Top Stock Reports for Mastercard, Petrobras & Walgreens Boots Alliance

Thursday, April 5, 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 Mastercard (MA), Petrobras (PBR) and Walgreens Boots Alliance (WBA). 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 >>>

Buy-rated Mastercard’s shares have increased 54.5% over the last year, significantly outperforming the Zacks Financial Transaction Services industry’s gain of 33.2% during the same period. The Zacks analyst likes its solid market position, ongoing expansion and digital initiatives.

Also, there are significant opportunities from the secular shift toward electronic payments. The acquisitions of VocaLink and NuData Security complement the company’s efforts to participate in new payment flows and enhance its safety and security offerings.

The stock has seen the Zacks Consensus Estimate for current-year earnings being revised upward over the last 60 days. It, however, continues to face increasing costs. Also, higher incentives and rewards will put pressure on the bottom line.

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

Shares of Petrobras have outperformed the Zacks Emerging Markets Integrated Oil industry over the last three months, gaining +21.5% vs. +11.7%. Adding to the bullishness, Brazil's flagship oil company reported robust fourth quarter results. While its strong free cash flow performance reflects operational improvement and lower investments, Petrobras has been able to partly revive its financial health through divestments and spin offs.

The company's ambitious plan to boost volumes by 27% through 2022 also looks achievable considering its impressive pre-salt reservoirs portfolio. However, Petrobras still carries a massive net debt of $85 billion, with net debt-to-capitalization ratio of 51%. Weak oil products sales volume in Brazil and lower margins at its downstream unit are other headwinds. As such, the Zacks analyst maintains a cautious stance on the stock.

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

Walgreens Boots Alliance’s shares have done better than the embattled Zacks Drug Stores industry over the last year (WBA is down -10.5% vs. decline of -13.4% for the peer group). Walgreens Boots reported better-than-expected second quarter fiscal 2018 results. This time the company witnessed its highest sales in the last eight quarters.

The Zacks analyst likes Walgreens Boots' increase in sales at the Retail Pharmacy International. Moreover, the company has been gaining on account of strategic tie-ups. The company’s alliance with Express Scripts aiming to expand their existing group purchasing efforts is another positive.

This apart, the company’s decision to acquire a 40% stake in Sinopharm Holding Guoda Drugstores in China looks promising as it should provide a strong impetus to Walgreens Boots’ worldwide retail pharmacy business. However, declining Retail Pharmacy sales at CER was a disappointment. The company faces tough competition along with currency fluctuations.

(You can read the full research report on Walgreens Boots Alliance here >>>).

Other noteworthy reports we are featuring today include Kimberly Clark (KMB), Microchip (MCHP) and Carnival (CCL).

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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

Digital Initiatives, Solid Balance Sheet Aid Mastercard (MA)

Petrobras (PBR) Aided by Pre-Salt Reserves, Free Cash Flow

Generic Drug Inflation Hurts Walgreens' (WBA) Pharmacy Margin

Featured Reports

Wirtgen Buyout, Strong Order Activity to Benefit Deere (DE)

Per the Zacks analyst, Wirtgen buyout will aid Deere's North America-centric construction business. Strong order activity in Combine Early Order Program and large tractors will also drive growth.

High IBG LLC Dependence to Hurt Interactive Brokers (IBKR)

Per the Zacks analyst, Interactive Brokers' dependence on IBG LLC is a concern as if it fails to provide funds for taxes, the company's financials may suffer. Focus on Electronic segment aids growth.

Darden (DRI) Gains From Acquiring Cheddar's Amid Competition

The Zacks analyst notes that Darden's acquisition of Cheddar's has added value to the company's portfolio of differentiated brands. However, a competitive industry poses challenge.

Carnival (CCL) Rides on Higher Revenue Yield, High Cost Ails

The covering analyst is encouraged by Carnival's effort to enhance revenue yield from high ticket prices amid increased demand.

Extra Space (EXR) to Benefit From Strategic Acquisitions

Per the Zacks analyst, Extra Space Storage is poised to gain from its high brand value, strategic acquisitions & robust presence in key cities.

Freight Revenues Buoy Canadian Pacific (CP) Amid Debt Woes

The Zacks analyst likes the strong performance of the intermodal unit, which is aiding the company's overall freight revenues.

Loan Growth Aids Huntington (HBAN), Concentration Risk a Woe

The Zacks analyst believes that improving economy has helped Huntington witness growth in loan and deposits.

New Upgrades

Customer Growth, Systematic Investments Aid IDACORP (IDA)

Per the Zacks analyst, economic improvements in IDACORP's service territories is expanding its customer base. Ongoing investments to strengthen its operations will continue to boost performance.

Booming Electronic Payments Market Boosts Verifone (PAY)

The Zacks analyst likes VeriFone's dominant position in the electronic payment systems and services market. Robust product portfolio is a positive. Growth prospects from buyouts raise optimism.

Kimberly-Clark's (KMB) Restructuring Plans to Fuel Earnings

Kimberly-Clark expects cost savings of over $2 billion from its FORCE Program and 2018 Global Restructuring Program over the next four years. Per the Zacks analyst, this is likely to fuel bottom-line.

New Downgrades

Telefonica Brasil (VIV) Hurt by Continued Customer Churn

Per the Zacks analyst, continued losses in fixed line voice business and shift in customers to discounted calling rate offers from national wireless operators have hurt Telefonica Brasil revenues.

High Costs Supress MarketAxess' (MKTX) Margins

Per the Zacks analyst increasing expenses have weighed on the company's margins and the same are expected to rise over the coming quarters given its ongoing investments in business expansion.

Rising Lead Time & Stiff Competition Hurts Microchip (MCHP)

Per the Zacks analyst, Microchip is adversely impacted by exchange rate volatility, increasing lead time, significant exposure to Asian markets and competition from peers.

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Walgreens Boots Alliance, Inc. (WBA) : Free Stock Analysis Report
 
Petroleo Brasileiro S.A.- Petrobras (PBR) : Free Stock Analysis Report
 
Microchip Technology Incorporated (MCHP) : Free Stock Analysis Report
 
Mastercard Incorporated (MA) : Free Stock Analysis Report
 
Kimberly-Clark Corporation (KMB) : Free Stock Analysis Report
 
Carnival Corporation (CCL) : Free Stock Analysis Report
 
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