst, although Tenet Healthcare's inorganic growth impresses, continuously rising level of debt hurts the bottom line.
The Zacks analyst believes WEC Energy will gain from its planned capital expenditure of $11.8B over 2018-2022 and a swelling customer base thanks to improving economic conditions.
Per the Zacks analyst, strong product mix and pricing are aiding Ford's sales performance in Europe.
Per the Zacks analyst, Praxair will gain from rising applications of industrial gases like hydrogen in refining, oxygen in healthcare, and nitrogen and carbon dioxide in oil & gas industries.
Per the Zacks analyst, Huntington's strong liquidity position keeps it well poised to grow through acquisitions.
The Zacks analyst believes that Analog Devices' strength in the emerging automotive market and contributions from Linear acquisition remain growth catalysts going forward.
New Upgrades/h6
Per the Zacks analyst, Cboe Global Markets is set to grow on improving revenues. Sustained growth in transaction fees driven by higher trading volume will continue to drive the top line.
The covering analyst stresses that D.R. Horton will benefit from expanding operations in Texas with its recent agreement to buy 75% shares of Forestar Group.
Per the Zacks analyst, focus on enhancing consumers' experience; optimising business and achieving operational efficacy will help Sysco achieve 2020 target of growing earnings at double-digit rate.
Per the Zacks analyst, Cboe Global Markets is set to grow on improving revenues. Sustained growth in transaction fees driven by higher trading volume will continue to drive the top line.
The covering analyst stresses that D.R. Horton will benefit from expanding operations in Texas with its recent agreement to buy 75% shares of Forestar Group.
Per the Zacks analyst, focus on enhancing consumers' experience; optimising business and achieving operational efficacy will help Sysco achieve 2020 target of growing earnings at double-digit rate.
New Downgrades/h6
Per the Zacks analyst, intensifying competition in the USB flash drive controller market remains a major headwind. Going forward, dip in smartphone sales will prove to be a drag on the revenues.
Per the Zacks analyst, Rite Aid's dismal comparable store sales performance driven by lower pharmacy and front-end sales is likely to keep top line growth at bay.
Per the Zacks analyst, DISH Network (NASDAQ:DISH) continues to lose subscribers due to stiff competition and cord-cutting. Weak liquidity position and retransmission fees-related issues are other risks.
Per the Zacks analyst, intensifying competition in the USB flash drive controller market remains a major headwind. Going forward, dip in smartphone sales will prove to be a drag on the revenues.
Per the Zacks analyst, Rite Aid's dismal comparable store sales performance driven by lower pharmacy and front-end sales is likely to keep top line growth at bay.
Per the Zacks analyst, DISH Network (NASDAQ:DISH) continues to lose subscribers due to stiff competition and cord-cutting. Weak liquidity position and retransmission fees-related issues are other risks.
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