Top Analyst Reports for Alphabet, Procter & Gamble & Alibaba

Wednesday, May 10, 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 Alphabet Inc. (GOOGL), The Procter & Gamble Co. (PG) and Alibaba Group Holding Ltd. (BABA). 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 Alphabet have gained +11.3% over the past six months against the Zacks Internet - Services industry’s gain of +11.8%. The company’s strong cloud division is aiding substantial revenue growth. An expanding data center network and a rising number of infrastructure regions will continue to bolster its presence in the cloud space.

Also, strong focus on innovation of AI techniques, and growing interest in home automation space should aid business growth in the long term. Its deepening focus on the wearables category remains a tailwind. Further, Alphabet’s expanding presence in the autonomous driving space is contributing well.

Alphabet’s growing efforts to gain foothold in the healthcare industry are other positives. However, sluggishness in the company’s advertisement business remains a major headwind. Additionally, its growing litigation issues and increasing expenses are concerns.

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

Procter & Gamble’s shares have gained +10.4% over the past six months against the Zacks Soap and Cleaning Materials industry’s gain of +12.8%. The company continued its robust top and bottom-line surprise trend for the third consecutive quarter in its fiscal Q3 recently reported. However, sales and earnings declined year over year.

Procter & Gamble’s organic sales grew, driven by robust pricing and a favorable mix, along with strength across segments. It has been focused on productivity and cost-saving plans to boost margins. Consequently, it raised the sales view to 1% growth compared with our estimate of a 1.1% rise for fiscal 2023.

However, the company has been witnessing supply-chain issues, higher transportation costs, geopolitical challenges, currency headwinds and rising inflation. As a result, the company retained its drab earnings view for fiscal 2023. Also, an unfavorable currency has been concerning.

(You can read the full research report on Procter & Gamble here >>>)

Shares of Alibaba have outperformed the Zacks Internet - Commerce industry over the past six months (+16.1% vs. +4.8%). The company’s solid momentum across the international commerce retail businesses is driving its top-line growth. The Zacks analyst expects the business to be up 9.1% in fiscal 2023 on a year-over-year basis.

Additionally, solid momentum across financial services, education and automobile industries is driving the company’s cloud business. According to our estimates, cloud revenues are expected to witness a 3.3% rise in fiscal 2023 from fiscal 2022. This apart, strength across the local consumer services and Cainiao logistics services, Alibaba Health and Freshippo is contributing well.

However, uncertainties associated with Covid-related issues in its home country remain major concerns, especially domestically. Also, rising expenses associated with new initiatives are overhangs. Additionally, softness in digital media business is a headwind.

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

Other noteworthy reports we are featuring today include TransDigm Group Inc. (TDG), Yum! Brands, Inc. (YUM) and Nucor Corp. (NUE).

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

Alphabet (GOOGL) Benefits From Cloud & Search Initiatives

P&G's (PG) Productivity & Cost Savings Plan to Aid Margins

Retail & Cloud Businesses Momentum Benefits Alibaba (BABA)

Featured Reports

U.S. Budget to Aid TransDigm (TDG) Amid Supply Chain Woes
Per the Zacks analyst, expansionary budgetary policy adopted by the U.S. administration should benefit TransDigm. Yet consistent supply chain challenges might impact the stock.

YUM! Brands (YUM) Banks on Digital Efforts, High Costs Ail
Per the Zacks analyst, YUM! Brands focus on digital initiatives and refranchising efforts bode well. However, rise in operating expenses remain a headwind.

Nucor (NUE) Gains on Strong Demand, Expansion Actions
Per the Zacks analyst, Nucor will benefit from strong demand in its major end markets. Efforts to boost production capacity through several growth projects will also drive profitability.n

Digital Transformation and Acquisitions Aid Tyler (TYL)
Per the Zacks analyst, Tyler is benefiting from ongoing digital transformations and adoption of its cloud-based solutions. Moreover, strategic acquisitions like Quatred and Safeground are positive.

Veoneer Active Safety Business Buyout to Buoy Magna (MGA)
While the impending acquisition of Veoneer Active Safety business is set to rev up Magna's ADAS business, the Zacks analyst is worried of the firm's high capex needs which may hurt cash flows.

NOV Inc. (NOV) to Benefit from Large Installed Base of Rigs
The Zacks analyst believes that NOV's large installed base of rigs worldwide will provide it with a steady recurring revenue stream but is worried over the low dividend yield.

Alkermes (ALKS) Diversified Portfolio Fuels Growth
Per the Zacks analyst, marketed drugs like Vivitrol, Aristada, and Lybalvi should fuel growth for Alkermes. However, Alkermes is highly dependent on manufacturing and royalty revenues.

New Upgrades

Martin Marietta (MLM) Benefits From Solid Pricing Actions
Per the Zacks analyst, Martin Marietta's first quarter margin expansion was driven by solid pricing actions despite inflationary pressure and modestly lower aggregate shipments.

Solid In-force Business Aids Reinsurance Group (RGA)
Per the Zacks analyst, Reinsurance Group is set to benefit from better pricing and expanding business in the pension risk transfer market. Solid in-force business ensures predictable long-term earning

Radian Group (RDN) is Set to Grow on New Insurance Written
Per the Zacks analyst, Radian is set to grow on new insurance written aided by strong mortgage origination market, higher refinance activity and higher private mortgage insurance penetration rates.

New Downgrades

Limited Users, Regulations Ail NextEra Energy Partners (NEP)
Per the Zacks analyst NextEra Energy Partners' dependence on a limited group of customers for revenues and to adherence of stringent laws and regulations could adversely impact its operations.

Werner Enterprises (WERN) Reels Under Freight Demand Woes
Werner Enterprises is suffering from weak freight demand. The Zacks analyst is also worried about the elevated operating expenses.

Weakness in Smartphone Market Hurts Cirrus Logic (CRUS)
Per the Zacks analyst, Cirrus's performance was affected due to reduced smartphone sales volume and lower general market sales. Also, prolonged weakness in China's smartphone market is a concern.

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Procter & Gamble Company (The) (PG) : Free Stock Analysis Report

Nucor Corporation (NUE) : Free Stock Analysis Report

Yum! Brands, Inc. (YUM) : Free Stock Analysis Report

Transdigm Group Incorporated (TDG) : Free Stock Analysis Report

Alphabet Inc. (GOOGL) : Free Stock Analysis Report

Alibaba Group Holding Limited (BABA) : Free Stock Analysis Report

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