Tuesday, March 29, 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), The Procter & Gamble Company (PG), and Chevron Corporation (CVX). 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 have gained +47.3% over the past year against the +16% gain for the S&P 500 index. The Zacks analyst sees Apple continuing to benefit from momentum in Services and robust performance from iPhone, Mac, Wearables and an expanding App Store ecosystem. Availability of new Mac Studio, new iPad Air and the most affordable iPhone SE. Apple TV+ is gaining recognition with shows like Ted Lasso winning Emmy and CODA wining Academy Award for Best Picture.
However, Apple did not provide revenue guidance for the second quarter of fiscal 2022, given the uncertainty around the impact of the pandemic. Nevertheless, Apple expects to achieve solid year-over-year revenue growth and set a second quarter revenue record despite significant supply constraints, which it estimates to be less than the fiscal first quarter.
(You can
read the full research report on Apple here >>>
)
Shares of
Procter & Gamble
have outperformed the Zacks Soap and Cleaning Materials industry over the past year (+16.4% vs. +4.5%) on the back of impressive operational performance in an otherwise tough operating envoronment. This is reflected in the company’s strong recent quarterly results that show improved productivity amid cost headwinds, along with the rising demand for cleaning products due to the resurgence of COVID-19 cases. Management lifted its fiscal 2022 view.
The company has witnessed SG&A expense leverage, owing to savings from overhead and marketing expenses, and cost leverage gains due to higher sales and real estate. However, unfavorable mix, commodity cost inflation, increase in freight costs, product and packaging investments and other impacts hurt margins. It expects higher commodity and freight costs to persist in fiscal 2022.
(You can
read the full research report on Procter & Gamble here >>>
)
Shares of
Chevron
have lost some ground lately in ‘solidarity’ with the recent pullback in crude oil prices, but the stock remains a standout performer relative to the Zacks Oil and Gas – Integrated – International industry over the past year (+64.8% vs. +49.9%). In the accompanying research report linked below, the Zacks analyst describes the company as considered one of the best-placed global integrated oil firms to achieve sustainable production ramp-up. America’s No. 2 energy company’s existing project pipeline is among the best in the industry, thanks to its premier position in the lucrative Permian Basin.
However, Chevron was not immune to the commodity price crash of 2020, forcing it to cut spending substantially. The company’s high oil price sensitivity is a concern too. Moreover, the supermajor’s 10-year reserve replacement ratio of 100% is indicative of its inability to replace the amount of oil and gas produced. Finally, Chevron has been a laggard to jump into the net-zero bandwagon.
(You can
read the full research report on Chevron here >>>
)
Other noteworthy reports we are featuring today include Novo Nordisk A/S (NVO), NextEra Energy, Inc. (NEE) and Canadian Natural Resources Limited (CNQ).
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)
High Demand & Productivity Plan Drives P&G’s (PG) Growth
Chevron (CVX) to Gain from Massive Permian Acreage
Featured Reports
Novo Nordisk’s (NVO) Diabetes Drugs Aid Growth Amid Rivalry
Per the Zacks analyst, Novo Nordisk has a strong presence in the Diabetes Care market which is driving growth. However, patent expiry on some of the products remains a major concern for the company
Steady Investment & Renewable Focus Aid NextEra Energy (NEE)
Per the Zacks analyst, NextEra’s planned capital investment to enhance clean electricity generation and strengthen its infrastructure will boost its profitability.
Supply-chain Woes Ail Norfolk Southern (NSC), Dividends Aid
The Zacks analyst is impressed with the company’s efforts to reward its shareholders. However, disruption in operations due to the supply-chain crisis is concerning
Surging Orders to Drive Fortive (FTV) Amid High Leverage
While strong customer demand and increasing orders for hardware offerings are likely to buoy Fortive’s top line, the Zacks analyst remains concerned of the firm’s highly leveraged balance sheet.
Robust Revenues & Cash Flows Aid American Express (AXP)
Per the Zacks analyst, rebounding economic recovery and increased consumer spending are likely to contribute to the top line. Also, robust cash flows have enabled investments in business.
Inorganic Growth Aids Citizens Financial (CFG), High Costs Ail
Per the Zacks analyst, Citizens Financial’s inorganic growth moves will expand its product capabilities and geographic reach. However, rising costs and concentrated portfolio risk are major headwinds.
High COVID Testing Volumes Aid LabCorp (LH), Forex Woes Ail
The Zacks analyst is encouraged by LabCorp’s greater-than-anticipated COVID-19 testing volumes. Howeve, unfavorable currency movements continue to hamper growth.
New Upgrades
Diverse Production Mix Aids Canadian Natural (CNQ)
The Zacks analyst believes that Canadian Natural’s diverse production mix of synthetic oil, heavy crude oil, natural gas and light crude oil facilitates long-term value and reduces risk profile.
PBF Energy (PBF) to Gain From Renewable Diesel Fuel Project
Per the Zacks analyst, PBF Energy is expected to gain from its renewable fuel production facility in the Chalmette refinery, contributing to growth of sustainable biofuels.
Nu Skin (NUS) Likely to Gain on Impressive Product Launches
Per the Zacks analyst, Nu Skin is gaining from its solid focus on innovations. Management is on track to launch Beauty Focus Collagen+ and ageLOC Meta along with two connected devices in 2022.
New Downgrades
Post Holdings’ (POST) Performance Hurt by Cost Inflation
Per the Zacks analyst, Post Holdings is grappling with escalated costs. Raw material and freight inflation along with higher manufacturing costs hurt its fiscal first-quarter performance.
Higher Production Costs Ail Agnico Eagle Mines (AEM)
The Zacks analyst is concerned that higher costs of consumables and supplies will have an unfavorable impact on the company’s production costs and weigh on its bottom line.
Adtalem’s (ATGE) Lower Enrollment and Higher Costs Hurt
Per the Zacks analyst, low enrollment of new and total students, COVID-related headwinds, higher cost of educational and student services as well as administrative expense have been hurting Adtalem.
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