Tuesday, December 15, 2020
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 Coca-Cola (KO), Oracle (ORCL) and Chevron (CVX). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
You can see all of today’s research reports here >>>
Coca-Cola shares have underperformed the Zacks Soft Drinks Beverages industry in the year to date period (-2.8% vs. +0.3%). The Zacks analyst believes that Coca-Cola has been witnessing a surge in e-commerce with the growth rate of the channel doubling in many countries due to a shift in consumer behavior due to the coronavirus pandemic.
The company’s third-quarter revenues and volume reflected improved trends from the second quarter. It is poised to gain from the streamlining of portfolio and accelerating investments to expand digital presence due to shift in consumer preference.
However, continued pressures in the away-from-home channel, which account for nearly half of its revenues, hurt revenue growth. It also lost global value share in NARTD beverages on negative channel mix.
(You can read the full research report on Coca-Cola here >>>)
Shares of Oracle have gained +13.5% over the past year against the Zacks Computer Software industry’s gain of +31.3%. The Zacks analyst believes that Oracle is benefiting from upbeat cloud business on solid adoption of data cloud solutions, ERP and Autonomous Database offerings.
Strong uptake of cloud-based solutions, comprising NetSuite ERP, Fusion ERP and Fusion HCM, aided revenue growth. Also, companies like MercadoLibre, Xactly, 8×8 and Zoom Video have selected Oracle Cloud Infrastructure services to address business needs, which is a testament to the strength of its cloud offerings.
Solid demand for the Oracle Dedicated Region Cloud@Customer supported by ML is anticipated to drive the top line. However, rise in spend on product enhancements amid stiff competition in the cloud market is likely to limit margin expansion.
(You can read the full research report on Oracle here >>>)
Chevron’s shares have lost -5.3% over the past six months against the Zacks Integrated Oil industry’s fall of -2.4%. The Zacks analyst believes that Chevron is not immune to commodity price crash, forcing it to cut capital spending and suspend buybacks. The company’s high oil price sensitivity is a concern too.
Moreover, the supermajor’s reserve replacement ratio of 44% is indicative of its inability to add proved reserves to replace the amount of oil and gas produced. However, the company not only eked out a Q3 profit, it vowed to keep its dividend and reported impressive U.S. production growth thanks to strength in the Permian Basin.
Chevron’s Noble Energy takeover has expanded its footprint in the DJ Basin and the Permian Basin along with the addition of cash-generating offshore assets in Israel.
(You can read the full research report on Chevron here >>>)
Other noteworthy reports we are featuring today include Adobe (ADBE), Boeing (BA) and 3M Company (MMM).
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Sheraz Mian
Director of Research
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>>>
Today’s Must Read
Coca-Cola (KO) Boosts Digital Investments Amid Pandemic
Oracle (ORCL) Gains from Cloud Suite Adoption & Partnerships
Chevron (CVX) Boosts Permian Position with Noble Buy
Featured Reports
Adobe (ADBE) Rides on Creative Strength; Expenses A Concern
The Zacks analyst believes that Adobe’s creative cloud business contributes significant revenues and generates high margins.
Strategic Mergers Aid Boeing (BA), Low 737 Deliveries Hurt
Per the Zacks analyst, strategic mergers made by Boeing, such as overtaking KLX, boosts growth. However, low 737 deliveries raises concerns.
Cost Control to Buoy Caterpillar (CAT) Amid Weak Demand
Per the Zacks analyst, Caterpillar’s focus on cutting down costs will help sustain margins despite the weak demand owing to the impact of the coronavirus pandemic.
Free Cash Flow Aids Norfolk Southern (NSC), Volumes Ail
The Zacks analyst is pleased with the company’s strong free cash flow generating ability. Cost-cutting efforts are encouraging too.
Ross Stores (ROST) Q3 Sales Mirror Improved Sequential Trends
Per the Zacks analyst, Ross Stores’ Q3 sales reflect strong sequential growth on better merchandise assortments and return to normal store hours.
Acquisitions, Divestitures, Cost Control Efforts To Aid AIG
Per the Zacks analyst, business streamlining by selling low returning business, and focusing on high growth businesses are driving growth.
Solid Product Demand Benefits 3M (MMM) Amid Pandemic Woes
Per Zacks analyst, 3M (MMM) is poised to benefit from solid demand for products, especially respirators. However, the pandemic-led challenges remain concerning.
New Upgrades
ExxonMobil (XOM) Banks on Offshore Guyana Oil Discoveries
The Zacks analyst appreciates ExxonMobil’s world-class offshore Guyana discoveries, with a gross recoverable resource of nearly 9 billion oil-equivalent barrels.
Revenue Growth & Strategic Moves Support U.S. Bancorp (USB)
Per Zacks analyst, organic growth backed by a rise in average loans and deposits remains a key strength at U.S. Bancorp.
Internet Subscriber Growth Aids Rogers Communications (RCI)
Per the Zacks analyst, Rogers Communications is benefiting from solid subscriber gain in the Internet segment and the shift of Internet users to higher-usage tiers.
New Downgrades
Lower Merchant Volumes, High Debt Ail Air Products (APD)
According to the Zacks analyst, lower merchant volumes amid weak industrial activities will weigh on the company’s top line. Its high debt level is another concern.
Urban Market Struggles to Hurt Equity Residential (EQR)
Per the Zacks Analyst, Equity Residential’s performance might remain choppy amid the health crisis, and prevailing flexible work scenario, low mortgage rates, and concessionary environment.
Global Blood’s (GBT) Dependence on One Drug A Concern
Per the Zacks analyst, Global Blood has only one approved product in its portfolio. If Oxbryta does not perform well, the business will be significantly impacted.
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Oracle Corporation (ORCL): Free Stock Analysis Report
3M Company (MMM): Free Stock Analysis Report
CocaCola Company The (KO): Free Stock Analysis Report
Chevron Corporation (CVX): Free Stock Analysis Report
The Boeing Company (BA): Free Stock Analysis Report
Adobe Inc. (ADBE): Free Stock Analysis Report
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Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
