Tuesday, September 13, 2016

Today's must-read reports are for Sinopec (SNP), General Electric (GE) and Caterpillar (CAT).

General Electric shares have lagged the market this year on concerns about the conglomerate's order backlog and continued weakness in the energy end-market. This issue notwithstanding, the company has done an excellent job of its plan to reduce its exposure to finance and get back to its industrial and engineering roots. To that end, it is enjoying strong momentum in the power and aviation end markets, partly offset by continued weakness in the energy space. (You can read the full research report on General Electric here>>)

Caterpillar’ shares have been strong performers this year, up more than 18% year-to-date on hopes that the worst was behind this beleaguered mining and construction equipment maker. However, sales growth remains in the red for an unprecedented 44 months. This tough operating environment has forced management to squeeze more expenses out of the operation. The analyst also points to the improving construction sector as a potential offset to the weak mining sector. (You can read the full research report on Caterpillar here>>)

Sinopec shares have been strong performers this year, up more than +16% year-to-date, as some of the more exaggerated fears about China's economy have eased. The Zacks analyst likes this integrated Chinese oil company's massive refining assets that help it benefit from the low crude price environment. Sinopec’s natural gas business has immense potential for growth over the coming years. Additionally, Sinopec’s recent commercial discovery in Shunbei oilfield will likely enhance the company’s crude production capacity significantly. (You can read the full research report on Sinopec here>>)

Other noteworthy reports we are featuring today include Costco (COST), Nike (NKE) and Merck (MRK). The Nike report explains why sneaker giant has been downgraded to Zacks Rank # 4 (Sell) on declining EPS estimates as a result of concerns about its order flow.

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You can find all of today's stock research reports here>>

Sheraz Mian

Director of Research

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