Monday, December 18, 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 Netflix, Inc. (NFLX), The Boeing Co. (BA) and American Express Co. (AXP). 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 Netflix have outperformed the Zacks Broadcast Radio and Television industry over the year-to-date period (+77.0% vs. +46.8%). The company is benefiting from growing subscriber base thanks to a robust portfolio. Crackdown on password-sharing and the introduction of paid sharing in more than 100 countries, which represents more than 80% of Netflix’s revenue base, is also expected to aid growth.

Netflix’s diversified content portfolio, which is attributable to heavy investments in the production and distribution of localized, foreign-language content, has been driving its growth prospects.

However, stiff competition in the streaming space from the likes of Apple, Amazon Prime Video, Disney+, Peacock and Paramount+ is a headwind. Netflix’s leveraged balance sheet and a higher streaming obligation are concerns. Additionally, unfavorable forex is expected to hurt operating income in the fourth quarter of 2023.

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

Boeing’s shares have outperformed the Zacks Aerospace - Defense industry over the year-to-date period (+77.0% vs. +46.8%). The company remains the largest aircraft manufacturer in the United States in terms of revenues, orders and deliveries. During the third quarter, the jet giant booked 398 net commercial airplane orders.

A strengthening U.S. defense budget should also boost Boeing’s Defense, Space & Security's segment growth. Boeing has ample liquidity to meet its debt obligations in the near term. Our model projects Boeing's total revenues to increase in 2023-2025 period.

However, Boeing expects supply-chain disruptions to continue to harm its operational results, at least in the near term. Its dispute with Embraer over termination of the earlier joint venture might cause it to incur some loss in the future. Rising jet fuel price also poses a threat to the stock’s future growth.

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

Shares of American Express have outperformed the Zacks Financial - Miscellaneous Services industry over the year-to-date period (+24.0% vs. +16.8%). The company’s several growth initiatives, such as launching new products, reaching new agreements and forging alliances, are boosting its revenues. Consumer spending on T&E, which carries higher margins for AmEx, is advancing well.

Its balance sheet looks strong with manageable debt and ample cash. Solid cash-generation abilities enable the pursuit of business investments and prudent deployment of capital via buybacks and dividends.

However, with higher utilization of the firm’s cards, expense in the form of card member services and card member rewards is likely to go up and strain the margins. Business development, data processing and equipment costs expected to rise. A high debt level induces a rise in interest expenses. As such, the stock warrants a cautious stance.

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

Other noteworthy reports we are featuring today include Amazon.com, Inc. (AMZN), BlackRock, Inc. (BLK) and Shopify Inc. (SHOP).

Mark Vickery
Senior Editor

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>>>