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Top Analyst Reports for Apple, Berkshire Hathaway, & S&P Global

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·6-min read
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Thursday, May 19, 2022

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 Apple Inc. (AAPL), Berkshire Hathaway Inc. (BRK.B), and S&P Global Inc. (SPGI). 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 >>>

Apple shares are down -18% in the year-to-date period, modestly underperforming the broader market's -16.2% decline, but they have held up better than the Zacks Tech sector's -26.7% pullback. While overall sentiment on the entire space remains negative, Apple remains well positioned given momentum in the services and robust performance from iPhone, Mac, Wearables and an expanding App Store ecosystem. The availability of new Mac Studio and new iPad Air is expected to drive top-line growth. Apple TV+ is gaining recognition due to award-winning shows. This bodes well for the Services segment.

However, Apple did not provide revenue guidance for the third quarter of fiscal 2022. Apple expects COVID-induced supply chain disruptions and industry-wide silicon shortages to hurt the top line by $4-$8 billion. Unfavorable forex conditions along with the absence of Russian revenues are also expected to hurt the top line.

(You can read the full research report on Apple here >>>)

Shares of Berkshire Hathaway have outperformed the Zacks Insurance - Property and Casualty industry over the past year (+6.5% vs. -0.9%). The company is one of the largest property and casualty insurance companies measured by premium volume. Berkshire's inorganic growth story remains impressive with strategic acquisitions. A strong cash position supports earnings-accretive bolt-on buyouts and indicates the company's financial flexibility.

Continued insurance business growth fuels increases in float, drive 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 the further impetus. 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.

(You can read the full research report on Berkshire Hathaway here >>>)

S&P Global shares have declined -11.5% over the past year against the Zacks Business - Information Services industry’s decline of -13.6%. The company remains vulnerable to proceedings, investigations, and inquiries with respect to the ratings provided, leading to legal charges, damages, or fines. Growth initiatives, higher compensations, and incentives raise the company's expenses. Decreasing current ratio is not desirable as it indicates that the company may have problems meeting its short-term debt obligations. Partly due to these headwinds, the stock has declined in the past year.

However, The Zacks analyst believes that S&P Global remains well poised to gain from the growing demand for business information services. Buyouts help innovate, increase differentiated content and develop new products. Effective management execution has helped it generate solid cash flow which is utilized for growth initiatives. Dividend payments and share buybacks boost investor’s confidence and positively impact earnings per share.

(You can read the full research report on S&P Global here >>>)

Other noteworthy reports we are featuring today include Comcast Corporation (CMCSA), GlaxoSmithKline plc (GSK), and Cigna Corporation (CI).

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

Robust Portfolio, Services Strength to Benefit Apple (AAPL)

Solid Insurance Business Aid Berkshire (BRK.B), Cat Loss Ail

S&P Global (SPGI) Benefits From Acquisitions Amid High Debt

Featured Reports

Broadband Subscriber Gain Drives Comcast's (CMCSA) Prospects
Per the Zacks Analyst, Comcast benefits from an expanding broadband subscriber base as well as strong adoption of Xfinity, Flex and Peacock.

Glaxo's (GSK) Specialty Drugs Driving Sales in 2022
Glaxo's specialty products like Dovato, Nucala, Trelegy Ellipta, Shingrix are driving sales, making up for a lower sales of established drugs due to generic erosion, per the Zacks analyst.

Cigna (CI) Benefits from Growing Revenues, Strong Cash Flows
Per the Zacks analyst, Cigna gains from a healthy revenue stream, driven by buyouts and enhanced products suite. Further, the company's cash-generating abilities enable investment in the business.

Solid Demand Aids Northrop (NOC), Supply Chain Turmoil Woes
Per the Zacks analyst, strong global demand for its products like Triton and E-2D Advanced Hawkeyes steadily boosts Northrop. Yet COVID-19 induced supply chain disruption might hurt the stock.

Ecolab (ECL) Continues to Gain From a Solid Product Suite
The Zacks analyst is upbeat about Ecolab's robust product portfolio despite its information technology systems being potentially vulnerable to data security threats.

Low Breakeven Costs to Aid Marathon Oil's (MRO) Cash Flows
The Zacks analyst believes that Marathon's extremely low oil price breakeven costs of just $35 a barrel should generate meaningful free cash flows and improve future profitability.

Aspen (AZPN) to Gain From Product Portfolio & Acquisitions
Per the Zacks analyst, Aspen's diversified product portfolio is witnessing heathy momentum. The integration with Emerson's OSI Inc and the Geological Simulation Software business also bodes well.

New Upgrades

Nucor (NUE) Gains on Strong Demand, Higher Steel Prices
Per the Zacks analyst, Nucor will benefit from strong demand in its end markets, especially non-residential construction. Higher steel prices will also act as a catalyst for its steel mills unit.

Balance Sheet Strength, Buyout Aids M&T Bank (MTB) Growth
Per the management, M&T Bank's organic growth driven by higher fee income, loans and deposits will likely increase the company's revenues. Inorganic growth backed by a sound liquidity position aids.

Delta (DAL) Aided by Continued Recovery in Air-Travel Demand
Per the Zacks analyst, steady recovery in air-travel demand is driving Delta's top line. Additionally, strong demand and favorable yields are boosting the company's cargo revenues.

New Downgrades

Macro Pressure, Supply Chain Issues Hurt Bausch Health (BHC)
Per the Zacks analyst, Bausch's business is being hurt by macro pressures and a challenging supply chain environment. The Omicron resurgence has impacted primary care and nursing home capacity.

Cost Inflation Hurts HanesBrands' (HBI) Operating Margin
Per the Zacks analyst, HanesBrands has been battling cost inflation. The company's first-quarter adjusted operating margin contracted nearly 280 basis points due to inflation among other reasons.

Staffing Challenges & Inflation Hurt Brinker's (EAT) Prospects
Per the Zacks analyst, Brinker has been experiencing Omicron-induced staffing and supply-chain challenges. Also, rise in commodity inflation and restaurant labor cost is a concern.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
GlaxoSmithKline plc (GSK) : Free Stock Analysis Report
Apple Inc. (AAPL) : Free Stock Analysis Report
Comcast Corporation (CMCSA) : Free Stock Analysis Report
Berkshire Hathaway Inc. (BRK.B) : Free Stock Analysis Report
Cigna Corporation (CI) : Free Stock Analysis Report
S&P Global Inc. (SPGI) : Free Stock Analysis Report
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