Wednesday, November 30, 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 Cisco Systems, Inc. (CSCO), Mondelez International, Inc. (MDLZ) and EOG Resources, Inc. (EOG). 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
Cisco
have performed in-line with the Zacks Computer – Networking industry over the past two years (+10.9% vs. +10.5%). The company’s results benefited from strength in its product portfolio, customer segments and momentum in product order growth.
It is benefiting from healthy uptake of identity and access, advanced threat and unified threat management security solutions amid high growth in Internet traffic. The buyout of Acacia is key catalyst. Cisco’s expanding portfolio with the launch of Silicon One-based 8000 routers, Nexus Cloud, Calisti and Panoptica.
Cisco also announced AppDynamics Cloud, a next-gen version of its observability platform for cloud native applications. Cisco’s investments across its security business, focusing on cloud-based offerings, is expected to drive growth. Cisco provided strong outlook for first-quarter fiscal 2023 and fiscal 2023.
(You can
read the full research report on Cisco here >>>
)
Mondelez’s
shares have gained +12.8% over the past year against the Zacks Food – Miscellaneous industry’s gain of +13.4%. The company has been gaining from strength in emerging markets and its core chocolate and biscuit categories. It has also been focused on strengthening areas with higher growth potential through prudent buyouts (like Clif Bar) and divestitures.
These upsides, together with pricing actions, fueled second-quarter 2022 results and led to the raised organic revenue guidance. However, Mondelez is seeing input cost inflation, especially for energy, transportation, packaging, wheat, dairy and edible oils.
It is also navigating through supply-chain bottlenecks due to labor shortages at third parties. Management’s guidance for 2022 reflects anticipation of the elevated cost of goods sold inflation, the timing impact of extra pricing actions and the impacts of the Ukraine war.
(You can
read the full research report on Mondelez here >>>
)
Shares of
EOG Resources
have outperformed the Zacks Oil and Gas – Exploration and Production – United States industry over the past year (+65.5% vs. +49.1%). The company has an attractive growth profile, a huge inventory of drilling opportunities, upper quartile returns and a disciplined management team. It has significant acreages in oil shale plays like Delaware, Bakken and Eagle Ford.
The company has estimated 11,500 net undrilled premium locations in those promising shale plays, brightening the production outlook. Also, EOG’s balance sheet is significantly less levered than the composite stocks belonging to the industry. For this year, EOG Resources announced a special dividend of $1.50 per share.
However, the company’s rising lease and well operating expenses is hurting its bottom-line. Also, the upstream energy company has been paying lower dividends than the composite stocks belonging to the energy sector over the past five years. As such, the stock warrants a cautious stance.
(You can
read the full research report on EOG Resources here >>>
)
Other noteworthy reports we are featuring today include Waste Management, Inc. (WM), Dominion Energy, Inc. (D), and General Mills, Inc. (GIS).
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
Solid Portfolio, Easing Supply Chain Issues Aid Cisco (CSCO)
Mondelez (MDLZ) Gains on Pricing Actions Amid Cost Inflation
EOG Resources (EOG) Banks on Oil-Rich Delaware Basin
Featured Reports
Focused Differentiation Aids Waste Management (WM), Debt High
Per the Zacks analyst, differentiation through capitalization of extensive assets ensures long-term profitable growth for Waste Management. However, a debt-heavy balance sheet remains a concern.
Investment on Infrastructure & Clean Assets Aid Dominion (D)
Per the Zacks analyst, Dominion’s investment of $37 billion through 2026 to enhance clean electricity generation and strengthen its infrastructure will boost its profitability.
General Mills (GIS) Gains From Focus on Accelerate Strategy
Per the Zacks analyst, General Mills is gaining from its Accelerate strategy, as part of which it is competing efficiently via brand building, investing in saving initiatives and reshaping portfolio.
MPLX to Benefit From Rising Demand for Midstream Assets
Per the Zacks analyst, MPLX is well-poised to capitalize on the growing demand for midstream assets to support increasing volumes of crude oil, gas and NGLs in the prolific U.S. shale plays.
VeriSign (VRSN) Gains on Higher Demand for Domain Names
Per the Zacks analyst, VeriSign has been gaining from growth in .com and .net domain name registrations. However, high-debt burden and rising inflation continue to be concerns.
BioMarin’s (BMRN) Progress with Gene Therapy Encouraging
While BioMarin’s existing drugs continue to drive its topline, the Zacks Analyst is encouraged by BioMarin’s launch of two new gene therapy treatments in its portfolio.
Multiple Positive Payer Coverage Updates Aid Nevro (NVRO)
The Zacks analyst is upbeat about Nevro’s multiple positive payer coverage updates for the treatment of Painful Diabetic Neuropathy despite its operation in a highly competitive market.
New Upgrades
Acquisitions, Strong Demand to Aid Reliance Steel (RS)
According to the Zacks analyst, the company will gain from strong demand in the majority of its end markets and its strategy to drive operating results by acquiring high-quality businesses.
Permian Expansion, Acquisitions Drive U.S. Silica (SLCA)
Per the Zacks analyst, the company will gain from its actions to expand in the fast-growing Permian Basin. Sandbox and EP Minerals buyouts also provide a strong platform for growth and expansion.
EverQuote (EVER) Boasts Revenue Growth, Solid Balance Sheet
Per the Zacks analyst, consumer traffic, quote request volume and innovative advertiser products and services drive EverQuote revenues. Its strong balance sheet enables it to fulfill debt obligations.
New Downgrades
Inflationary pressures Hurts Domino’s Pizza (DPZ) Margins
Per the Zacks analyst, inflationary pressures in commodity, labor and fuel costs continues to hurt margins. The company has been witnessing labor challenges in a handful of markets.
Growing Geopolitical Tensions Hurt Applied Materials (AMAT)
Per the Zacks analyst, Applied Materials is facing the negative impacts of the ongoing geopolitical tensions as the U.S. announced new export regulations to cripple Chinese tech companies.
Lower Transactions Amid Rate Hikes to Hurt CBRE Group (CBRE)
Per the Zacks analyst, interest rate hikes and adverse foreign currency movements amid an inflationary environment are likely to hurt CBRE Group’s commercial real estate transactions in the near term.
Zacks Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
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