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The Zacks Analyst Blog Highlights: Walmart, Cisco, Intel, UPS and Wynn Resorts

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For Immediate Release

Chicago, IL – February 22, 2018 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Walmart (WMT - Free Report) , Cisco (CSCO - Free Report) , Intel (INTC - Free Report) , UPS (UPS - Free Report) and Wynn Resorts (WYNN - Free Report) .

Here are highlights from Wednesday’s Analyst Blog:

Top Stock Reports for Walmart, Cisco, Intel & UPS

The Zacks Research Daily presents the best research output of our analyst team. Today's Research Daily features new research reports on 17 major stocks, including Walmart, Cisco, Intel and UPS. These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.

Buy-rated Walmart’s shares have been strong performers lately, with the stock up +17.6% over the last six months, outperforming the S&P 500's +10.9% gain in the same time period. Walmart, which recently emerged as an omni-channel retailer officially, has been riding on constant growth efforts – both in stores and online.

The company’s robust e-commerce initiatives, like buyouts, alliances, online grocery and improved delivery systems have been working well. These trends helped Walmart post its 14th straight quarter of U.S. comps growth in fourth-quarter fiscal 2018, wherein earnings and sales rose year over year.

However, gross margin remained strained owing to mix impact from growing e-commerce operations, price investments and higher markdowns. Also, the rate of e-commerce growth slowed down sequentially.

Nevertheless, management expects U.S. e-commerce sales to jump nearly 40% in fiscal 2019, which should help the company revert to its track of surpassing the industry. The Zacks analyst expects these factors and projected gains from tax reforms to fuel the bottom line.

Shares of Buy-rated Cisco have outperformed the Zacks Networking industry over the past year, gaining +29.3% vs. +27.3%. Cisco reported impressive second-quarter fiscal 2018 results. Both earnings and revenues increased on a year-over-year basis. The growth was driven by strong contribution from acquisitions, security, Infrastructure Platforms and applications.

The Zacks analyst thinks the company’s expanding footprint in the rapidly growing security market presents a significant growth opportunity. Additionally, partnerships with Telenor, Apple, IBM, Microsoft, Google Cloud, Viacom and Alibaba and aggressive share buybacks are other positives. However, weakness in the switching and routing is a headwind.

Moreover, ongoing transition to subscription-based model will continue to hurt the top line. Further, weakness in the service provider business segment and intense competition from the likes of Huawei, Juniper and Arista Networks are other major concerns.

Buy-rated Intel’s shares have underperformed the Zacks General Semiconductor industry over the past one year, gaining +28.5% vs. +53.3%. However, Intel reported stellar fourth-quarter results and provided an encouraging guidance. The company is benefiting from robust performance of the DCG, IoT Group, NSG and PSG. These segments form the crux of Intel’s data-centric business model.

Further, the launch of FPGA SDK for OpenCL solution, Xeon Scalable, Core 8 chips, Myriad X and next-generation desktop processors are key catalysts. Lately, Intel’s Movidius vision processing has gained strong adoption. The processor was selected by Alphabet’s Google division and Amazon.com’s DeepLens. Intel also announced level through five autonomous driving platform based on EyeQ5 and Atom, which will sample over the next few months.

Its partnerships with BMW, Nissan, Volkswagen AG and Ferrari will boost sales of processing chips, sensor-chips, cloud software and many more, which will drive top-line growth. However, stiff competition from peers adds to its woes.

Shares of Buy-rated UPS have underperformed the Zacks Air Freight and Cargo industry as well as rival FedEx in a year's time. While UPS has lost -0.9%, the industry it belongs to and FedEx have rallied +8.7% and +24.3%, respectively. Despite the unimpressive price performance, UPS outperformed in the fourth quarter of 2017.

Also, revenues and earnings per share improved year over year. Results were aided by strong export volumes. Moreover, UPS performed well in the most recent holiday season on the back of e-commerce growth. In February 2018, UPS announced its decision to increase quarterly dividends which is an added positive.

Furthermore, the new tax law (Tax Cuts and Jobs Act), which reduces corporate tax rate significantly, is encouraging. However, high costs continue to limit bottom-line growth. Its forecast for 2018 capex, which is higher than 2017 levels, might push up costs further.

Other noteworthy reports we are featuring today include Wynn Resorts.

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