Top Analyst Reports for Home Depot, Boeing & Merck

Tuesday, December 5, 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 Home Depot (HD), Boeing (BA) and Merck (MRK). 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 >>>

Buy-rated Home Depot’s shares have gained +37.9% year to date, compared with the +31.5% gain of the Zacks Retail Building Products industry, backed by its five-year long trend of beating earnings estimates. The company delivered bottom-line beat in third-quarter fiscal 2017, while sales topped estimates for the fifth straight quarter.

Results gained from strength in core business as well as relentless focus on affording innovative products, boosting interconnected customer experience and driving productivity. Steady housing market recovery and strong customer demand also remained tailwinds.

While hurricane-related activities aided comps growth, gross margins on such sales were significantly below average. This led to a decline in gross margin, which is likely to continue in fiscal 2017. Moreover, competition from online retailers may impact performance.

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

Shares of Boeing have surged +78.6% over the past year, outperforming the Zacks Aerospace & Defense sector, which gained +39.2% during the same time period. Notably, Boeing is the largest aircraft manufacturer in the world in terms of revenue, orders and deliveries, and one of the largest aerospace and defense contractors.

In this regard, the company’s 20-year market outlook forecasts commercial jetliner demand to increase by 3.6%. Yet, this aerospace company continues to face challenges from order cancellations, stiff competition as well as falling delivery numbers. Furthermore, Boeing’s 787 Dreamliner's deferred production cost remains a cause of concern.

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

Merck’s shares have underperformed the Zacks Large Cap Pharmaceuticals industry over the last year, losing -6.8% versus +18.5%, as the company has suffered some notable pipeline setbacks this year. Merck enjoys a diversified business across branded drugs, vaccines and animal health.

Merck has made significant progress with its pipeline and is working on bringing new products to the market. New products like Keytruda and Zepatier should continue to contribute meaningfully to the top line. Keytruda is gaining strong momentum from new indication of first-line lung cancer. The Keytruda development program also significantly advanced this year with several key regulatory approvals.

Meanwhile, Merck will continue to focus on cost-cutting initiatives to drive the bottom line. However, generic competition for several drugs and pricing pressure will continue to be overhangs on the top line. Rising competition in the immuno-oncology market is also a significant concern.

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

Other noteworthy reports we are featuring today include Sinopec (SNP), Allstate (ALL) and Illumina (ILMN).

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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

Home Depot's (HD) Interconnected Strategy to Boost Sales

Commercial Jet Demand Aids Boeing (BA), Deferred Costs Ail

Merck's (MRK) New Drugs Drive Sales amid Generic Pressure

Featured Reports

Sinopec's (SNP) New Finds, Declining Debt Load Raise Optimism

The Zacks analyst values Sinopec's discoveries - the Shengli field and Junggar Basin, which will support long-term production

Amphenol (APH) Remains Well Poised on Holistic Growth Model

Per the Zacks analyst, a balanced organic and inorganic growth model, a lean and flexible cost structure, and an agile and entrepreneurial management team remain key growth drivers for Amphenol.

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

Per the Zacks analyst, Big Lots' furniture and soft home categories will continue to drive sales in coming quarters.

Premium Growth Buoys Allstate (ALL), Catastrophe Loss Hurts

Per the Zacks analyst initiatives such as pricing discipline and strong claims management have led to premium growth at both its segments, but high weather related losses hurt margins.

Life Science Assets to Drive Growth for Alexandria (ARE)

Per the Zacks Analyst, strong fundamentals in the life-science industry has driven demand for Alexandria's properties.

Sluggish Enrollment Weighs on Universal Technical (UTI)

Per the Zacks analyst, Universal Technical's enrollments have been sluggish for several quarters now, which is marring growth prospects.

Roper (ROP) Drives On Acquisitions, Optimum Mix of Products

Per the Zacks analyst, an optimum mix of highly engineered and niche-oriented products is helping Roper to gain market share.

New Upgrades

Debt Cuts, Production Growth Actions to Aid Newmont (NEM)

The Zacks analyst thinks Newmont should gain from its efforts to boost production performance, de-lever its balance sheet and improve operational efficiency.

Growing Product Uptake, Strategic Pacts Aid Illumina (ILMN)

The Zacks analyst expects Illumina to maintain its growth momentum on continued uptake of sequencing consumables, instruments and microarray portfolios. Recent strategic pacts should add value.

Red Hat (RHT) Banks on Strong Deal Wins, Recurring Revenues

According to the Zacks analyst, Red Hat is benefiting from strong deal wins, improving recurring revenues and cross-selling of cloud-based technology. Expanding partner base is also positive.

New Downgrades

Semtech (SMTC) Grapples with Competition, Pricing Pressure

Per the Zacks analyst, mounting competition in the semiconductor space and resultant pricing pressure will continue to weigh on Semtech's margins and profitability.

Consumer &Technology-Driven Market Weighs on Altice (ATUS)

The Zacks analyst is pessimistic about Altice USA's operations in a consumer and technology-driven market, which is highly dependent on rapidly changing businesses and consumer choices.

Jack in the Box (JACK) Affected By Declining Comps at Qdoba

Per the Zacks analyst, persistent lower comps at Jack in the Box's Qdoba brand is significantly hurting the company's overall sales amid an already challenging restaurant environment.

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China Petroleum & Chemical Corporation (SNP) : Free Stock Analysis Report
 
Merck & Company, Inc. (MRK) : Free Stock Analysis Report
 
Illumina, Inc. (ILMN) : Free Stock Analysis Report
 
Home Depot, Inc. (The) (HD) : Free Stock Analysis Report
 
Boeing Company (The) (BA) : Free Stock Analysis Report
 
Allstate Corporation (The) (ALL) : Free Stock Analysis Report
 
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