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Top Stock Reports for Home Depot, Linde & Walt Disney

Thursday, May 25, 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 The Home Depot, Inc. (HD), Linde plc (LIN) and The Walt Disney Company (DIS). 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 Home Depot have underperformed the Zacks Building Products - Retail industry over the past year (-1.4% vs. +4.2%). The company has witnessed dismal performance in first-quarter fiscal 2023. Results were impacted by a more broad-based pressure across the business, driven by softened demand versus expectations. A deflation in lumber prices and unfavorable weather have also hurt the results. HD also provided a conservative view for fiscal 2023.

Nevertheless, Home Depot has been witnessing significant benefits from the execution of the “One Home Depot” investment plan, which focuses on expanding supply chain facilities, technology investments and enhancement to the digital experience.

The interconnected retail strategy and underlying technology infrastructure have helped consistently boost web traffic for the past few quarters. The company remains on track with its strategic investments to build a Pro ecosystem.

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

Linde shares have outperformed the Zacks Chemical - Specialty industry over the past year (+12.5% vs. -3.2%). With a wide range of applications for its industrial gases, Linde is making the world more productive by the day. The company’s primary products in industrial gases include oxygen, which is used as life support in hospitals.

Linde has long-term contracts with on-site customers backed by minimum purchase requirements, thereby securing stable cashflows. In the profitable industrial gas market, the merger of Praxair and Linde has created an efficient player with considerable size advantages.

However, the cost of sales continues to increase, hurting the firm’s bottom line. Also, high leverage may limit its financial flexibility. The firm has mostly been paying a lower dividend yield than the industry’s composite stocks over the past two years.

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

Shares of Walt Disney have outperformed the Zacks Media Conglomerates industry over the year-to-date period (+2.5% vs. +2.0%). The company is benefiting from growing popularity of Disney+, owing to a strong content portfolio and a cheaper bundle offering.

Strong line-up of movies that include The Little Mermaid; Indiana Jones and the Dial of Destiny; The Boogeyman, Elemental and Haunted Mansion bodes well for the Media and Entertainment Distribution segment. Revival in Parks, Experiences and Products businesses is encouraging.

Theme Park business is likely to gain from strong demand across both the domestic and international parks. However, Disney+’s profitability continues to be negatively impacted by higher programming and production costs across Disney+, ESPN+ and Hulu. Disney’s leveraged balance sheet remains a concern.

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

Other noteworthy reports we are featuring today include Palo Alto Networks, Inc. (PANW), Edwards Lifesciences Corp. (EW) and U.S. Bancorp (USB).

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

Home Depot's (HD) Interconnected Strategy to Boost Sales

Linde's (LIN) Contracts With Minimum Volume Requirements Aid

Disney+ Growth & Revival of Parks Business Aids Disney (DIS)

Featured Reports

Palo Alto (PANW) Rides on Product Strength, Marketing Effort
Per the Zacks analyst, Palo Alto Networks is gaining from solid contributions of its growth-oriented products including Strata, Prisma and Cortex. Increasing marketing efforts are also positive.

Edwards (EW) Rides on TMTT Arm Growth Amid Forex Woes
The Zacks analyst is impressed with Edwards's TMTT arm growth in the first-quarter driven by the continued adoption of the PASCAL Precision system in Europe. Foreign exchange woes remain a concern.

Acquisitions Support U.S. Bancorp (USB), High Costs Ail
Per the Zacks analyst, inorganic growth moves, diverse revenue streams and a solid balance-sheet position aids U.S. Bancorp's financials. Yet, rising costs might limit bottom-line growth in near term.

Solid R&D Investments Aid Otis (OTIS), Currency Risks Hurt
Per the Zacks analyst, strategic R&D investments, operational improvements, higher backlog aid Otis. However, foreign exchange risks ail.

Strong Portfolio & Acquisitions to Drive PTC's Performance
Per the Zacks analyst, PTC's performance is being driven by robust demand for products like Creo and Windchill. Strategic acquisitions have played a pivotal part in boosting the company's business.

Digital Transformation and Acquisitions Aid Amdocs (DOX)
Per the Zacks analyst, Amdocs is benefiting from ongoing digital transformations and adoption of its cloud services. Moreover, strategic acquisitions like Sourced and Openet are a positive.

Customer Growth, Investment Aid Pinnacle West Capital (PNW)
Per the Zacks analyst Pinnacle West is gaining from customer additions, which is creating demand. Investment in infrastructure and energy generation is aiding it to serve customers efficiently.

New Upgrades

Solid Bookings & Fleet Expansion to Aid Royal Caribbean (RCL)
Per the Zacks analyst, Royal Caribbean is likely to benefit from robust booking trends, strong demand for Caribbean itineraries and digital innovations. Also, focus on fleet expansion bode well.

Strong Demand, New Products Drive FMC Corp (FMC)
Per the Zacks analyst, strong demand for herbicides and insecticides will drive the company's top line. It should also gain from efforts to expand product portfolio through new product launches.n

Ligand's (LGND) Technology Platforms Boost Growth Prospects
The Zacks Analyst is encouraged by Ligand's Captisol technology platform which has resulted in partnerships with several leading drug companies and driving its revenues for the past few years.

New Downgrades

Equinor (EQNR) Hurt by Aggressive Capital Spending Budget
The Zacks analyst is concerned about Equinor's aggressive capital spending budget, which can affect its profitability. The company's rising exploration expenses are also concerning.

Weak Retention & Growing Debt Affect ProAssurance (PRA)
Per the Zacks analyst, volatility in ProAssurance's premium retention in physician business can hinder top line growth. Also, a rising debt level is concerning.

Air Transport Services (ATSG) Reels Under High Expenses
The Zacks analyst is worried about the elevated operating expenses. ATSG's debt load is bothersome too. Weakness in the cargo market is another headwind.

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

U.S. Bancorp (USB) : Free Stock Analysis Report

Edwards Lifesciences Corporation (EW) : Free Stock Analysis Report

The Home Depot, Inc. (HD) : Free Stock Analysis Report

The Walt Disney Company (DIS) : Free Stock Analysis Report

Palo Alto Networks, Inc. (PANW) : Free Stock Analysis Report

Linde PLC (LIN) : Free Stock Analysis Report

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Zacks Investment Research