Wednesday, January 25, 2023

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 Comcast Corporation (CMCSA), Aon plc (AON) and Trane Technologies plc (TT). 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 Comcast have declined -17.4% over the past year against the Zacks Cable Television industry’s decline of -23.1% and the S&P 500 index's -8.9% pullback. The company persistently suffers from video-subscriber attrition due to cord cutting. Moreover, broadband prospects are suffering from increased competition from fixed wireless as well as fiber. Additionally, a leveraged balance sheet is a major concern.

On the positive side, Comcast should continue to benefit from a growing wireless subscriber base as witnessed in the third quarter. Broadband user base increased in the last reported quarter on October 27th (the company is scheduled to report Q4 results on Thursday, January 26th). Comcast’s plan to transition to DOCSIS 4.0 is noteworthy. The technology will help it in expanding much faster and at a lower cost compared to competitors.

Recovery in park and movie business bodes well for Comcast’s profitability. Its streaming service Peacock is a key catalyst in driving broadband sales. Strong free cash flow generation ability is noteworthy.

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

Aon shares have outperformed the Zacks Insurance - Brokerage industry over the past year (+21.2% vs. +14.4%). The company’s top line has been growing on buyouts and alliances, which have enhanced its capabilities and made it one of the largest insurance brokers. Solid Reinsurance Solutions and Commercial Risk Solutions segments continue to drive the top line.

Aon has been divesting non-core operations to streamline its business. It expects that focusing on more profitable operations will generate a higher return on equity. Its pooled employer plan has reached the milestone of $1 billion in U.S. assets and commitments.

The company engages in prudent capital deployment. It had around $6.7 billion fund left under its share buyback program as of Sep 30, 2022. Yet, elevated operating costs can put pressure on margins. A debt-laden balance sheet compared with a lower cash balance raises a concern.

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

Trane Technologies shares have outperformed the Zacks Technology Services industry over the past year (+1.3% vs. -30.4%). The company remains focused on improving the quality of its products and services and operating efficiencies to achieve sustained improvement in earnings and cash flow. It prioritizes improving its business operating system and innovation through business transformation initiatives and prudent investments.

Trane has a track record of repurchasing shares and paying dividends consistently. Such moves instil investor confidence and positively impact the company's bottom line.

However, product and service diversity put's Trane in the face of fierce competition in terms of price, quantity, delivery, service, support, technology and innovation. The company’s business experiences seasonal fluctuations in revenues. Lower liquidity remains a concern. Partly due to these headwinds, the stock has declined in the past year.

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

Other noteworthy reports we are featuring today include Huntington Bancshares Incorporated (HBAN), Atmos Energy Corporation (ATO) and Teleflex Incorporated (TFX).

Director of Research

Sheraz Mian

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>>>