Top Stock Reports for General Dynamics, Verizon & AIG

Friday, April 13, 2018

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 General Dynamics (GD), Verizon Communications (VZ) and American International Group (AIG). 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 >>>

General Dynamics's shares underperformed the Zacks Aerospace – Defense industry in the last year (+16.9% vs. +49.2%). The company operates in a highly competitive market and has to rely on other companies to provide materials, components and subsystems for its products. The company’s dependence on international sales for a major portion of its revenues exposes it to the risk of currency fluctuations and other geo-political risks.

However, General Dynamics remains one of the only two contractors in the world equipped to build nuclear-powered submarines and its diverse portfolio of products and services. Moreover its wide customer base provides it with an opportunity to generate solid revenues from different sources.

The company will likely see solid growth momentum, following the introduction of the G600 in 2018. General Dynamics is committed to R&D activities that facilitate the introduction of new products and first-to-market enhancements.

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

Shares of Verizon have declined -0.8% over the last six months, outperforming the Zacks Wireless National industry’s loss of -3.4% during the same period.Verizon’s unlimited data plans have heated up the wireless industry and helped it gain additional postpaid customers. The company’s plan to launch 5G wireless broadband services in select U.S. cities in 2018, in order to boost its market presence, remains well on track. The company expects growth in 2018 on the back of the expected savings from tax reform.

However, Verizon continues to struggle in a highly competitive and saturated wireless market. Losses in wireline access lines, higher marketing costs of promotional plans and competitive video market remain major impediments. Verizon’s wireline division is struggling with persistent losses in access lines owing to competitive pressure from VoIP service providers and aggressive triple-play offerings by cable companies. All these are likely to weigh on the company’s revenues and margins.

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

AIG’s shares underperformed the Zacks Multi-Line Insurance industry year to date, losing -10.2% vs. -6.2%. The company has been suffering from tough market conditions and its massive size with numerous uncorrelated businesses creating little or no synergy. Weakness in its General Insurance segment and an exposure to catastrophes continue to bother.

However, AIG’s strategic divestitures have streamlined the company’s core operations. Strong performance of its Life and Retirement Segment remain major positives. Recently, the insurance giant appointed Brian Duperreault as its new CEO with expectations of improving operations by completing ongoing restructuring initiatives and making additional changes. Moreover, its strong fundamentals should support its share performance going forward.

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

Other noteworthy reports we are featuring today include Johnson Controls International (JCI), Humana (HUM) and eBay (EBAY).

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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

Robust Demand and Jet Sales Growth Aid General Dynamics (GD)

Verizon (VZ) 5G Launch on Track, Wireline Woes Persist

AIG Gains from Strong Life Segment, Falling Revenue Hurts

Featured Reports

Bakken Pipeline Aids Energy Transfer (ETP) Amid Mariner Woes

While Bakken pipeline is driving Energy Transfer's sales and DCF, the covering analyst remains concerned regulatory setbacks suffered by Mariner East Pipeline.

Fleet Upgrade Aids Spirit (SAVE) Amid Unit Revenue Woes

The Zacks analyst likes the efforts to modernize its fleet. Lower costs due to operational efficiency is likely to boost the bottom line in Q1.

Rising Assets and Cost Control Efforts Support Lazard (LAZ)

Per the Zacks analyst, Lazard's investment strategies in equity and fixed income markets might boost assets under management. Focus on cost savings may enhance its profitability.

Ulta Beauty's (ULTA) Loyalty Program is Likely to Drive Sales

Per Zacks analyst, Ulta Beauty's loyalty program will continue to boost its top line via excellent marketing and merchandising endeavors.

eBay (EBAY) Rides On Marketplace Growth; Competition A Risk

The Zacks analyst believes that growth in company's core marketplace business and mobile strategy remain positives. However, competition in the e-commerce market remains a concern.

Buyouts Strengthen Envision Healthcare's (EVHC) Top Line

Per the Zacks analyst, apart from strong segmental performance, accretive acquisitions in the Physician Services market bolster Envision Healthcare's revenue base.

Fastenal (FAST) Strong on Onsite Locations, Weak Margins Ail

Fastenal's investment to boost Onsite locations, vending machines count and e-commerce business is expected to boost sales. However, unfavorable product mix are hurting margins.

New Upgrades

Strategic Expansion of Medicare Business Aids Humana (HUM)

Per the Zacks analyst, continued expansion of Government plans (especially Medicare and Medicaid) favor Humana's profitability, The company also forms alliances to boost its Government business.

Strong End Market & Product Portfolio Benefits AMETEK (AME)

The Zacks analyst believes that robust product portfolio and strong end market is driving top-line growth. Moreover, improving customer base is positive.

Rising Assets and Cost Control Efforts Support Lazard (LAZ)

Per the Zacks analyst, Lazard's investment strategies in equity and fixed income markets might boost assets under management. Also, focus on cost savings will likely enhance its profitability.

New Downgrades

Commodity Prices & Divestitures Hurt Johnson Controls (JCI)

Per the Zacks analyst, volatile prices of steel, aluminum & copper impact Johnson Controls' Building unit. Also, divestiture of several businesses is hurting its profits due to high separation costs.

Alexandria's (ARE) Financials to Bear the Brunt of Rate Hike

Despite decent fundamentals of the life-science industry, the Zacks analyst remains concerned about the impact of interest-rate hike and fluctuation in currency on Alexandria's financials.

High Commodity Pricing Hurts Hewlett Packard's (HPE) Margins

Per the Zacks analyst, Hewlett Packard's margins will continue to be negatively impacted by competitive pricing as well as heightened commodity pricing in the near term.

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Verizon Communications Inc. (VZ) : Free Stock Analysis Report
 
Johnson Controls International plc (JCI) : Free Stock Analysis Report
 
Humana Inc. (HUM) : Free Stock Analysis Report
 
General Dynamics Corporation (GD) : Free Stock Analysis Report
 
eBay Inc. (EBAY) : Free Stock Analysis Report
 
American International Group, Inc. (AIG) : Free Stock Analysis Report
 
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