Top Stock Reports for JPMorgan Chase, T-Mobile US & SAP

Wednesday, October 12, 2022

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 JPMorgan Chase & Co. (JPM), T-Mobile US, Inc. (TMUS) and SAP SE (SAP). 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 >>>

JPMorgan Chase shares have underperformed the Zacks Banks - Major Regional industry over the past year (-36.7% vs. -30.0%). The company’s volatile nature in the capital markets business and higher mortgage rates are likely to make fee income growth challenging. Our estimates for non-interest income (managed) indicate a decline almost 15% this year. Steadily rising operating expenses remain a key headwind.

Given the possibility of an economic downturn and to meet higher capital requirements, the bank has suspended buybacks. However, opening new branches, strategic buyouts/investments and global expansion and digitization efforts are likely to keep driving the company’s financials.

Further, higher interest rates and steady growth in loan demand are expected to result in a robust improvement in net interest income (NII). Our estimates for NII (managed) suggest a CAGR of around 19% over the next three years.

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

T-Mobile US shares have outperformed the Zacks Wireless National industry over the past year (+17.0% vs. -21.8%). The company is experiencing healthy customer growth driven by diligent execution of operational plans. It is on track to complete the Sprint customer network decommissioning by the year-end.

The company has augmented its 5G footprint by introducing 5G Home Internet services in several states. Its Extended Range 5G covers 320 million people. The Ultra Capacity 5G covers 235 million people. T-Mobile continues to deploy 5G with the mid-band 2.5GHz spectrum from Sprint.

However, it operates in a fiercely competitive and almost saturated U.S. telecom market, which lowers its growth potential to some extent. Several promotional activities to lure additional customers are further eroding its profitability. Furthermore, it is engaging in leasing strategy to gain customers, thereby exposing it to credit risk. Debt obligation woes also persist.

(You can read the full research report on T-Mobile US here >>>)

SAP shares have underperformed the Zacks Computer - Software industry over the past year (-40.8% vs. -30.4%). The company has lowered full-year operating profit guidance due to the €350-million negative impact from the war in Ukraine and expectations of a continued decline in software licenses revenue.

Stiff competition and higher costs to enhance cloud-based offerings is likely to exert pressure on the company’s profitability in the near term. However, SAP’s performance is gaining from strength in its cloud business, especially the new Rise with SAP solution.

Momentum in SAP’s Business Process Intelligence platform, particularly the S/4HANA solutions along with healthy traction witnessed in SuccessFactors Employee Central, Ariba and Fieldglass, Qualtrics and other cloud-based offerings is noteworthy. The company also announced an additional share buyback plan worth €500 million.

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

Other noteworthy reports we are featuring today include Automatic Data Processing, Inc. (ADP), Chubb Ltd. (CB), and The TJX Companies, Inc. (TJX).

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

Higher Rates, Buyouts Aid JPMorgan (JPM), Fee Income a Woe

T-Mobile (TMUS) Benefitting from Healthy Customer Growth

SAP To Benefit From Continued Momentum in Cloud Business

Featured Reports

ADP Rides on Solid Business Model Despite Low Liquidity
The Zacks analyst is positive about ADP's strong business model, high-recurring revenues, healthy margins and robust client retention. However, decreasing current ratio is a headwind.

Chubb (CB) Banks on Acquisitions, Cat Loss an Overhang
Per the Zacks analyst, buyouts have helped Chubb in domestic as well as international expansion and boosted the portfolio of products and services.

The TJX Companies (TJX) Gains From Store & E-Commerce Growth
Per the Zacks analyst, The TJX Companies is gaining on its store and e-commerce growth efforts. The company aims at growing its global store base by at least another 1,500 stores in current locations.

Williams (WMB) to Benefit from Transco-Related Projects
The Zacks analyst believes that Williams' existing and expansionary projects associated with the massive Transco gas transmission system are expected to boost the company's growth prospects.

Solid Storage & Networking Chip Demand Aid Marvell (MRVL)
Per the Zacks Analyst, Marvell is growing on solid demand for its storage and networking chips from accelerated 5G infrastructure deployment and increased adoption of cloud-based storage solutions.

Strong Product Portfolio Buoys Optimism for Baxter (BAX)
Per the Zacks analyst, Baxter International is well poised for growth backed by a strong product portfolio. Introduction of new therapies and products likely to drive the topline growth.

Domestic Focus, Buyout Aid NextEra Energy Partners (NEP)
Per the Zacks analyst NextEra Energy Partners' (NEP) focus to concentrate on domestic renewable operations and expand the same through strategic acquisitions will continue to boost performance.

New Upgrades

Digitization, Retail Loan Growth Supports ICICI Bank (IBN)
Per the Zacks analyst, a rise in digitization and internet banking will aid ICICI Bank's fee income. The company remains poised for growth supported by rise in retail loans and a stable funding base.

Buyouts & Software Capabilities Aid CNH Industrial (CNHI)
The Sampierana and Raven buyouts aid growth in CNH Industrial's agriculture and construction equipment portfolios. Also, per the Zacks analyst, its focus on AI initiatives boosts software development.

Catalyst (CPRX) Rides on Robust Performance of Firdapse
Per the Zacks analyst, solid performance of Catalyst's approved drug, Firdapse, has fueled its growth. Firdapse's recent label expansion for LEMS in children is expected to be a top-line booster.

New Downgrades

Semtech (SMTC) Suffers From Sluggishness in Consumer Market
Per the Zacks analyst, Semtech is witnessing a downslide in the consumer market owing to the weak demand from the Asian smartphone customers due to the ongoing coronavirus pandemic.

Rent-A-Center's (RCII) Namesake Business Remains Sluggish
Per the Zacks analyst, Rent-A-Center has been witnessing softness in its namesake business unit. Revenues at the segment dipped 3.1% in second-quarter 2022 due to same-store sales decline of 3.3%.

Rising Material Costs Hurt Louisiana-Pacific's (LPX) Margin
Per the Zacks analyst, increased marketing investments, along with rising material and transportation costs are pressing concerns for Louisiana-Pacific.

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JPMorgan Chase & Co. (JPM) : Free Stock Analysis Report
 
Automatic Data Processing, Inc. (ADP) : Free Stock Analysis Report
 
The TJX Companies, Inc. (TJX) : Free Stock Analysis Report
 
Chubb Limited (CB) : Free Stock Analysis Report
 
SAP SE (SAP) : Free Stock Analysis Report
 
TMobile US, Inc. (TMUS) : Free Stock Analysis Report
 
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