Top Research Reports for AT&T, Home Depot & Cisco

Tuesday, July 17, 2018

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 AT&T (T), Home Depot (HD) and Cisco (CSCO). 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-ranked AT&T’s shares have decreased -9.4% in the last three months, underperforming the Zacks Wireless National industry's fall of -1.8%. AT&T is gearing up to launch the first standards-based mobile 5G services in multiple U.S. markets by the end of 2018.

The Zacks analyst thinks the company will benefit from its probable merger with Time Warner. The deal is likely to reshape the industry dynamics, creating a new media behemoth. It will enable the power packed combination of AT&T’s data and Time Warner’s content to create new kinds of online videos and sell targeted advertisements.

AT&T intends to acquire AlienVault to enhance its line of cybersecurity products designed for small and medium-sized businesses. It also inked an agreement to acquire AppNexus to augment its foothold in the digital ad sales market. AT&T’s wireline division is facing losses in access lines due to competitive pressure from voice-over-Internet protocol service providers.

(You can read the full research report on AT&T here >>>).

Shares of Buy-ranked Home Depot have gained +30.7% over the last year, outperforming the Zacks Retail Building Products industry’s +27.8% increase. The Zacks analyst thinks that this performance is attributed to its five-year long trend of beating earnings estimates, which continued in first-quarter fiscal 2018.

Further, both the top and bottom line improved year over year in the first quarter. The company is gaining 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 remain tailwinds.

Going into the fiscal second quarter, the company witnessed strength in all lines of business in the first few weeks of May. Consequently, it provided an optimistic view for fiscal 2018. However, top line lagged estimates mainly due to colder-than-normal weather that led to softness in the spring season categories, particularly garden. This softness also resulted in a decline in comparable transactions.

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

Buy-ranked Cisco's shares have outperformed the Zacks Networking industry in the past year, gaining +34.9% vs. +32.6%. Strong contribution from acquisitions, security, Infrastructure Platforms and applications drove are positives.

The Zacks analyst thinks Cisco’s expanding footprint in the rapidly growing security market presents significant growth opportunity. Strengthening collaboration portfolio which now includes Webex Teams and AI-based Accompany bodes well. Partnerships with Telenor, Apple, IBM, Microsoft and Google Cloud are positive. Divestiture of a portion of Cisco’s NDS video assets is likely to mitigate the sluggishness witnessed in other product segment.

However, weakness in switching and routing is a headwind. Ongoing transition to subscription-based model will continue to hurt the top line. Further, dampening service provider business and intense competition from peers are other concerns.

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

Other noteworthy reports we are featuring today include Boston Scientific (BSX), Ford (F) and Mondelez (MDLZ).

Today's Stocks from Zacks' Hottest Strategies

It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.

And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.

See Them Free>>

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

AT&T (T) Rides on 5G Service Launch and Strategic Takeovers

Home Depot's (HD) Focus on Pro Customers to Bolster Growth

Cisco (CSCO) Rides on Security Products & Strategic Deals

Featured Reports

J.B. Hunt (JBHT) Aided by Higher Shipping Volumes, Costs Ail

The Zacks analyst likes the robust shipping demand, which is aiding the company. Higher freight rates are also favorable. However, high driver wages are pushing up operating expenses.

Apache's (APA) Alpine High Discovery to Boost Returns

Per the Zacks analyst, Apache's sharp focus on Alpine High Play along with its ambitious plans to enrich the region's midstream prowess is expected to generate top-tier returns for the company.

Loan Growth, Higher Rates Support KeyCorp (KEY) Revenues

Per the Zacks analyst, KeyCorp is well poised for revenue growth driven by continued loan growth and higher interest rates.

New Testing Hub in China, Partnerships to Aid Toyota (TM)

Per the Zacks analyst, plans to open a battery testing hub in China and tie-ups with other companies to develop electric vehicle technologies will help Toyota gain from the rising demand for EVs.

Focus on Cloud-Based Software Boosts Veeva Systems (VEEV)

Per the Zacks analyst, cloud-based applications like Veeva Vault, Veeva CRM, Veeva Network and Veeva OpenData has provided Veeva Systems with a competitive edge in the MedTech industry.

Boyd Gaming (BYD) Banks on Expansion, High Debt a Concern

Per the Zacks analysts, focus on strengthening current operations will drive growth.

Strong Oncology Portfolio Boost Novartis (NVS), Sandoz Lags

Per the Zacks analyst, Novartis' strong oncology portfolio should maintain momentum as it combats generic competition for key drugs.

New Upgrades

Green Assets and North America Focus Aids NRG Yield (NYLD)

The Zacks analyst believes NRG Yield's long-lived renewable assets and North America focus lowers currency risks and offers growth opportunity via acquisition of natural gas and thermal assets.

AXIS Capital (AXS) Continues to Gain from Higher Premiums

Per the Zacks analyst, improving premiums, driven by premium growth across segments, continue to boost AXIS Capital's top line, thereby resulting in the company's overall growth.

Higher Loans & Fee Income Support Commerce Bancshares (CBSH)

Per the Zacks analyst, loan growth, higher interest rates and fee income growth should aid Commerce Bancshares' revenues. Easing of stringent banking regulations and tax cuts will provide support.

New Downgrades

Lotus Recall, Dull Pacer Sales Hurt Boston Scientific (BSX)

The Zacks analyst is concerned about declining worldwide pacemaker sales hurting Boston Scientific's CRM business. Also, the fate of Lotus valve recall issue seems to be in limbo for some more time.

Ford (F) Shifts to Low Gear on Recall Issues & Tariff Threat

Per the Zacks analyst, Ford's plan to absorb additional tariffs on U.S.-manufactured automobiles to China is likely to hurt its margins. Also, recall related issues are adding to its expenses.

Escalating Freight & Commodity Costs Worry Mondelez (MDLZ)

Per the Zacks analyst, Mondelez's gross margin in the first quarter was dented by higher commodity and freight costs. Such expenses remain a pressure for the company, being a threat to gross margin.

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
 
AT&T Inc. (T) : Free Stock Analysis Report
 
Mondelez International, Inc. (MDLZ) : Free Stock Analysis Report
 
The Home Depot, Inc. (HD) : Free Stock Analysis Report
 
Ford Motor Company (F) : Free Stock Analysis Report
 
Cisco Systems, Inc. (CSCO) : Free Stock Analysis Report
 
Boston Scientific Corporation (BSX) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research