Friday, April 22, 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 The Home Depot, Inc. (HD), Verizon Communications Inc. (VZ), and Anthem, Inc. (ANTM). 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 >>>

Home Depot shares have declined -2.2% over the past year against the Zacks Building Products – Retail industry’s gain of +0.7% on creeping worries for the housing industry outlook in light of rising interest rates. The company reported soft gross margin in the fiscal fourth quarter driven by a higher cost of goods sold. Supply chain headwinds also marred results to some extent.

The Zacks analyst believes that the company may benefit due to strong demand for home-improvement projects, robust housing market trends, and ongoing investments, along with continued strength in both Pro and DIY categories as well as digital momentum. Its interconnected retail strategy and underlying technology infrastructure could help boost web traffic aiding digital sales.

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

Shares of Verizon have outperformed the Zacks Wireless National industry over the past year (+0.6% vs. -4.0%). The company plans to accelerate the availability of its 5G Ultra Wideband network, covering 175 million people by the end of 2022. The telecom giant’s growth strategy includes 5G mobility, nationwide broadband and mobile edge computing, and business solutions. Verizon has inked deals with satellite providers for early clearance of the additional C-band spectrum it acquired in 2021. The company is building the entire network infrastructure to provide the most amazing 5G experience to customers.

However, it operates in an intensely competitive market. Hefty expenses on promotions and lucrative discounts to attract customers could hurt its profitability. High auctioning expenses for the mid-band spectrum are expected to further compromise its margins.

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

Shares of Anthem have outperformed the Zacks Medical – HMOs industry over the past year (+36.8% vs. +32.2%). The company’s improving top line can be attributed to a premium rate increase and higher memberships. The Zacks analyst believes that acquisitions and collaborations have enabled the company to boost its Medicare Advantage growth and strengthen its business portfolio. Its well-performing Medicare and Medicaid businesses coupled with several contract wins are expected to drive its membership. A solid earnings guidance for 2022 bodes well.

Anthem announced its plan to change its name to Elevance Health to boost its market position. However, escalating costs continue to put pressure on the bottom line. Its weak balance sheet with massive debts of nearly $20 billion can affect financial flexibility.

(You can read the full research report on Anthem here >>>)Other noteworthy reports we are featuring today include Salesforce, Inc. (CRM), BHP Group Limited (BHP), and BP p.l.c. (BP).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

Focus on Pro Customers to Aid Home Depot's (HD) Top Line

5G Forte, Customer Growth to Drive Verizon (VZ) Amid Rivalry

Anthem (ANTM) Bets on Solid Top Line & Capital Position

Featured Reports

Salesforce (CRM) Rides on Partnership Wins & AcquisitionsPer the Zacks analyst, Salesforce's expanding partner ecosystem is contributing to business wins and boosting its presence globally. Also, strategic buyouts like Slack and Tableau are positive.

High Metal Prices, Operation Efficiency Aid BHP Group (BHP)The Zacks analyst believes rising iron ore, copper and nickel prices along with BHP's strong cash flow, focus on lowering debt and efforts to make operations more efficient will drive growth.

BP plc (BP) Banks on Aggressive Energy-Transition Strategy The Zacks analyst likes BP since the British integrated energy major is planning to become a net-zero emissions player by 2050. How, exposure to excessive debt capital is concerning.

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. The company anticipates global comparable sales to reach high-single digits in fiscal 2022.

Dividends, Buybacks Aid Canadian National (CNI), Costs AilThe Zacks analyst is impressed by the company's efforts to reward its shareholders through dividends and share buybacks. However, escalating fuel costs and supply chain disruptions are concerns.

CME Group (CME) Banks on Improving Top Line, Expenses Hurt Per the Zacks analyst, its strong revenues driven by organic growth, steady market position and diverse product lines has led to significant growth. However, escalating expenses hurt its margins.

Organic Growth Supports U.S. Bancorp (USB), Higher Costs AilPer the Zacks analyst, U.S. Bancorp's organic growth, driven by higher revenues and loan balance, is likely to boost its financials. Concentrated loan portfolio and high costs are headwinds.

New Upgrades

America Movil (AMX) Benefits from Increasing Subscriber BasePer the Zacks analyst, America Movil's performance is gaining from growing subscriber base. The company's acquisitions, focused 5G efforts and deployment of advanced technologies are other tailwinds.

Pioneer Natural (PXD) Banks On Oil-Rich Permian Basin AssetsThe Zacks analyst believes that Pioneer Natural's one million-plus high-quality acreages in the Permian Basin will drive long-term oil production growth.

Watsco (WSO) Rides on Technology Platforms & AcquisitionsPer the Zacks analyst, Watsco's investments in customer-focused technologies and the expansion of the company's branch network through acquisitions are boosting performance.

New Downgrades

International Exposure & Old Facilities Ail NRG Energy (NRG)Per the Zacks analyst, NRG Energy's international operations expose it to political and economic risks and some of its old facilities create a competitive disadvantage against peers.

Huge Debt Pile & High Operating Costs to Ail Carvana (CVNA)Escalating selling, general & administrative expenses and an elevated leverage of more than 90% have made the Zacks analyst turn bearish on Carvana.

Emergent's (EBS) Overdependence on BioThrax Is A ConcernPer the Zacks analyst, Emergent derives majority of its revenues from sales of its anthrax and smallpox vaccines to the U.S. government. Any loss of existing contracts will hurt its prospects.

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 BP p.l.c. (BP) : Free Stock Analysis Report Salesforce Inc. (CRM) : Free Stock Analysis Report Verizon Communications Inc. (VZ) : Free Stock Analysis Report BHP Group Limited Sponsored ADR (BHP) : Free Stock Analysis Report The Home Depot, Inc. (HD) : Free Stock Analysis Report Anthem, Inc. (ANTM) : Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research