Top Analyst Reports for Alphabet, Bank of America & Charles Schwab

Tuesday, June 21, 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 Alphabet Inc. (GOOGL), Bank of America Corporation (BAC), and The Charles Schwab Corporation (SCHW). 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 >>>

Alphabet shares have held up a lot better than the peer group in the ongiong market pullbsack, with stock losing -9.5% of its value over the past year against Zacks Internet - Services industry’s decline of -26.1%. While rising expenses and issues related to regulatory uncertainty are worrisome, Alphabet's strong cloud division is aiding substantial revenue growth. Moreover, expanding data centers will continue to bolster its presence in the cloud space. Further, major updates in its search segment are enhancing the search results. Moreover, Google’s mobile search is gaining solid momentum.

Also, a strong focus on innovation of AI techniques and the home automation space should aid business growth in the long term. Further, its deepening focus on the wearables category remains a tailwind. Furthermore, the company’s growing efforts to gain a foothold in the healthcare industry are other positives. Also, Alphabet’s expanding presence in the autonomous driving space is contributing well.

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

Bank of America shares have declined -18% over the past year, better than JPMorgan's -23.3% decline but worse than the S&P 500 index's -14.1% pullback. Weighing on the BAC shares and the broader group is lingering recession fears as reflected in the flattening yield curve that is offsetting the margin benefits of the Fed's tightening cycle.  

However, opening of new financial centers, enhancement in digital capabilities and cost-saving efforts will likely keep aiding financials. Supported by robust loan growth and the investment banking (IB) pipeline, the company’s top line is expected to keep improving in the quarters ahead. The company will keep enhancing shareholder value through impressive capital deployments.

(You can read the full research report on Bank of America here >>>)

The Charles Schwab shares have declined -11.7% over the past year against Zacks Financial - Investment Bank industry’s decline of -22.1%. The company’s elevated operating expenses might hamper its bottom-line growth to some extent. However, strategic acquisitions, likely to be earnings accretive, have reinforced Schwab's position as a leading brokerage player.

The company's offering of commission-free trading has led to a rise in client assets and brokerage accounts, thereby improving trading revenues. Schwab's efficient capital deployments reflect a solid balance sheet position, through which it will enhance shareholder value.

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

Other noteworthy reports we are featuring today include GSK plc (GSK), Caterpillar Inc. (CAT) and Starbucks Corporation (SBUX).

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

Alphabet (GOOGL) Benefits From Cloud & Search Initiatives

Cost Saving Efforts Aid Bank of America (BAC), Low Rates Ail

Strategic Acquisitions Aid Schwab (SCHW) Amid Cost Concerns

Featured Reports

Glaxo's (GSK) Specialty Drugs Driving Sales in 2022
Glaxo's specialty products like Dovato, Nucala, Trelegy Ellipta, Shingrix are driving sales, making up for a lower sales of established drugs due to generic erosion, per the Zacks analyst.

Caterpillar (CAT) to Gain on Strong Demand in End Markets
Per the Zacks analyst, solid backlog, improving end-market demand and focus on making strategic investments in expanded offerings, services and digital initiatives will drive Caterpillar's results.

Store Growth & Robust Comps Likely to Aid Starbucks (SBUX)
Per the Zacks analyst, Starbucks' rapid unit growth, digital offerings and robust comps growth bode well. In second-quarter fiscal 2022 global comparable store sales rose 7% year over year.

Better Pricing, New Business Growth Drive Chubb Limited (CB)
Per the Zacks analyst, Chubb is set to grow on better pricing, new business growth and high renewal rate. Yet, exposure to cat loss induces underwriting volatility while rising costs pressurize margin

Permian Basin Focus, Cost Management Aid Occidental (OXY)
Per the Zacks analyst Occidental's acquisition of Anadarko expanded its operation in resource rich Permian Basin and efficient cost management will drive its performance over the long run.

EOG Resources (EOG) Banks on Delaware & Bakken Shale Plays
Per the Zacks analyst, EOG Resources' strong footprint in oil-rich Delaware and Bakken shale plays has made the firm's production outlook bright. However, rising lease & well expenses are concerning.

Ericsson (ERIC) Rides on Holistic Growth to Extend Footprint
Per the Zacks analyst, Ericsson is well poised for a healthy growth momentum with a comprehensive 5G portfolio and strategic buyout of Vonage that expand its presence in wireless enterprise market.

New Upgrades

Service Corporation (SCI) Gains on Robust Funeral Segment
Per the Zacks analyst, Service Corporation is gaining on solid Funeral sales for a while. During first-quarter consolidated Funeral revenues increased 4.8% year over year to $649.1 million.

United Therapeutics' (UTHR) Four PAH Drugs to Drive Sales
Per the Zacks analyst, United Therapeutics' strong position in the PAH market with four approved products and its focus on expanding the indications for its drugs might drive long-term growth.

Avis Budget (CAR) Benefits From Acquisitions, Fleet Growth
The Zacks analyst is encouraged by Avis Budget's buyout strategy to expand global footprint and brand presence. Expansion of connected cars fleet has helped streamline operations and reduce costs.

New Downgrades

Lower Production & Higher Costs to Hurt National Steel (SID)
Per the Zacks analyst, lower mining output owing to heavy rainfall along with volatile iron ore prices and rising cost and expenses will weigh on National Steel's results.

Higher Freight Costs to Mar American Eagle's (AEO) Margins
Per the Zacks analyst, American Eagle is reeling under high inflation rates and freight expenses stemming from increased rent and delivery expenses. This led to slashed margin view for fiscal 2022.

Higher Operating Expenses Hurt Change Healthcare (CHNG)
Per the Zacks analyst, rise in total operating expenses, primarily due to higher selling, general and administrative costs, might hurt Change Healthcare's operating margin expansion.

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