Top Analyst Reports for Apple, Verizon & PayPal

Monday, June 1, 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 Apple (AAPL), Verizon Communications (VZ) and PayPal (PYPL). 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’s shares have outperformed the S&P 500 over the past year (+83.5% vs. +11.1%), with the the Zacks analyst expecting the outperformance continuing on the back of momentum in in the iPhone maker's Services segment, driven by strong App Store sales and the robust adoption of Apple Music and Apple Pay.

Non-iPhone devices, particularly Apple Watch and AirPod, are other notable drivers in the long haul. However, iPhone sales are expected to remain bleak in the near term due to the negative impact of the coronavirus. In fact, the company expects iPhone and Wearables business revenues for the fiscal second quarter to be worse on a year-over-year basis than the fiscal first quarter.

On the contrary, iPad and Mac revenues are expected to improve but lower economic activity will hurt AppleCare and advertising businesses. The company didn’t provide any guidance due to the pandemic-triggered uncertainty.

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

Shares of Verizon have lost -4.3% over the past six months against the Zacks Wireless National industry’s fall of -7.1%. The Zacks analyst believes that focus on online content delivery, mobile video and online advertising will likely stoke future growth.

Verizon's 5G Ultra Wideband network build up is likely to foster 5G roll out. It is also changing revenue mix toward newer growth services like cloud, security and professional services. However, Verizon continues to struggle in a competitive U.S. wireless market with muted demand and tweaked 2020 guidance amid the coronavirus-led turmoil.

The company's wireline division is struggling with losses in access lines due to competitive pressure from VoIP service providers. In addition, Verizon is spending heavily on promotion and lucrative discounts to woo customers, which further erodes profitability.

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

PayPal’s shares have gained +37.4% over the past three months against the Zacks Internet Software industry’s rise of +22.2%. The Zacks analyst believes that PayPal’s portfolio strength remains its key catalyst. Venmo’s improving monetization efforts and rising adoption rate across various platforms are aiding the total active accounts.

Further, robust mobile checkout services of One Touch are contributing to the company’s total payment volume growth. Furthermore, growing momentum of PayPal’s core peer to peer and merchant services is aiding in acceleration of payment volume. Additionally, improving trend in the company’s activation rate is a positive.

Also, benefits from Honey buyout are tailwinds. However, uncertainties induced by coronavirus pandemic remains a major headwind. Further, increasing credit loss reserves owing to macroeconomic projections on account of coronavirus is a serious matter of concern.  

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

Other noteworthy reports we are featuring today include BP p.l.c. (BP), Altria Group (MO) and General Electric (GE).

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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

Apple (AAPL) Banks on Services to Counter Coronavirus Chaos

Verizon (VZ) Rides on 5G, Focus on High-Growth Revenue Mix

PayPal (PYPL) Benefits From Increasing Total Payment Volume

Featured Reports

BP Banks on Upstream Projects, Refining Business Weak

BP has a strong portfolio of upstream projects which has been driving impressive production growth. However, the firm's weak refining business concerns the Zacks analyst.

Altria (MO) Troubled by Weak Cigarette Volumes, Pricing Aids

Altria has been battling soft cigarette shipment volumes due to regulatory hurdles and rising health consciousness. However, the Zacks analyst expects the company's solid pricing to remain a driver.

Restructuring Aids General Electric (GE), Power Segment Ails

Per the Zacks analyst, General Electric's business portfolio-restructuring program continues to lend momentum to it.

Medicare Business Aids, Rising Expenses Hurt Humana (HUM)

Per the Zacks analyst, Humana's well-performing Medicare business has led to its overall growth.

Divestment Strategy Aids L3Harris (LHX), Expanding Tariff Woes

Per the Zacks analyst, notable divestment strategies are expected to boost L3Harris' cash flow account.

Strategic Initiatives Aid, High Costs Hurt Centene (CNC)

Per the Zacks analyst, a number of mergers and acquisitions have boosted its Medicaid membership, which in turn has contributed to its revenues. However, escalating expenses continue to bother.

Investments, Customer Additions Assist Xcel Energy (XEL)

Per the Zacks analyst, Xcel Energy's ongoing investment will strengthen its electric and natural gas infrastructure and assist it to provide reliable services to its expanding customer base.

New Upgrades

Liquidity, Superior Debt Profile to Aid HollyFrontier (HFC)

The Zacks analyst likes HollyFrontier's ample liquidity with $900 million in cash and an undrawn $1.35 billion revolving credit facility. Further, the company's earliest debt maturity is in 2026.

Foot Locker (FL) Digital Endeavors to Aid Top-Line Growth

Per the Zacks analyst, Foot Locker's focus on enhancing e-commerce platform, growing direct-to-consumer operations, tapping of underpenetrated markets and opening of Power Stores bode well.

Loan Demand, Fee Income Aid BankUnited's (BKU) Profitability

Per the Zacks analyst, BankUnited will likely benefit from decent demand for loans and efforts to strengthen fee income sources despite lower rates.

New Downgrades

Volatile Cinema Product Sales Continue to Hurt Dolby (DLB)

Per the Zacks analyst, volatile cinema product sales due to coronavirus-induced social distancing coupled with higher licensing expenses are likely to affect Dolby's near-term performance.

Soft Demand to Hurt UFP Industries' (UFPI) Industrial Unit

Per the Zacks analyst, decline in customer demand in the Industrial segment owing to coronavirus-related disruptions will hurt UFP Industries.

Restructuring Charges & Coronavirus-Woes to Ail Aegion (AEGN)

Per the Zacks analyst, lower revenues across the business due to COVID-19 disruptions and restructuring-related charges are likely to hurt Aegion's performance in near term.

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Verizon Communications Inc. (VZ) : Free Stock Analysis Report
 
PayPal Holdings, Inc. (PYPL) : Free Stock Analysis Report
 
Altria Group, Inc. (MO) : Free Stock Analysis Report
 
General Electric Company (GE) : Free Stock Analysis Report
 
BP p.l.c. (BP) : Free Stock Analysis Report
 
Apple Inc. (AAPL) : Free Stock Analysis Report
 
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