Top Research Reports for Tesla, Zoetis, Target

Wednesday, April 8, 2020

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 Tesla (TSLA), Zoetis (ZTS) and Target (TGT). 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 >>>

Tesla’s shares have outperformed the Zacks Domestic Automotive industry over the past six months (+123.1% vs. +9.6%). The Zacks analyst believes that rising Model 3 delivery, which forms bulk of the automaker’s overall deliveries, is aiding the company’s top-line growth.

With Model 3 sedan being its flagship vehicle, Tesla has established itself as a leader in the EV segment. Tesla’s upcoming product launches, including Model Y and Semi Truck, are expected to further boost prospects.

However, with China being an important market for Tesla, economic slowdown in the country is weighing on the firm. Tesla’s massive debt and high capex also play spoilsports. Waning demand for Model S/X is another concern. Thus, investors are advised to wait for a better entry point.

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

Shares of Zoetis have gained 24.3% over the past year against the Zacks Drugs industry’s fall of -23.6%. The Zacks analyst believes that key dermatology products, such as Apoquel and Cytopoint, continue to penetrate the market and generate additional revenues.

Zoetis maintains momentum on the back of growth in new parasiticide products, vaccines and a solid dermatology portfolio. Increased sales of parasiticides, including ProHeart 12 and Simparica, further boosted performance. The Abaxis acquisition has further strengthened its leading portfolio. Zoetis has been making other prudent acquisitions.

However, the cattle market is witnessing challenges for beef and dairy customers. Moreover, the swine market is being affected by the African swine fever in China. Competition is stiff as well.

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

Target’s shares have lost -20.5% over the past three months against the Zacks Retail- Discount & Variety industry’s fall of -12.3%. The Zacks analyst notes that Apparel & Accessories’ performance remained soft. Management remains wary of persistent decline in higher-margin discretionary items sales due to the coronavirus outbreak.

The stock came under pressure in spite of the company witnessing higher traffic and sales for Essentials and Food & Beverage categories in the month of March. Owing to the pandemic, Target has not only withdrawn its first-quarter and fiscal 2020 view but also shifted certain strategic projects.

Nonetheless, the company remains focused on enhancing omni-channel capabilities, expanding same-day delivery options and rationalizing supply chain. However, management sees additional $300 million cost rise for the first quarter putting pressure on margins.

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

Other noteworthy reports we are featuring today include Boston Scientific (BSX), Moody's (MCO) and Aon plc (AON).

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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

Tesla (TSLA) Aided by High Demand for Model 3 Amid Debt Woes

New Products, Acquisition Fuel Zoetis (ZTS) Amid Competition

Essentials Items Lift Target's (TGT) Sales, Cost a Concern

Featured Reports

New Buyouts to Aid Boston Scientific (BSX), Pacer Sales Hurt

The Zacks analyst looks forward to Boston Scientific's three compelling buyouts-Claret, VENITI and Augmenix, all of which target high-growth markets.

Buyouts Aid Moody's (MCO) amid Slowdown in Bond Issuances

Per the Zacks analyst, synergies from strategic acquisitions and efforts to diversify revenue base will likely aid Moody's.

Strategic Initiatives Aid, High Leverage Hurts Aon (AON)

Per the Zacks analyst, a series of buyouts and partnerships over the past few years have helped Aon expand its business, leading to overall growth. However, high debt level continues to bother.

BCE Gains From Robust Wireless & Media Operating Segments

Per the Zacks analyst, BCE continues to gain from postpaid customer growth and a greater contribution from prepaid services along with Crave subscriptions and contract renewals with TV distributors.

Non-Memory Segment Drives Lam Research (LRCX); Risks Remain

The Zacks analyst believes that strength in device architectures and non-memory segments will drive its top line. However memory segment weakness and U.S.-China trade war remain headwinds.

Realignment Measures to Aid Nordson (NDSN), Market Woes Drag

Per a Zacks analyst, Nordson's (NDSN) realignment actions will help in organic growth, buyouts, talent development and gaining from Nordson Business System.

PulteGroup (PHM) Gains From Land Acquisitions, Costs High

Per the Zacks analyst, PulteGroup continues to benefit from its land acquisition strategies that have resulted in higher revenues and profitability. However, high land/labor costs pose concerns.

New Upgrades

Segmental Growth Aids Bio-Rad (BIO), QX ONE Uptake Solid

The Zacks analyst is optimistic about the robust growth of Bio-Rad's operating segments and key product lines across major geographies. Continued uptake of QX ONE system remains impressive.

Robust Demand for InfiniBand Solutions Aids Mellanox (MLNX)

Per the Zacks analyst, Mellanox is benefiting from robust demand for its InfiniBand solutions. Further, growing clout of its ethernet adapters, switches and LinkX cables is a key catalyst.

High Consumer Loan Demand, Buyouts Aid Ally Financial (ALLY)

Per the Zacks analyst, Ally Financial's efforts to diversify revenues and rise in demand for consumer loans will aid profitability. Expansion through opportunistic buyouts will be earnings accretive.

New Downgrades

Bleak Air-Travel Demand Mars Southwest's (LUV) Prospects

The Zacks analyst is anxious about the coronavirus-induced weak air-travel demand, which is eating into Southwest's top line. Prolonged grounding of Boeing 737 MAX jets is also a setback.

Coronavirus Woes and SG&A costs To Weigh on CarMax (KMX)

Falling consumer demand for vehicle purchases amid coronavirus dims revenue and earnings prospects for CarMax. Rising SG&A costs are likely to further clip its profit margins.

Pilgrim's Pride (PPC) Grapples With Mexico Region Headwinds

Pilgrim's Pride has been facing weak macro conditions in Mexico, including soft consumer spending. This, along with lower chicken prices in the commodity space is concerning, per the Zacks analyst.

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Zoetis Inc. (ZTS) : Free Stock Analysis Report
 
Tesla, Inc. (TSLA) : Free Stock Analysis Report
 
Target Corporation (TGT) : Free Stock Analysis Report
 
Moody's Corporation (MCO) : Free Stock Analysis Report
 
Boston Scientific Corporation (BSX) : Free Stock Analysis Report
 
Aon plc (AON) : Free Stock Analysis Report
 
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