Thursday, February 22, 2024

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 Microsoft Corp. (MSFT), Amazon.com, Inc. (AMZN) and Berkshire Hathaway Inc. (BRK.B). 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 >>>

Microsoft’s shares have outperformed the Zacks Computer - Software industry over the past year (+59.2% vs. +52.8%). The company’s second-quarter results gained from strong Intelligent Cloud, and Productivity and Business Processes revenues. Productivity and Business Processes rose due to a strong adoption of Office 365 Commercial solutions. Microsoft 365 Consumer subscribers grew to 78.4 million.

Continued momentum in the small and medium businesses, frontline worker offerings and a gain in revenue per user drove the top line. Intelligent Cloud revenues were driven by growth in Azure and other cloud services. Solid adoption of Azure AI, which now has a clientele of more than 53,000 customers, holds promise.

However, Office's declining commercial licensing has been a headwind due to the continued customer shift to cloud offerings. Higher operating expenses and spending on Azure enhancements amid stiff competition in the cloud space remains a concern.

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

Shares of Amazon.com have outperformed the Zacks Internet - Commerce industry over the past year (+75.9% vs. +47.6%). Strengthening AWS services portfolio and its growing adoption rate contributed well to AWS performance. Ultrafast delivery services and an expanding content portfolio were beneficial. Strengthening relationships with third-party sellers was also a positive.

A robust advertising business contributed well. Notably, improving Alexa skills, along with an array of smart home products offerings remain tailwinds. Amazon’s strong global presence and solid momentum among the small and medium businesses are positives, as well.

Growing capabilities in grocery, pharmacy, healthcare and autonomous driving are additional successes for Amazon. Also, a deepening focus on generative AI is a major plus. However, macroeconomic challenges are among its concerns.

(You can read the full research report on Amazon.com here >>>)

Berkshire Hathaway’s shares have outperformed the Zacks Insurance - Property and Casualty industry over the past year (+35.0% vs. +29.5%). The company is one of the largest property and casualty insurance companies, with numerous diverse business activities. A strong cash position supports earnings-accretive bolt-on buyouts, and is indicative of its financial flexibility.

Continued insurance business growth fuels an increase in its float, driving earnings and generating maximum returns on equity. The non-insurance businesses have also been doing well in the last few years. The addition of Pilot Travel Centers (PTC) has strengthened its energy business. A sturdy capital level provides further impetus.

However, exposure to catatrophic losses induces earnings volatility and also affects underwriting results. Huge capital expenditures remain a headwind. With the demise of Charles Munger, uncertainty looms over the company's performance.

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

Other noteworthy reports we are featuring today include Abbott Laboratories (ABT), Sanofi (SNY) and BlackRock, Inc. (BLK).

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>>>