Tuesday, March 21, 2017

Today's Research Daily features new research reports on 16 major stocks, including Wal-Mart (WMT), UnitedHealth (UNH), and Charter Communications (CHTR).

Wal-Mart shares have done better relative to other traditional retailers, but they have lagged the broader market in the year-to-date period, likely reflecting uncertainty related to border adjusted tax changes. Offsetting the tax law uncertainty is the improved outlook for Wal-Mart's core U.S. operations and greater confidence in the company's digital strategy. The company's better than expected quarterly earnings report about a month ago on the back of higher comparable store sales, and momentum at Wal-Mart U.S and Sam’s Club divisions offsetting weakness from the international business. In today's research report, the analyst discusses the pros & cons of investing in Wal-Mart shares. The analyst likes the company's focus on its online presence, with the recent ShoeBuy acquisition following the earlier Jet.com purchase geared towards that end. That said, investments in wages and e-commerce activities will likely weigh on near-term profitability. (You can read the full research report on Wal-Mart  here >>)

Buy-rated UnitedHealth shares have gained +31.3% over the past 12 months, outperforming the Zacks Medical Health Maintenance Organization industry, which has gained +23.5% over the same period. UnitedHealth’s better-than-expected fourth quarter earnings were driven by strong results from both UnitedHealth Care and Optum segments.. The analyst likes that fact that the company is consistently gaining from the Medicaid and Medicare businesses. Continued growth at Optum is also creating a diversified revenue source. Also, UnitedHealth should benefit from its capital strength and niche market position. But losses on public exchange business and higher operating costs are some of the headwinds. (You can read the full research report on UnitedHealth here >>)

Charter Communications outperformed the Zacks Cable TV industry over the past three months (+44% vs. +34.7%), with the company's strong financial results in the fourth-quarter helping the momentum. The Zacks analyst is particularly optimistic about the company’s merger with Time Warner Cable and Bright House Networks, which have strengthened its foothold in hybrid fiber coax (HFC) and fiber networks. The merger is expected to allow Charter to offer enhanced services and more streaming video product options to its customers. Charter has also announced that it will venture into the U.S. wireless market. The company is planning to execute 5G network trials. However, online videos provide an extremely cheap source of TV programming and are gaining momentum, threatening the pay TV model. (You can read the full research report on Charter Communications here >>)

Other noteworthy reports we are featuring today include Bank of America (BAC), ExxonMobil (XOM) and Caterpillar (CAT).

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Sheraz Mian

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 >>>