Top Analyst Reports for Coca-Cola, Honeywell & Chubb

Thursday, November 30, 2017

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 Coca-Cola (KO), Honeywell (HON) and Chubb (CB). 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 >>>

Coca-Cola’s shares have underperformed the Zacks Soft Drinks Beverages industry since the beginning of the year, (+9.7% vs. +13%). However, Coca-Cola enjoys solid long-term fundamentals given its worldwide reach, strong brand power, higher international presence and impressive cash position.

Although the top line needs to show sustained improvement, the Zacks analyst likes the company’s strategic efforts toward creating the portfolio of a total beverage company with improved marketing and innovation, focus on driving revenues by improved price/mix, digital focus, and productivity initiatives toward driving margins. Moreover, Coca-Cola’s transformative global re-franchising initiatives will lead to better margins and returns as well as superior growth, despite hurting sales/profits in the near term.

Also, Coca-Cola’s new revenue platforms should drive growth over the long term. However, challenging global market conditions, weak CSD volumes and currency and structural headwinds remain challenges.

(You can read the full research report on Coca-Cola here >>>).

Shares of Honeywell have outperformed the Zacks Diversified Operations industry in the year to date period, increasing +32.3% vs. a -4.0% decline. With a flexible yet disciplined focus on cost and productivity, Honeywell’s diversified business portfolio has the potential to earn consistent above-average returns and mitigate operating risks through a balanced organic and inorganic model.

The Zacks analyst likes the company’s diligent focus on working capital management, free cash flow generation and conservative balance sheet. However, adverse foreign currency translations, high R&D expenses and volatility in commodity prices are likely to peg back its growth momentum to some extent.

Although the company’s proactive restructuring initiatives have positioned it to navigate better than many of its peers, it has yet to witness signs of stabilization in a number of its major end markets. A change in the U.S. government’s defense and aerospace funding could also adversely impact sales of the Aerospace business.

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

Chubb’s shares have gained +15.5% year to date, in line with the Zacks Property, Casualty and Title industry. The Zacks analyst thinks Chubb stands a good chance of taking leadership in the P&C space, benefiting from compelling products and services. Its inorganic growth story is impressive, helping it achieve higher long-term ROE.

Investment results are exhibiting improvement owing to improving rate environment. A strong capital position helps Chubb boost in shareholders’ value and invest in strategic initiatives to drive growth. Notably, it is on track to achieve annual run-rate integration-related savings of $875 million (up from $800 million guided earlier) by the end of 2018.

However, exposure to cat loss and escalating expenses raise concerns for Chubb. The company estimates fourth quarter cat loss from wildfire in California to be about $249 million and another $34 million from all other natural catastrophe. Though the Zacks Consensus Estimate for 2017 moved south, the consensus mark increased for 2018.

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

Other noteworthy reports we are featuring today include Statoil (STO), Travelers (TRV) and Workday (WDAY).

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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

Coca-Cola's (KO) Cost Savings Plan to Spur Growth, Sales Weak

Foreign Exchange Woes Mar Honeywell's (HON) Growth Prospects

Chubb (CB) Gains from Diversified Portfolio, Cat Loss Ails

Featured Reports

ONEOK (OKE) Gains from Expansion & Fee- Based Contracts

The Zacks analyst believes ONEOK continues to gain from expansion of its existing capacity in the prolific oil and gas regions.

Cost-Cut Efforts Aid Norfolk Southern (NSC) Amid Debt Woes

Though concerned about its high debt levels and the sluggish automotive unit, the Zacks analyst likes the company's prudent cost management and shareholder-friendly measures.

Statoil (STO) to Gain from Norwegian Upstream Projects

The Zacks analyst expects Statoil to generate significant cash flow from new upstream projects in the Norwegian Continental Shelf.

Portfolio Strength, Robust Clientele Benefits Workday (WDAY)

Per the Zacks analyst, Workday benefits from strong product portfolio that is helping it to win medium-sized customers on a regular basis.

Tech Data (TECD) Rides on Buyouts Amid Intense Competition

Per the Zacks analyst, Tech Data benefits from buyouts like Technology Solutions, which it acquired from Avnet. But, the company needs to watch out for stiff competition and sluggish PC market.

Travelers (TRV) Gains from Pricing Actions, Cat Loss Ails

Per the Zacks analyst, Travelers is set to gain from pricing and other actions, which drives higher returns and improve profitability, and strategic buyouts.

Radian's (RDN) Gains from Focus on Core Business

Per the Zacks analyst, Radian is poised for growth given its focus on core business and services with higher-growth potential besides more predictable and recurring fee-based revenues.

New Upgrades

Five Below (FIVE) Focus on Pre-Teen Customers to Fuel Sales

Five Below's comparable sales growth has improved over the quarters. Per the Zacks analyst, better price management, merchandise, cost containment and focus on pre-teen customers should drive sales.

Big Lots' (BIG) Soft Home, Furniture to Drive Sales Higher

Per the Zacks analyst, Big Lots' furniture and soft home categories will help drive sales in the coming quarters. For the third quarter, comparable sales are expected to be up in the low-single digits

Teradyne (TER) Riding High on LitePoint Acquisition

The Zacks analyst believes that the LitePoint acquisition has expanded Teradyne's presence in the fast-growing wireless testing market, with solutions for next generation wireless networking.

New Downgrades

Hurricane Harvey, High Input Costs Hurt Greif (GEF)

Per the Zacks analyst, Greif's results in FY17 will be hurt by unfavorable impact of Hurricane Harvey. Raw material cost inflation and delays in equipment delivery will also hit growth.

Ligand's (LGND) Dependence on Royalties Remains a Concern

The Zacks analyst believes that although Ligand's revenue has increased, its dependence on royalties for its revenues remains a concern as failure on its partners' end will severely impact prospects.

Rising Self-Storage Units Supply to Hurt Extra Space (EXR)

Per the Zacks analyst, there is development boom of self-storage units in many markets. This is likely to fuel competition for Extra Space, curb its power to raise rents and result in more discounting

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Workday, Inc. (WDAY) : Free Stock Analysis Report
 
The Travelers Companies, Inc. (TRV) : Free Stock Analysis Report
 
Statoil ASA (STO) : Free Stock Analysis Report
 
Coca-Cola Company (The) (KO) : Free Stock Analysis Report
 
Honeywell International Inc. (HON) : Free Stock Analysis Report
 
D/B/A Chubb Limited New (CB) : Free Stock Analysis Report
 
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