Tuesday, March 24, 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 Visa (V), Bank of America (BAC) and Citigroup (C). 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 >>>
Visa’s shares have outperformed the Zacks Financial Transaction Services over the past six months (-22.5% vs. -27.8%). The Zacks analyst believes that the company is likely to see a slowdown in its cross-border business due to coronavirus outbreak.
Numerous acquisitions and alliances plus technology upgrades and effective marketing have paved the way for long-term growth and consistent increase in revenues. Shift in payments such as mobile, cards and online paved way for long-term growth and led to an increase in payments volume, cross-border volume and processed transactions.
The acquisition of Visa Europe is a long-term growth strategy for the company. Its international business has been expanding and adds diversification benefits. Its strong capital position is another positive. However, high client incentives and expenses weigh on its operating margin.
(You can read the full research report on Visa here >>>)
Shares of Bank of America have lost 28.3% over the past year against the Zacks Major Regional Banks’ fall of 35.1%. The Zacks analyst believes that opening branches in new regions, improved digital offerings, decent loan demand and efforts to control costs are expected to aid profitability despite near-zero interest rates.
Efforts to focus more on consumer banking business have started bearing fruit. The company's enhanced capital deployment actions reflect a solid liquidity position. However, significant dependence on capital markets performance makes us apprehensive, given its cyclical nature.
This is likely to hurt the company’s fee income growth, and in turn negatively affect the top line. A stretched valuation limits the stock's upside potential.
(You can read the full research report on Bank of America here >>>)
Citigroup’s shares have lost 50.9% over the past three months against the Zacks Major Regional Banks industry’s fall of 49%. The Zacks analyst believes that Citigroup’s streamlining efforts, along with strategic investments in core business, bode well for the long term.
Further, net interest revenues will likely be supported by loan growth and mix, despite low rates. Moreover, prudent expense management is likely to aid bottom-line expansion. However, pending litigation issues might keep legal expenses elevated.
Additionally, decline in equity-market revenues and volatile underwriting business are concerns. Notably, the current economic environment is uncertain due to the coronavirus outbreak and the company has temporarily suspended share buybacks through the second quarter of 2020.
(You can read the full research report on Citigroup here >>>)
Other noteworthy reports we are featuring today include Netflix (NFLX), Danaher (DHR) and Duke Energy (DUK).
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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
Visa (V) Rides On Solid Balance Sheet, Increasing Revenues
Expense Saving Aids Bank of America (BAC) Amid Low Rates
Expense Control Aids Citigroup (C), Low Fee Income A Woe
Robust Content Aids Netflix (NFLX) Amid Stiff Competition
Per the Zacks analyst, Netflix's robust content portfolio is driving subscriber addition.
BioPharma Acquisition to Drive Danaher (DHR), High Costs Ail
Per the Zacks analyst, strength in Danaher's Life Sciences business, coupled with its buyout of BioPharma business will continue to lend momentum to the company.
Investments to Benefit Duke Energy (DUK), Rising Costs Woe
Per the Zacks analyst, Duke Energy's robust capital expenditure plan will bolster earnings base growth for the company.
Dollar General's (DG) Sturdy Comps Run to Propel Top-Line
Per the Zacks analyst, the company's better price management, merchandise, cost containment and operational initiatives should drive sales.
Travelers' (TRV) Auto & Homeowners Aids, Cat Loss Hurts
Per the Zacks analyst, persistent progress and strong market of the auto and homeowners businesses contribute to revenue growth of the company.
New Features & Security Focus Drives Twitter's (TWTR) Growth
Twitter continues to add new features and ramp up its security efforts to lower abuse, which per the Zacks analyst is boosting engagement levels, thereby aiding top-line growth.
Expansion Strategies Aid Hilton (HLT) Amid Coronavirus Woes
Per the Zacks analyst, Hilton's business benefits from expansion strategies, industry-leading loyalty program and the asset-light business model. However, novel coronavirus outbreak poses a risk.
eBay (EBAY) Rides on Solid Momentum Across Managed Payments
Per the Zacks analyst, eBay is benefiting from strengthening managed payments offerings which deliver better shopping experience. This in turn is aiding the company's customer momentum.
Mattel (MAT) Banks on Barbie Sales & Cost Saving Efforts
Per the Zacks analyst, simplification in its organizational structure as well as optimization in process and supply chains, along with high Barbie sales globally, are likely to benefit the company.
Geron's (GERN) Sole Candidate Imetelstat Holds Potential
Per the Zacks analysts, Geron is progressing well with its sole pipeline candidate, imetelstat, which is being evaluated in mid-to late-stage studies for treating hematologic myeloid malignancies.n
Autoliv (ALV) to be Hurt by Lower Light Vehicle Production
Per the Zacks Analyst, the firm expects light-vehicle markets to witness slump due to softening consumer confidence, trade tariffs and regulatory changes, going forward.
PBF Energy's (PBF) High Debt to Hurt Financial Flexibility
The Zacks analyst is concerned as PBF Energy's levered balance sheet will reduce its financial flexibility. Moreover, declining refining margin can affect the firm's business.
Labor Shortage Issue, Stiff Competition Hurts AAR Corp (AIR)
Per the Zacks Analyst, labor shortage issues in the company's MRO business, limits growth. Further, the company is subject to stiff market competition due to peer price pressure.
Visa Inc. (V) : Free Stock Analysis Report
Netflix, Inc. (NFLX) : Free Stock Analysis Report
Duke Energy Corporation (DUK) : Free Stock Analysis Report
Danaher Corporation (DHR) : Free Stock Analysis Report
Citigroup Inc. (C) : Free Stock Analysis Report
Bank of America Corporation (BAC) : Free Stock Analysis Report
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