Monday, December 12, 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 JPMorgan Chase & Co. (JPM), Intel Corp. (INTC) and Advanced Micro Devices, Inc. (AMD). 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 >>>
Shares of
JPMorgan
have outperformed the Zacks Banks – Major Regional industry over the past six months (+13.9% vs. +4.2%). In fact, JP Morgan’s third-quarter 2022 results show positive effects of higher rates and solid loan demand as well as robust trading performance, while a worsening macroeconomic outlook was a headwind.
The Zacks analyst believes that opening new branches, strategic buyouts/investments and global expansion and digitization efforts will keep driving financials. Higher rates and a steady rise in loan demand will keep aiding net interest income (NII). Yet, the volatile nature of the capital markets business and higher mortgage rates are likely to make fee income growth tough. Steadily rising expenses remain a key issue.
(You can
read the full research report on JPMorgan here >>>
)
Intel
’s shares have declined -45.2% over the year to date period against the Zacks Semiconductor – General industry’s loss of -37.3%. The tech giant reported mixed third-quarter 2022 results, wherein the bottom line beat the Zacks Consensus Estimate while the top line missed. Both revenues and earnings declined year over year, owing to a challenging macroeconomic environment and softening demand trends.
The Zacks analyst believes that production delays pertaining to its 7 nm ramp up remain a concern. An imposition of fresh lockdown restrictions in some markets, forex woes and high debt burden are other headwinds. It is witnessing intensifying competition in the server, networking and storage markets, while inflated raw material costs and signs of market saturation are worrisome.
The Sino-US trade war is also adversely impacting its growth prospects. However, its Mobileye growth should be driven by design wins amid recovering automotive industry. Recovery in the enterprise business of the data center segment is a positive.
(You can
read the full research report on Intel here >>>
)
Advanced Micro Devices
’ shares have declined -48.7% over the past year against the Zacks Electronics – Semiconductors industry’s loss of -25.9%. The Zacks analyst believes that Advanced Micro Devices’ data center GPU revenues were down significantly year over year against tough comparisons.
Nevertheless, AMD witnessed record sales of Xilinx FPGA and networking data center products. Pensando DPUs also witnessed strong demand. However, Client segment revenues declined year over year reflecting declining PC shipment.
AMD’s third-quarter 2022 results benefited from higher Data Center and Embedded revenues. It’s Data Center sales benefited from strong sales of third-gen EPYC server processors. Cloud revenues more than doubled year over year and increased sequentially as multiple hyperscalers expanded the deployment of EPYC processors.
(You can
read the full research report on Advanced Micro Devices here >>>
)
Other noteworthy reports we are featuring today include Moderna, Inc. (MRNA), Target Corp. (TGT) and Suncor Energy Inc. (SU).
Mark Vickery
Senior Editor
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
Higher Rates, Buyouts Aid JPMorgan (JPM), Fee Income a Woe
Intel (INTC) Rides on Mobileye & Data Center Business
Robust Product Portfolio & Partnerships Aid AMD’s Prospects
Featured Reports
Moderna’s (MRNA) Dependence on COVID Vaccine Revenues A Woe
Though Moderna’s COVID vaccine sales have significantly boosted its cash resources, the Zacks Analyst is concerned since the company’s other pipeline candidates are years away from commercialization.
Consistent Investments, Renewable Focus Aid AVANGRID (AGR)
Per the Zacks analyst AVANGRID’s regular investments to strengthen infrastructure and expand clean energy generation assets are going to drive its operation.
Pro-Investor Steps Boost Gartner (IT) Despite Low Liquidity
Per the Zacks analyst, Gartner’s endeavor to reward its shareholders through share repurchases is appreciable. However, low current ratio is a headwind.
Soft Comps & Margin Performance Concerns for Target (TGT)
Per the Zacks analyst, soft comps and weak margins are concerns for Target. Sales witnessed a soft start in November. The company expects a low-single-digit decline in fourth-quarter comps.
Hologic (HOLX) Surgical Volume Grows, Margin Pressure Ails
The Zacks analyst is impressed with Hologic’s Surgical business growth on procedural volumes return as well as acceleration from the new business lines. Mounting expenses put pressure on margins.
Built-to-Order Model Aids Toll Brothers (TOL), High Rates Ail
Per the Zacks analyst, Built-to-Order process enables homebuyers personalize their homes irrespective of prices, thus giving Toll Brothers competitive edge over its peers. Rising mortgage rates hurt.
Suncor (SU) Buoyed by Integrated Business Model
The Zacks analyst believes that Suncor’s integrated business model positions it well for strong cash flow generation. However, the company’s high oil price sensitivity is a concern.
New Upgrades
Manageable Costs, Business Restructuring Aid Barclays (BCS)
Per the Zacks analyst, Barclays’ cost-saving efforts are expected to continue to aid the bottom line in the near term. Its restructuring and business-simplifying efforts will likely boost financials.
Strong Automotive Insurance Vertical Drives EverQuote (EVER)
Per the Zacks analyst, EverQuote is set to grow on solid performance of automotive and other insurance marketplace verticals. Increasing consumer traffic and higher quote request volume are positives.
Phillips 66 (PSX) Banks on More Stable Midstream Business
The Zacks analyst likes Phillips 66 since the company is shifting its focus toward more stable midstream operations. The firm is also improving its refining performance.
New Downgrades
Increased Cat Loss & Elevated Debt Level Hurt Allstate (ALL)
Per the Zacks analyst, exposure to catastrophic events continues to dent underwriting profitability. Rising debts remain a concern as it leads to escalated interest expenses.
Qorvo (QRVO) Plagued by Soft End Market Demand, Supply Woes
Per the Zacks analyst, Qorvo is likely to be plagued by continued weakness across end markets, acute inventory correction, COVID mitigation efforts in China and global supply chain disruptions.
Higher Input Costs, Currency Ail Element Solutions (ESI)
Per the Zacks analyst, higher raw material and logistics costs will hurt the company’s margins. Unfavorable currency translation due to a stronger U.S. dollar will also affect its performance.
Zacks Top 10 Stocks for 2023
In addition to the investment ideas discussed above, would you like to know about our 10 top picks for the entirety of 2023? From inception in 2012 through November, the Zacks Top 10 Stocks portfolio has tripled the market, gaining an impressive +884.5% versus the S&P 500’s +287.4%.
Now our Director of Research is combing through 4,000 companies covered by the Zacks Rank to handpick the best 10 tickers to buy and hold. Don’t miss your chance to get in on these stocks when they’re released on January 3.
Be First to New Top 10 Stocks >>
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
