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Wednesday, September 13, 2023
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 Costco Wholesale Corporation (COST), Equinor ASA (EQNR) and Lam Research Corporation (LRCX). 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 Costco Wholesale have outperformed the Zacks Retail – Discount Stores industry over the year-to-date period (+23.1% vs. +3.5%). The company being a consumer defensive stock, has been surviving the market turmoil pretty well.
The discount retailer’s key strengths are strategic investments, a customer-centric approach, merchandise initiatives, and an emphasis on membership growth. These factors have been helping it register decent sales and earnings numbers. This outlook reflects Costco’s ability to navigate the challenging operating environment, generate solid sales, and register high membership renewal rates.
A favorable product mix, steady store traffic, pricing power and strong liquidity position should help Costco keep outperforming. While trading at a premium to its peers, its long-term growth prospects should help the stock see a solid upside.
(You can read the full research report on Costco Wholesale here >>>)
Equinor shares have outperformed the Zacks Oil and Gas – Refining and Marketing industry over the past six months (+20% vs. +16%). The company is one of the premier integrated energy companies, with operations across 30 countries.
During the second quarter, this integrated energy giant successfully concluded seven exploration wells in offshore operations, resulting in the identification of three commercially viable discoveries. The firm expects a significant expansion of its renewable production capabilities. Equinor expanded its ongoing share buyback initiative, creating a buyback program of up to $6 billion for 2023.
However, Equinor’s balance sheet has a notable level of debt exposure compared with industry peers, affecting its financial flexibility. The company faced the burden of rising costs in recent quarters, which has had a detrimental impact on its income. Also, its ambitious capital budget represents a challenge. As such, the stock warrants a cautious stance.
(You can read the full research report on Equinor here >>>)
Shares of Lam Research have outperformed the Zacks Semiconductor Equipment – Wafer industry over the year-to-date period (+56.7% vs. +29%). The company’s proper execution, expansion and diversified global footprints are positives. Lam Research remains optimistic about its technological advancements, especially with AI.
Also, its strength in 3D DRAM and advanced packaging is a tailwind. Further, rising NAND requirement in accelerating 5G migration, video, and new game consoles is another positive. Solid traction among etch and deposition technologies are likely to aid the company in the near term.
Further, advanced packaging technology inflections are other positives. Additionally, strength in both ALD metals and dielectrics deposition solutions is a tailwind. However, weak outlook for 2023 wafer fabrication equipment spending remains a major concern. Also, sluggish memory spending remains a headwind.
(You can read the full research report on Lam Research here >>>)
Other noteworthy reports we are featuring today include Schlumberger Limited (SLB), Synopsys, Inc. (SNPS) and PPG Industries, Inc. (PPG).
Director of Research
Sheraz Mian
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>>>
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Today’s Must Read
Decent Comparable Sales Run to Fuel Costco’s (COST) Top Line
Equinor (EQNR) to Benefit From Rising Clean Energy Demand
Lam Research (LRCX) Benefits From Strengthening NAND Demand
Featured Reports
Increased Oilfield Service Demand Across the Globe Aids SLB
SLB anticipates another year of margin growth from increased service pricing since overall operations see broad-based expansion. Yet, its significant debt exposure concerns the Zacks analyst.
PPG Industries (PPG) Gains on Cost Reduction & Acquisitions
Per the Zacks analyst, PPG will benefit from cost savings through restructuring actions and synergies of acquisitions amid headwinds from weaker demand in Europe and China.
Sun Life Financial (SLF) Set to Grow on Solid Asia Business
Per the Zacks analyst, Sun Life is set for grow on the strength of its Asia business that are expected to provide higher return and growth as well as expanding global asset management business.
SHOP Recovery, Accretive Investments to Drive Ventas (VTR)
Per the Zacks Analyst, improving senior housing operating portfolio (SHOP) fundamentals and accretive investments in the research portfolio to aid Ventas. However, rising interest rates are a key woe.
Cost Savings to Aid International Paper (IP) as Volumes Ail
Per the Zacks analyst, savings from its Building a Better IP initiatives and favorable fiber and chemical costs will drive International Paper’s earnings despite the current weak demand.
Syneos Health’s (SYNH) Selloff Decision Seems Strategic
The Zacks analyst is positive about Syneos Health to be acquired by a group of private equity firms. This is expected to enable the consolidated company to accelerate its growth strategy.
Solid Demand Aids Embraer S.A. (ERJ) Amid Supply Chain Woes
Per the Zacks analyst, the strong demand for E-jets aircraft should benefit. Yet, COVID-19 induced supply chain and logistics challenges may continue to impact its Defense and Security business unit.
New Upgrades
Synopsys (SNPS) Banks on Strong Product Menu, Contract Wins
Per the Zacks analyst, Synopsys’ focus on strengthening its product portfolio is helping it cater to the growing demand in the EDA market. Deal wins at leading semiconductor companies is a tailwind.
Solid Demand & Build-To-Order Model Aid Toll Brothers (TOL)
Per the Zacks analyst, Toll Brothers’ growth trend is attributable to improved market demand, favorable pricing along with its focus on operational efficiency and Build-To-Order approach.
Woodward (WWD) Benefits from Momentum in Aerospace Segment
Per the Zacks analyst, Woodward’s performance is gaining from strength in its Aerospace segment. The Industrial segment is expected to gain from higher demand for power generation.
New Downgrades
Escalating Investment in Headcount Hurt FTI Consulting (FCN)
Per the Zacks analyst, escalating investments in hiring highly qualified professionals as well as promoting and training individuals, increases costs and weighs on FTI Consulting’ bottom-line growth.
Southwest Airlines (LUV) Continues to Grapple With Fuel Costs
The Zacks Analyst is worried about the escalating fuel prices as they are likely to keep the bottom line under pressure.
Cogent (CCOI) Plagued by High Debt Burden, Macroeconomic Woes
Per the Zacks analyst, volatility in the real estate market owing to macroeconomic uncertainty combined with high debt burden and rising operating costs will likely strain Cogent’s margins.
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
Schlumberger Limited (SLB) : Free Stock Analysis Report
PPG Industries, Inc. (PPG) : Free Stock Analysis Report
Lam Research Corporation (LRCX) : Free Stock Analysis Report
Costco Wholesale Corporation (COST) : Free Stock Analysis Report
Synopsys, Inc. (SNPS) : Free Stock Analysis Report
Equinor ASA (EQNR) : Free Stock Analysis Report
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This article was originally published by a finance.yahoo.com . Read the Original article here.
