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Top Analyst Reports for Fomento Economico Mexicano, NextEra Energy & Charter Communications

Thursday, April 27, 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 Fomento Económico Mexicano, S.A.B. de C.V. (FMX), NextEra Energy, Inc. (NEE) and Charter Communications, Inc. (CHTR). 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 Fomento Economico Mexicano have outperformed the Zacks Beverages - Soft drinks industry over the past year (+28.7% vs. +10.7%). The company’s top line surpassed consensus and grew year over year, driven by growth across all business units. Continued strength at OXXO Mexico led to a double-digit same-store sales increase. Also, OXXO Gas performed well, owing to increased volume recovery and strong operating leverage.

Fomento Economico Mexicano’s digital initiatives and business expansion endeavors have also been aiding results. Its efforts to expand in the U.S. specialized distribution segment bodes well. The company displays strong financial flexibility.

However, FEMSA continued to witness gross margin decline due to inflationary pressures. Also, the fourth-quarter bottom line lagged the Zacks Consensus Estimate.

(You can read the full research report on Fomento Economico Mexicano here >>>)

NextEra Energy’s shares have outperformed the Zacks Utility - Electric Power industry over the past year (+3.0% vs. -8.7%). The company continues to expand its operations through organic projects and strategic acquisitions. NEE has many renewable projects in its backlog and their completion will reduce emissions.

The merger of Gulf Power and FPL strengthens NextEra’s position in Florida. FPL’s customer base is expanding as Florida’s economy improves and continues to boost demand for its services. NextEra has ample liquidity to meet its near-term debt obligations and efficient debt management acts as a tailwind.

However, due to the nature of its business, it is subject to complex regulations. Risk in operating nuclear units, unfavorable weather conditions and an increase in supply costs adversely impact earnings.

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

Shares of Charter Communications have underperformed the Zacks Cable Television industry over the year-to-date period (-5.4% vs. +0.8%). The company is suffering from video-subscriber attrition, primarily due to cord-cutting and stiff competition from streamers like Netflix and Disney+. Internet user base expansion has started to slow down with the reversal of pandemic trends. The leveraged balance sheet is a concern.

However, Charter Communications’ prospects are riding on strong growth in residential, mobile and commercial revenues. The company continues to expand Internet subscriber base as well as witnessed strong mobile line growth. Charter’s expanding mobile-subscriber base has been a key catalyst.

The momentum is likely to continue in the near term. Charter’s broadband service has gained traction among small and medium businesses. The company is working to improve speed and latency of its network.

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

Other noteworthy reports we are featuring today include General Electric Co. (GE), Phillips 66 (PSX) and Incyte Corp. (INCY).

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

Continued Digital Investments to Drive FEMSA'S (FMX) Growth

Steady Investment & Renewable Focus Aid NextEra Energy (NEE)

ADVERTISEMENT

Mobile & Internet Subscriber Gain Benefits Charter (CHTR)

Featured Reports

Phillips 66 (PSX) Banks on Midstream, Refining Hurts
The Zacks analyst likes Phillips 66 since it is focusing on more profitable midstream and chemical businesses. Lower contribution from refining will hurt the bottom-line.

Incyte (INCY) Jakafi Fuels Growth, Competition a Concern
Per the Zacks analyst, consistent growth in Incyte fueled by patient demand and encouraging uptake of other recently approved drugs should fuel Incyte. However, competition for Jakafi is stiff.

Solid Commercial Lines Aid Cincinnati Financial (CINF)
Per the Zacks analyst, Cincinnati Financial is poised to grow on the strength of Commercial Lines segment as well as price rise and a higher level of insured exposures.

Solid Land Buyouts Aid PulteGroup (PHM) Amid Increased Costs
Per the Zacks analyst, robust land acquisitions and operational strategic initiatives aid PulteGroup. However, increased costs and soft housing demand hurt growth.

Akamai (AKAM) Rides on Solid Cloud, Security Solutions Demand
Per the Zacks analyst, Akamai is likely to gain from the increasing adoption of cloud computing technologies and rising demand for security solutions, triggered by 5G deployment and IoT proliferation.

Strength in End Market Aids Flowserve (FLS) Amid Forex Woes
Per the Zacks analyst, Flowserve will benefit from strength across its oil & gas, chemical, power, general industries and water end markets. However, forex woes are concerning for the company.

Air-Travel Demand Aids Allegiant (ALGT), Fuel Costs Ail
Upbeat air-travel demand is driving Allegiant's top line. The Zacks analyst is, however, worried about escalated fuel costs that are limiting bottom-line growth.

New Upgrades

General Electric (GE) Rides on Aerospace Segment Growth
The Zacks analyst is encouraged by strength in the company's Aerospace segment due to continued recovery in the commercial market. The company's improved 2023 guidance adds to the positivity.

Solid Underwriting, Capital Deployment Aid RLI Corp (RLI)
Per the Zacks analyst, RLI's solid portfolio, business expansion, rate rise, expanded distribution and operational strength drives profitability, in turn supports dividend hikes, special dividends.

Stratasys (SSYS) Rides on Partnership Wins, Product Strength
Per Zacks analyst, Stratasys' expanding partner ecosystem along with firm focus on launching new products are contributing to business wins and boosting its presence globally.

New Downgrades

Petrobras (PBR) Hurt by Rise in Lifting Costs
The Zacks analyst believes that the continued rise in pre-salt lifting costs is having a negative effect on Petrobras' upstream segment earnings.

The Children's Place (PLCE) Battles Inflationary & Other Woes
Per the Zacks analyst, The Children's Place is witnessing soft consumer demand stemming from inflationary pressures. Also, increased supply chain costs and lower merchandise margins remain deterrents.

Inflationary Pressures Hurt Papa John's (PZZA) Prospects
Per the Zacks analyst, Papa John's operations are likely to be affected by commodity inflation and a tight labor market. Also, deteriorating economic conditions in the United Kingdom remains a concern

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

General Electric Company (GE) : Free Stock Analysis Report

NextEra Energy, Inc. (NEE) : Free Stock Analysis Report

Fomento Economico Mexicano S.A.B. de C.V. (FMX) : Free Stock Analysis Report

Incyte Corporation (INCY) : Free Stock Analysis Report

Charter Communications, Inc. (CHTR) : Free Stock Analysis Report

Phillips 66 (PSX) : Free Stock Analysis Report

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Zacks Investment Research