Top Stock Reports for Cisco, Kraft Heinz & Sinopec

Tuesday, May 22, 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 Cisco (CSCO), Kraft Heinz (KHC) and Sinopec (SNP). 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 >>>

Cisco's shares have outperformed the Zacks Networking industry year to date, gaining +14.3% vs. +13.2%. Cisco delivered stellar third quarter results. Strong contribution from acquisitions, security, Infrastructure Platforms and applications drove year-over-year growth.

The Zacks analyst thinks Cisco’s expanding footprint in the rapidly growing security market presents a 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 positives. 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 the likes of Huawei, Juniper and Arista Networks are other concerns.

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

Shares of Kraft Heinz have declined -27.4% year to date, underperforming the Zacks Diversified Food industry which is down -13.8% over the same period. Kraft Heinz posted first-quarter 2018 results, wherein earnings beat expectations while revenues missed the same. Higher input costs, lower sales in the United States along with higher investments to boost capabilities seemed to have adversely affected this food company’s quarterly performance.

However, lower taxes and higher pricing have benefited the results. Adjusted earnings increased 6% but revenues declined 0.3% (down 1.5% organically). The top line was adversely impacted due to soft consumer demand in North America and Rest of World. Sales in the United States, Kraft Heinz's largest segment, declined 3.3% from a year ago.

Kraft Heinz has been struggling due to the shift in consumer preference toward natural and organic ingredients over packaged and processed food. Kraft Heinz’s estimates are trending downward for 2018 and 2019 over the past 60 days

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

Sinopec's shares have gained +27.9% over the past year, underperforming the Zacks Integrated Oil industry which has gained +58% over the same period. Sinopec posted impressive first-quarter 2018 results driven by higher oil price realizations. Earnings and revenues improved significantly on a year-over-year basis.

The Zacks analyst appreciates Sinopec’s large-scale natural gas discoveries, especially in the Hangjinqi of Nei Mongol, Dongpo of west Sichuan and Weirong block in southwestern Sichuan province, which will support long-term production. Sinopec is strongly committed toward returning cash to shareholders.

The company paid RMB 60.5 billion as cash dividend through 2017, the highest since its IPO. However, Sinopec’s escalating operating expenses are a concern. Also, lower refining yield through first-quarter 2018 is hurting the company’s downstream business.

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

Other noteworthy reports we are featuring today include PetroChina (PTR), Glaxo (GSK) and Progressive (PGR).

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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

Robust Security & Collaboration Portfolio Aid Cisco (CSCO)

Higher Input Costs & Lower US Sales Hurt Kraft Heinz (KHC)

Sinopec (SNP) Banks on Weirong Gas Field, Refining Yield Low

Featured Reports

Higher Premiums Continue to Aid Progressive (PGR)

Per the Zacks analyst, competitive market rates and a compelling multi-product portfolio will continue to fuel premium growth for Progressive, thereby resulting in the company's overall growth.

Focus on U.S. Operations Aids Hartford Financial (HIG)

Per the Zacks analyst, Hartford Financial is poised for growth as it concentrates on its U.S. operations and enhances its operating leverage.

Mohawk's (MHK) Inorganic Drive Strong, Rising Costs Hurt

Per the Zacks analyst, Mohawk's endeavor to pursue numerous acquisitions to broaden its geographic presence and product portfolio are encouraging amid rising raw material costs.

Dividends & Buybacks Aid C.H. Robinson (CHRW) Amid Cost Woes

The Zacks analyst likes the company's efforts to reward shareholders. Increased freight demand and lower tax rates are encouraging too.

Glaxo's (GSK) New Drugs Start Well, Advair to Face Generics

Glaxo's new products, Trelegy Ellipta, Shingrix & Juluca, are off to a solid start in 2018, per the Zacks analyst.

Loan Growth, Rates Support Zions (ZION), Higher Cost A Woe

Per the Zacks analyst, growth in loans and deposits, and higher interest rates aid Zions.

Margin Growth & Buyouts to Aid Parker-Hannifin (PH)

Per the Zacks analyst, Parker-Hannifin's revamped "Win Strategy" will continue to boost margins, going ahead.

New Upgrades

SCANA (SCG) Gains on Favorable Utility Rate, Merger Plan

The covering analyst agrees that SCANA's growth is supported by favorable electric utility rate. SCANA-Dominion merger will help in resolving issues of the abandoned V.C. Summer nuclear project.

Europe & Asia Regions to Continue Driving Guess? (GES) Sales

Per the Zacks analyst, solid Europe and Asia sales have been driving Guess? for a while now. Guess? plans to invest more in these regions that are likely to post double-digit sales growth this year.

Strong Pipeline & Collaborations Boost Immune Design (IMDZ)

Per the Zacks anlayst, Immune Design's has a strong immuno-oncology pipeline and the company's collaboration with Sanofi should prove to be quite beneficial for it.

New Downgrades

Take Two (TTWO) Hurt by Continuous Delay in Game Releases

Per the Zacks analyst, continuous delay in launching much awaited titles like Borderlands 3 and Red Dead Redemption 2 is hurting Take Two.

Invio (INO) Highly Dependant on Partners for Funding

Per the Zacks anlayst, Inovio relies highly on collaborators for funding. Also, most of Inovio's candidates are quite a few years away from entering the market.

PetroChina (PTR) Hurt by Declining Oil Production

The Zacks analyst is concerned about prospects for PetroChina's oil production growth, considering its heavy exposure to significantly mature Daqing region.

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China Petroleum & Chemical Corporation (SNP) : Free Stock Analysis Report
 
PetroChina Company Limited (PTR) : Free Stock Analysis Report
 
The Progressive Corporation (PGR) : Free Stock Analysis Report
 
The Kraft Heinz Company (KHC) : Free Stock Analysis Report
 
GlaxoSmithKline plc (GSK) : Free Stock Analysis Report
 
Cisco Systems, Inc. (CSCO) : Free Stock Analysis Report
 
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