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Top Research Reports for Chevron, Walmart & ConocoPhillips

Mark Vickery

Tuesday, September 17, 2019

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 Chevron (CVX), Walmart (WMT) and ConocoPhillips (COP). 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 >>>

Chevron’s shares have outperformed the Zacks Integrated Oil industry over the past three months (0.9% vs. -5.1%). The Zacks analyst thinks that the company’s existing project pipeline is among the best in the industry, targeting volume growth of around 4-7% in 2019 thanks to planned expansion in the Permian Basin.

Chevron pumped 55% more out of the West Texas shale play in the most recent quarter compared with the year-ago period, with output set to soar in the coming years. Being one of the most oil weighted majors, Chevron is also poised to benefit from the recent Saudi Arabian supply shock and the subsequent advancement of crude oil.

However, there are worries over drop in its refining earnings that once again cut into gains from rising E&P income. The massive capex might also play a spoilsport.

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

Shares of Walmart have gained 16% in the past six months, outperforming the Zacks Supermarkets industry’s rise of 14.2%. The Zacks analyst believes that the company’s focus on strengthening e-commerce and store operations aided it retain sturdy comps trend in first-quarter fiscal 2019, wherein earnings marked its fifth straight beat.

Further, U.S. comps rose for the 19th straight time. Further, e-commerce sales surged on robust and online grocery performances. Encouragingly, e-commerce sales are expected to rise nearly 35% in fiscal 2020. The company is also making efforts to improve its International unit by shifting focus to profitable countries.

However, the addition of Flipkart was a drag on Walmart’s operating income. Moreover, transportation costs, compelling pricing strategy and tariff-related worries are threats to margins. Nonetheless, the Flipkart deal bodes well for the long term.

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

ConocoPhillips’ shares have gained 0.3% year to date, outperforming the Zacks U.S. Integrated Oil industry’s fall of 11% over the same period. ConocoPhillips holds the bulk of acres in the unconventional plays of Eagle Ford shale, Delaware basin and Bakken shale.

From the three oil-rich plays, ConocoPhillips projects compound annual production growth rate of more than 25% from 2017 to 2019. The Zacks analyst believes that there are significant opportunities for ConocoPhillips in the Eagle Ford shale where it owns about 3,400 undrilled locations that could lend access to almost 2.3 billion barrels of oil equivalent estimated potential reserves.

However, ConocoPhillips’ expectation of higher production costs is likely to hurt profits. Moreover, the company’s third-quarter output is expected to be hurt by turnaround activities in Alaska, Asia Pacific and Europe. On top of that, over the past two years, the upstream energy player has been persistently paying lower dividend yield than the industry.

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

Other noteworthy reports we are featuring today include TransDigm Group (TDG), TELUS (TU) and Phillips 66 Partners (PSXP).

5 Stocks Set to Double

Zacks experts released their picks to gain +100% or more in 2020. One is a famous cutting-edge food company that is “hiding in plain sight.” Swamped with competitors and ignored by Wall Street, its stock price floundered. Now, suddenly, it acquired a company that gives it an advantage none of its peers have.

Today, see all 5 stocks with extreme growth potential >>

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

Chevron (CVX) to Gain from Stellar Permian Operation

E-commerce Sales to Fuel Walmart (WMT), Soft Margins a Woe

ConocoPhillips (COP) Banks on Oil-Rich Eagle Ford Acreage

Featured Reports

Perrigo (PRGO) Rides on Restructuring Plans Amid Competition

Perrigo's restructuring initiatives will generate millions in annual savings and allow it to focus on expanding its leading segments.

TELUS (TU) Rides on Wireless & Wireline Subscriber Additions

Per the Zacks analyst, TELUS should continue to benefit from robust subscriber net additions across its service portfolio.

Yelp (YELP) Benefits from Increasing Advertising Revenues

Per the Zacks analyst, increase in the number of paying advertising locations and improved productivity from advertising sales force are bolstering Yelp's ad revenues.

Rising Trading Volume Aid Cboe Global (CBOE), High Costs Ail

Per the Zacks analyst, Cboe Global is set to grow on trading improving volumes given diversified product portfolio that in turn drives transaction fees.

U.S. Dialysis Services Aid DaVita (DVA) Amidst Competition

DaVita has been gaining from strength in dialysis activities in the United States.

Higher Nitrogen Demand, Prices to Aid CF Industries (CF)

While CF Industries faces volume pressure from plant turnarounds, higher global demand and prices for nitrogen fertilizers will drive its sales and margins in 2019, per the Zacks analyst.

Solid Non-Invasive Platform Aids Masimo (MASI) Amid Rivalry

Per the Zacks analyst, Masimo has been consistently gaining from strength in its non-invasive platform. However intense competition in the MedTech space remains a concern.

New Upgrades

Cost Cuts, Strong Demand to Benefit Century Aluminum (CENX)

The Zacks analyst thinks that the company should gain from its actions to reduce operating costs, strong demand for aluminum across automotive and aerospace end-use markets as well as acquisitions.

Acquisitions, Revenue Passenger Miles Aids TransDigm (TDG)

Per the Zacks Analyst, TransDigm strengthens its position in proprietary aerospace components' markets, via strategic acquisitions. Increased revenue passenger miles should also boost revenue growth.

Loan Demand, Dealer Enrollments Aid Credit Acceptance (CACC)

Per the Zacks analyst, higher consumer loan demand, increasing dealer enrollments and active dealers, and strong balance sheet position will support Credit Acceptances profitability, going forward.

New Downgrades

Phillips 66 (PSXP) to be Hurt by Lower Throughput Volume

Per the Zacks analyst, Phillips 66 Partners' plan to half its capital budget through 2019 could affect total throughput volume and reduce profits.

Delphi (DLPH) Continues to Grapple With High Debt, Seasonality

The Zacks analyst believes that high debt may limit Delphi's future expansion and worsen its risk profile. Seasonality causes fluctuations in revenues and profits and makes forecasting difficult.

High Operating Margin Likely to Hurt Extended Stay (STAY)

Per the Zacks analyst, an increase in payroll expenses and a decline in comparable system-wide RevPAR are likely to hurt Extended Stay America's hotel operating margin.

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Walmart Inc. (WMT) : Free Stock Analysis Report
TELUS Corporation (TU) : Free Stock Analysis Report
Transdigm Group Incorporated (TDG) : Free Stock Analysis Report
Phillips 66 Partners LP (PSXP) : Free Stock Analysis Report
Chevron Corporation (CVX) : Free Stock Analysis Report
ConocoPhillips (COP) : Free Stock Analysis Report
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