Friday, August 11, 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 Oracle Corporation (ORCL), Chevron Corporation (CVX) and Linde plc (LIN). 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 >>>

Oracle shares have handily outperformed the Zacks Computer - Software industry over the past year (+45.1% vs. +14.1%), reflecting momentum across its cloud business on the back of strong uptake of Oracle Cloud Infrastructure services and Autonomous Database offerings. Solid adoption of cloud-based applications, comprising NetSuite Enterprise Resource Planning (ERP) and Fusion ERP bodes well.

Oracle’s Gen 2 Cloud is delivering better performance at a lower cost due to high bandwidth and low-latency RDMA networks. Partnerships with NVIDIA and Microsoft benefits Oracle. Oracle is partnering with NVIDIA to build the world's largest high-performance computer, an AI computer, with 16,000 GPUs.

The company also announced that it is launching a generative AI cloud service for enterprise customers. Shares have outperformed the industry year to date. However, stiff competition is hurting growth.

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

Shares of Chevron have gained +4.2% over the past year against the Zacks Oil and Gas - Integrated - International industry’s gain of +14.7%. The company is considered one of the best-placed global integrated oil firms to achieve sustainable production ramp-up.

America’s No. 2 energy firm’s existing project pipeline is among the best in the industry, thanks to its premier position in the lucrative Permian Basin. As a reflection of these positives, we saw CVX’s EPS jump 132% in 2022.

However, Chevron was not immune to the commodity price crash of 2020, forcing it to cut spending substantially. The company’s high oil price sensitivity is a concern too. Moreover, the supermajor’s 10-year reserve replacement ratio of 100% is indicative of its inability to replace the amount of energy produced.

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

Linde shares have outperformed the Zacks Chemical - Specialty industry over the past year (+24.6% vs. +4.5%), reflecting favorable outlook for industrial gases. The company’s primary products in industrial gases include oxygen, which is used as life support in hospitals.

Linde has long-term contracts with on-site customers backed by minimum purchase requirements, thereby securing stable cashflows. In the profitable industrial gas market, the merger of Praxair and Linde has created an efficient player with considerable size advantages. Linde reported strong second quarter earnings aided by higher pricing from its Americas segment.

However, declining free cashflow is a concern, reflecting weakness in operating activities. Moreover, the company is extremely vulnerable to uncertainty associated with the slowdown of economic growth, as this could hurt demand for its industrial gases.

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

Other noteworthy reports we are featuring today include The Walt Disney Company (DIS), Bristol-Myers Squibb Company (BMY) and Airbnb, Inc. (ABNB).

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>>>