Thursday, February 29, 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 Costco Wholesale Corp. (COST), The Walt Disney Co. (DIS) and AstraZeneca PLC (AZN). 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 >>>

Costco’s shares have outperformed the Zacks Retail - Discount Stores industry over the past year (+60.9% vs. +30.8%). A consumer defensive stock, Costco has been surviving the market turmoil pretty well.

The discount retailer’s key strengths are strategic investments, a customer-centric approach, merchandise initiatives and an emphasis on membership growth. These factors have been helping it register decent sales and earnings numbers.

This outlook reflects Costco’s ability to navigate the challenging operating environment, generate solid sales and register high membership renewal rates. A favorable product mix, steady store traffic, pricing power and strong liquidity position should help Costco keep outperforming. While trading at a premium to its peers, its long-term growth prospects should help the stock see solid upside.

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

Shares of Walt Disney have outperformed the Zacks Media Conglomerates industry over the past year (+12.8% vs. +1.2%). The company’s first-quarter fiscal 2024 results reflect a solid revival in international theme park and resort businesses. Recent attractions like the Frozen theme land at Hong Kong Disneyland and Walt Disney Park in Paris, as well as the Zootopia theme land at Shanghai Disney, are expected to boost the prospects of the theme park business.

Disney’s declining ad revenues, due to fewer impressions, has been a headwind for some time now. Disney+’s profitability is expected to be negatively impacted by higher investments in content, which will increase programming and production costs at Media and Entertainment Distribution.

Its leveraged balance sheet remains a concern. Disney+ is facing tough competition in the streaming market from the likes of Netflix and Amazon Prime Video.

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

AstraZeneca shares of have gained +2.4% over the past year against the Zacks Large Cap Pharmaceuticals industry’s gain of +35.3%. The company’s key drugs like Lynparza, Tagrisso, Imfinzi, Fasenra and Farxiga should keep driving revenues.  

AstraZeneca has also been engaged in external acquisitions and strategic collaborations to boost its pipeline, while investing in geographic areas of high growth like emerging markets. Backed by its new products and pipeline drugs, AstraZeneca believes it can post industry-leading top-line growth in the 2025-2030 period.

However, AstraZeneca’s diabetes franchise faces stiff competition, while pricing pressure hurts sales in the respiratory unit. Sales have slowed down in its key market, China. Estimates have gone up slightly ahead of the Q4 earnings release. The company has a positive record of earnings surprises in the recent quarters.

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

Other noteworthy reports we are featuring today include O'Reilly Automotive, Inc. (ORLY), Restaurant Brands International Inc. (QSR) and Arch Capital Group Ltd. (ACGL).

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>>>