Thursday, November 30, 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 Exxon Mobil Corporation (XOM), Oracle Corporation (ORCL) and Cisco Systems, Inc. (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 >>>
Shares of Exxon Mobil have underperformed the Zacks Oil and Gas - Integrated - International industry over the past year (-4.4% vs. -2.9%). The company’s dividend yield is lower than the composite stocks belonging to the industry. Thus, ExxonMobil is lagging its peers when it comes to shareholders’ returns.
Moreover, the integrated company reported weak third quarter earnings, primarily resulted from the oil equivalent production decline, and lower realizations of crude and natural gas prices. Nevertheless, ExxonMobil's bellwether status and an optimal integrated capital structure that has historically produced industry-leading returns make it a relatively lower-risk energy sector play.
In Stabroek Block, located off the coast of Guyana, ExxonMobil has made many major discoveries that significantly improve its production outlook. The advantaged growth projects of Guyana have lower greenhouse gas intensity than most of the oil and gas-producing resources across the globe.
(You can read the full research report on Exxon Mobil here >>>)
Oracle shares have gained +44.3% over the year-to-date basis against the Zacks Computer - Software industry’s gain of +57.3%. The company is benefiting from the ongoing momentum across its cloud business, driven by the strong uptake of Oracle Cloud Infrastructure and Autonomous Database offerings. Solid adoption of cloud-based applications, comprising NetSuite Enterprise Resource Planning (ERP) and Fusion ERP bodes well.
Oracle’s Gen 2 Cloud is delivering better performance at a lower cost due to high bandwidth and low-latency RDMA networks. Partnerships with VMWare and Microsoft is helping Oracle win new clientele. ORCL is launching a generative AI cloud service for enterprise customers. Its share buybacks and dividend policy are noteworthy.
However, higher spending on product enhancements, especially toward the cloud platform, amid increasing competition in the cloud domain is likely to limit margin expansion.
(You can read the full research report on Oracle here >>>)
Shares of Cisco Systems have outperformed the Zacks Computer - Networking industry over the year-to-date basis (+4.0% vs. +2.1%). The company is riding on the growing demand for its security, artificial intelligence and cloud products. Its security portfolio is benefiting from the launch of new data loss prevention, firewall and zero trust capabilities.
Zero Trust portfolio is riding on strong demand for its Duo offering. Optimized application experience is benefiting from strong demand for ThousandEyes. Its investments across security business, focusing on cloud-based and AI-driven offerings, is expected to drive growth.
Expanding growth opportunities for low-power-consuming technologies, including IoT, Silicon One and Power over Ethernet bodes well for Cisco. Acquisitions including Lightspin Technologies, Smartlook and Armorblox is expected to benefit top-line growth.
(You can read the full research report on Cisco Systems here >>>)
Other noteworthy reports we are featuring today include Altria Group, Inc. (MO), Duke Energy Corporation (DUK) and CrowdStrike Holdings, Inc. (CRWD).
Director of Research
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
ExxonMobil (XOM) Banks on Offshore Guyana Resources
Oracle (ORCL) Gains from Cloud Suite Adoption & Partnerships
Cisco (CSCO) Rides on Strong Networking Solution Demand
Altria Group (MO) Gains From Solid Pricing Amid Low Volumes
Per the Zacks analyst, Altria Group has been benefiting from its solid pricing power. In third quarter, higher pricing offered respite to revenues, which was otherwise hurt by low cigarette volumes.
Solid Investments Aid Duke Energy (DUK), Weak Solvency Woes
Per the Zacks analyst, Duke Energy's investment in infrastructure and expansion projects tend to boost its long-term growth prospects. However, its weak solvency position remains a bottleneck.
CrowdStrike (CRWD) Rides on Product Strength, Acquisitions
Per the Zacks analyst, CrowdStrike is gaining from solid contributions of its growth-oriented products, primarily Falcon platform. Also, strategic buyouts like Bionic and Reposify are positive.
NetApp (NTAP) Performance Gains Strong Product Portfolio
"Per the Zacks analyst, NetApp's performance gains from demand for product portfolio amid data-driven digital and cloud transformation. Weak IT spending due to macroeconomic weakness is an overhang.nn
E-Commerce Business & B2B Strategy Aid Williams-Sonoma (WSM)
Per the Zacks analyst, Williams-Sonoma is benefiting from its e-commerce business, B2B initiative and expansion plans.
Viatris (VTRS) Restructuring Move Positive, High Debt A Woe
Per the Zacks analyst, Viatris efforts to divest non-core businesses to pay down huge debt is positive. The recent acquisitions to create an ophthalmology franchise will diversify the portfolio
Protiviti's Advancements Aid Robert Half (RHI), Competition Ails
Per the Zacks analyst, Robert Half's Protiviti is in great shape driven by its increasing focus on technology consulting. However, high competition remains a concern.
Cincinnati Financial (CINF) Benefits From Commercial Lines
Per the Zacks analyst, consistent progress at the Commercial Lines Insurance segment backed by solid premiums earned and several growth initiatives contributes to revenue growth of the company.
Solid Excess & Surplus Lines of Business Aids Kinsale (KNSL)
Per the Zacks analyst, Kinsale Capital is set to grow on its focus on the excess and surplus lines of business aiding high retention rates arising from renewals, improved margins and lower loss ratios
Strength in HSA, Investment Platform Aid HealthEquity (HQY)
The Zacks analyst is upbeat about HealthEquity's multiple cloud-based platforms and continued strength in its Health Savings Accounts or HSAs despite its operation in a highly competitive market.
Nabors (NBR) Weighed Down by Massive Debt Burden
The Zacks analyst believes that Nabors Industries' high debt-to-capitalization of 82 % is a concern, as it restricts the company's financial freedom to tap into growth opportunities.
Rising Operating Costs and Forex Woes Hurt MRC Global (MRC)
Per the Zacks analyst, MRC Global is struggling with high operating costs, which in turn, are hurting the company's bottom line. Forex woes are an added concern.
Persistently Rising Expenses to Hurt SEI Investments (SEIC)
Per the Zacks analyst, rising costs due to technological upgrades will likely hurt SEI Investments' profits. The company's increased exposure to fee-based revenues might hamper growth.
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