Top Research Reports for UnitedHealth, Walmart & AT&T

Tuesday, June 19, 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 UnitedHealth (UNH), Walmart (WMT) and AT&T (T). 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 >>>

UnitedHealth's shares have outperformed the Zacks Medical Insurance industry year to date (up +15.6% vs. +13.3%). The Zacks analyst thinks the company's robust Government business and continued strong performance at Optum are driving long-term growth. Its international business and strong capital position driving business investment are the other positives.

The company has been witnessing an increase in membership over the past many years. It again lifted its 2018 earnings guidance, buoying optimism among investors in the stock. The company has witnessed its 2018 estimate increase by 1.2% to $12.62 over the past 90 days.

However, membership loss in its fee-based commercial as well as Brazilian businesses will contract the overall membership growth for UnitedHealth Group. Additionally, higher medical care ratio raises concern.

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

Shares of Walmart have lost -16% in the last six months, underperforming the Zacks Supermarkets industry's -14.5% decline in the same time period. The Zacks analyst thinks Walmart is poised to gain from its strong e-commerce initiatives, particularly expansion of online grocery delivery. This, along with efforts to drive brick-and-mortar sales should help the company maintain its sturdy U.S. comps trend.

Walmart is also undertaking efforts to improve the performance of its International unit, by shifting focus from underperforming regions to profitable countries like India and China. To this end, the company’s recent investment in Flipkart is however expected to dent the bottom line in the near term.

Further, investments related to the e-commerce initiatives and a compelling pricing strategy have been hurting Walmart’s gross margin. Nonetheless, the Flipkart deal bodes well for the long term, which along with focus on buyouts, alliances and improved delivery services should help Walmart stand firm against Amazon.

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

AT&T’s shares have decreased -11.4% in the last three months, underperforming the Zacks Wireless National industry's fall of -4.3%. AT&T is gearing up to launch the first standards-based mobile 5G services to consumers in multiple U.S. markets by the end of 2018.

The Zacks analyst thinks the company is likely to benefit from its long-pending merger with Time Warner. Given the scale of both AT&T and Times Warner, the merger is likely to reshape the industry dynamics, creating a media behemoth. The deal will allow the power packed combination of AT&T’s data and Time Warner's content.

However, AT&T’s profitability has been hurt with spectrum crunch in a saturated wireless market. In addition, the company’s wireline division is struggling with persistent losses in access lines due to competitive pressure from voice-over-Internet protocol service providers and aggressive triple-play offerings by cable firms. These are weighing on AT&T’s revenues and margins.

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

Other noteworthy reports we are featuring today include NIKE (NKE), Thermo Fisher (TMO) and Anthem (ANTM).

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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

Strong Optum, Solid Balance Sheet Aids UnitedHealth (UNH)

E-commerce Sales to Fuel Walmart (WMT), Soft Margins a Woe

Time Warner Deal & 5G Launch Aid AT&T (T), Access Line Ails

Featured Reports

Patheon Buyout Aids Thermo Fisher (TMO) Amid Rising Costs

The Zacks analyst is bullish on Thermo Fisher boosting top-line and new capabilities through buyouts like Patheon and FEI. Rising operating costs for product development and marketing is a concern.

Increasing Membership Aids Anthem's (ANTM) Revenues

Per the Zacks analyst, a number of acquisitions, Medicaid expansion in the government segment have helped the company enhance its membership base.

Project Pipeline Aids Canadian Solar (CSIQ), Competition Hurts

Per the Zacks analyst, Canadian Solar's robust project pipeline across the globe helps the company to expand its footprint worldwide.

High IBG LLC Dependence to Hurt Interactive Brokers (IBKR)

Per the Zacks analyst, Interactive Brokers' dependence on IBG LLC will hurt financials if it fails to provide funds for taxes.

Allergan's (AGN) Key Drugs & Cost Cuts to Outweigh Generic Woes

Allergan faces generic competition for key drugs Namenda XR and Restasis in 2018. The Zacks analyst says that drugs like Botox/Linzess, new drugs and cost cuts can shield it from potential sales drop.

Investments Put DICK'S (DKS) on Growth Track, Sales Hurt

Per the Zacks analyst, DICK'S Sporting's investments in e-commerce, technology, Team Sports and private brands should boost market share.

High Inventory & Weak Pricing to Strain General Motors (GM)

Per the Zacks analyst, a high inventory level of passenger cars is pushing General Motors to cut production.

New Upgrades

Prudent Cost Control & Diversification Supports Goldman (GS)

Per the Zacks analyst, Goldman's efforts towards expense management are expected to aid bottom-line expansion in the coming quarters. Further, business diversification is a favorable factor.

Acquisitions, Strong Balance Sheet Aids Total System (TSS)

Per the Zacks analyst, the acquisitions of NetSpend, TransFirst, Cayan, iMobile has driven inorganic growth. Its strong free cash flow provides immense investment opportunity.

International & Online Business Aid NIKE's (NKE) Performance

Per the Zacks analyst, NIKE is gaining from strength in international and NIKE Direct businesses, both posting double-digit sales growth. This also drove 23 straight quarters of earnings beats.

New Downgrades

Omnicom (OMC) Grapples with Client Concentration Risk

The Zacks analyst is worried about Omnicom's dependence on a few big clients. Further, the company's reliance on information technology systems makes it vulnerable to cybersecurity risks.

Sluggish Enrollment Trend Weighs on Adtalem Global (ATGE)

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

DDR's (DDR) Profitability to Bear the Brunt of Divestitures

Per the Zacks analyst, DDR Corp.'s aggressive asset disposition is likely to affect its earnings. Competition from e-commerce remains a concern for the company.

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Walmart Inc. (WMT) : Free Stock Analysis Report
 
UnitedHealth Group Incorporated (UNH) : Free Stock Analysis Report
 
Thermo Fisher Scientific Inc. (TMO) : Free Stock Analysis Report
 
AT&T Inc. (T) : Free Stock Analysis Report
 
NIKE, Inc. (NKE) : Free Stock Analysis Report
 
Anthem, Inc. (ANTM) : Free Stock Analysis Report
 
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