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Top Stock Reports for UnitedHealth, Danaher & Abbott

Monday, May 20, 2024

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 UnitedHealth Group Incorporated (UNH), Danaher Corporation (DHR) and Abbott Laboratories (ABT), as well as a micro-cap stock Ark Restaurants Corp. (ARKR). The Zacks microcap research is unique as our research content on these small and under-the-radar companies is the only research of its type in the country.

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 >>>

UnitedHealth shares have outperformed the Zacks Medical - HMOs industry over the past year (+10.8% vs. +10.6%). The company’s top line remains poised for growth on the back of a strong market position, new deals, renewed agreements and expansion of service offerings. The company’s solid health services segment provides diversification benefits.

The Government business remains well-poised for growth in the future. Adjusted net earnings per share are anticipated to be in the $27.5-$28.00 band in 2024, higher than the 2023 reported figure of $25.12. A sturdy balance sheet enables business investments and prudent deployment of capital via share repurchases and dividend payments.

However, membership in its global business continues to be a concern. High operating costs due to rising medical expenses are hurting margins. As such, the stock warrants a cautious stance.

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

Shares of Danaher have outperformed the Zacks Diversified Operations industry over the past year (+30.7% vs. +11.7%). The company’s Life Sciences unit is witnessing support from stable demand in the academic and applied markets. The segment has been witnessing positive responses toward its new products. The company’s commitment to return value to shareholders is encouraging.

Synergies from the Abcam acquisition bolster the company’s growth. Through its DBS initiatives, it has been able to reduce the impact of supply-chain constraints and inflationary pressures.

However, Danaher is plagued by weakness in the Biotechnology unit due to decreased demand in the bioprocessing business. Softness in the funding environment and lower underlying activity levels are affecting the high-growth markets’ performance. High debt levels may raise its financial obligations and drain its profitability. Given its international exposure, forex woes are weighing on its top line.

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

Abbott shares have gained +3.2% over the past six months against the Zacks Medical - Products industry’s gain of +11.7%. The company’s pipeline is generating several new growth prospects, which will help sustain the positive momentum and contribute to the strong growth projection in 2024.

Alinity, the company’s next-generation suite of systems, is a key driver in the core lab diagnostics business. EPD's impressive stretch of strong performance stems from the company’s unique business model. Freestyle Libre CGM device is also on a great trajectory, continually outpacing market growth.

Within Nutrition, after a period of hiccups, Abbott has finally reestablished itself as the market leader in the infant formula business, underscoring strong customer confidence in the company's products. However, the slump in COVID-19 testing-related sales is hurting Abbott’s overall growth. Tough macro conditions also pose a concern for its operations.

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

Shares of Ark Restaurants have underperformed the Zacks Retail - Restaurants industry over the past six months period (-3.8% vs. +1.6%). This microcap company of market capitalization of less than $100 million is facing rising operational costs in food and supplies, pressing margins. The company's sensitivity to economic shifts threatens dining spending, impacting revenues.

Lease obligations and the need to refresh premises could negatively impact cash flow. Shifts in consumer preferences and weather can disrupt operations. Reliance on key locations, rising labor and regulatory costs, competition, and cybersecurity risks pose threats.

Yet, Ark Restaurants' financial management, revenue resilience in the fiscal first quarter of 2024, diverse portfolio, and strategic expansion signal growth potential. Investments in infrastructure and operational efficiency aim at profitability. The company could potentially capitalize on the food service industry, which is projected to witness a robust expansion.

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

Other noteworthy reports we are featuring today include Intuit Inc. (INTU), CME Group Inc. (CME) and Marathon Petroleum Corporation (MPC).

Director of Research

Sheraz Mian

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

Solid Top Line & Strong Cash Flows Drive UnitedHealth (UNH)

ADVERTISEMENT

Strong Life Sciences Unit Aids Danaher (DHR), High Debt Ails

Market Share Gain, EPD Business Growth Aid Abbott (ABT)

Featured Reports

Intuit (INTU) Rides on Product Refresh, Higher Subscriptions
Per the Zacks analyst, Intuit is benefiting from frequent product refreshes, which help it to gain customers. Moreover, increase in subscriptions is driving stable revenue growth for the company.

CME Group (CME) Banks on Improving Top Line, Expenses Hurt
Per the Zacks analyst, its strong revenues driven by organic growth, steady market position and diverse product lines has led to significant growth. However, escalating expenses hurt its margins.

Electromechanical Group Segment Strength Aids AMETEK (AME)
Per the Zacks analyst, AMETEK is benefiting from strong Electromechanical Group segment, driven by positive contributions from Paragon Medical and Bison Engineering buyouts.

NetApp (NTAP) Performance Gains Strong Product Portfolio
Per the Zacks analyst, NetApp's performance gains from demand for product portfolio, especially an expanded all-flash product portfolio, amid data-driven digital and cloud transformation.

Technology Expansion Aids Envestnet (ENV) Amid Nil Dividends
Per The Zacks analyst, Envestnet's continuous focus on technology development is helping it improve operational efficiency. No plan to pay out cash dividends is a negative.

Solid Demand for VantageCloud Aids Teradata's (TDC) Progress
Per the Zacks analyst, Teradata is benefiting from strong demand for its VantageCloud solution and strong recurring revenue growth.

Agios' (AGIO) Progress With Pyrukynd Encouraging
Though Agios is entirely dependent on sole marketed drug Pyrukynd for growth, the Zacks Analyst is encouraged by the drug's label expansion studies in thalassemia and sickle cell disease indications.

New Upgrades

Marathon's (MPC) Buyback Focus Improves Shareholder Return
The Zacks analyst likes Marathon Petroleum's commitment to shareholder value through aggressive buybacks. Since May 2021, it has executed $35 billion in repurchases, nearly halving its share count.

Favorable Budget, Solid Contract Wins Aid Leidos (LDOS)
Per the Zacks analyst, increasing budgetary revisions by the U.S. administration should boost Leidos' growth. Steady contract wins also bolster this stock' revenue prospects

Enrollment Growth & Cost-Saving Plans Aid Adtalem (ATGE)
Per the Zacks analyst, Adtalem is benefiting from growth in enrollments and efficient cost-saving initiatives. Also, its focus on strategic collaborations and innovation bode well.

New Downgrades

Soft Demand to Hurt Capri Holdings (CPRI) Top Line
Per the Zacks analysts, sluggish demand for luxury fashion items is likely to hurt Capri Holdings' top line. We note that the company is seeing soft sales across its brands.

Healthy Demand for Premier Office Spaces Aids SL Green (SLG)
Per the Zacks analyst, healthy demand for premier office properties and a solid tenant base bode well for SL Green. However, elevated supplies of office spaces and high interest rates are concerning

Rising costs and Forex Woes Impede Envista' (NVST) Growth
The Zacks analyst is worried about Envista facing challenging macroeconomic conditions resulting in a significant escalation in its expenses. Adverse currency movement continues to pose concerns.

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

Abbott Laboratories (ABT) : Free Stock Analysis Report

CME Group Inc. (CME) : Free Stock Analysis Report

UnitedHealth Group Incorporated (UNH) : Free Stock Analysis Report

Danaher Corporation (DHR) : Free Stock Analysis Report

Intuit Inc. (INTU) : Free Stock Analysis Report

Ark Restaurants Corp. (ARKR): Free Stock Analysis Report

Marathon Petroleum Corporation (MPC) : Free Stock Analysis Report

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Zacks Investment Research