Friday, February 19, 2021
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 Berkshire Hathaway (BRK.B), Walmart (WMT) and Home Depot (HD). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Berkshire Hathaway shares have outperformed the Zacks Insurance – Property and Casualty industry in the year to date period (+5.1% vs. +4.5%). The Zacks analyst believes that continued insurance business growth fuels increase in float, drives earnings and generates maximum return on equity.
The non-insurance businesses are delivering improved results with increased revenues over the past few years. A sturdy capital level provides further impetus. Furthermore, a strong cash position supports earnings-accretive bolt-on buyouts and indicates the company’s financial flexibility.
However, exposure to catastrophe loss induces earnings volatility and also affects the property and casualty underwriting results of Berkshire. Huge capital expenditure remains a headwind for the company.
Shares of Walmart have gained +5.4% in the last six months against the Zacks Supermarkets industry’s gain of +5.1%. The Zacks analyst believes the company has been benefiting from a high pandemic-led demand, especially in the e-commerce channel that remained strong in all units.
However, the stock took a hit following the company’s fourth-quarter fiscal 2021 results, wherein earnings missed the Zacks Consensus Estimate. During the quarter, high COVID-19 costs and repayment of property tax relief in the U.K. hurt the adjusted operating income.
Additionally, management’s fiscal 2022 view suggests a decline in net sales and earnings per share, mainly due to divestitures. Nonetheless, earnings and sales grew year over year in the quarter, with U.S. comp sales rising for the 26th straight time.
Home Depot’s shares have gained +4.9% over the past three months against the Zacks Retail Building Products industry’s rise of +8%. The Zacks analyst believes that interconnected retail strategy and underlying technology infrastructure have helped boost web traffic in the recent past.
The company also gained from strong growth in its Pro and DIY customer categories. During the third-quarter fiscal 2020, the company witnessed continued strong demand for home improvement projects as customers spent more time at home during the coronavirus pandemic.
It is effectively adapting to the high-demand environment, driven by investments in its business over the years. However, soft margins have partly weighed on the company’s results.
Other noteworthy reports we are featuring today include Novo Nordisk (NVO), CVS Health (CVS) and Booking (BKNG).
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
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 Earnings Trends and Earnings Preview reports. If you want an email notification each time Sheraz publishes a new article, please click here>>>