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Research Daily

Sheraz Mian

Top Analyst Reports for Walmart, AstraZeneca & HSBC

XOM WMT TOT MO HSBC AZN

Trades from $3

Wednesday, November 18, 2020

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 Walmart (WMT), AstraZeneca (AZN) and HSBC Holdings (HSBC). 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 >>>

Walmart shares have modestly outperformed the Zacks Supermarkets industry in the year-to-date period (+27.2% vs. +23.9%), but the stock has handily beaten the broader market on the back strong momentum in its online business and rising demand for grocery and general merchandise amid the pandemic.

Stay-at-home trends are also boosting e-commerce sales, which soared 79% in the U.S. segment in third-quarter fiscal 2021. During the quarter, the top and bottom lines beat the estimates and grew year over year, with U.S. comp sales rising for the 25th straight time. Comps were fueled by strength in core categories and higher shift toward e-commerce.

Clearly, Walmart’s efforts to enhance deliveries are yielding results. Also, the company is focused on improving the International unit’s performance, evident from its recent plans to sell certain businesses. However, the company is seeing high COVID-19 costs, which are likely to prevail. Also, price investments are hurting gross margin to an extent. 

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

Shares of AstraZeneca have gained +15.2% over the past year against the Zacks Large Cap Pharmaceuticals industry’s rise of +5.4%. The Zacks analyst believes that AstraZeneca’s newer drugs, mainly cancer medicines Lynparza, Tagrisso and Imfinzi should keep driving revenues. Its pipeline is strong with several phase III data readouts lined up for the next few months including data on COVID-19 vaccine candidate, AZD1222.

AstraZeneca missed Q3 estimates for earnings but beat the same for sales. Its products like Nexium, Crestor and Seroquel are facing generic competition, which is hurting sales. The diabetes franchise also faces stiff competition while pricing pressure is hurting sales in the respiratory unit.

AstraZeneca has also engaged in external acquisitions and strategic collaborations to boost its pipeline while investing in geographic areas of high growth like China. Cost-cutting efforts should drive earnings.

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

HSBC shares have gained +2.9% over the past six months against the Zacks Foreign Banks industry’s rise of +38.5%. The Zacks analyst believes that the company’s initiatives to improve market share in the U.K. and China are likely to support financials over the long term.

However, these efforts might lead to a rise in costs in the near term, thus, hurting the bottom line. Moreover, global economic slowdown, low interest rate environment across the globe and weak loan demand will likely hamper revenue growth. The coronavirus-induced ambiguity is likely to continue to hurt financials to some extent in the near term.

Yet, the company’s strong capital position, initiatives to strengthen digital capabilities, extensive network across the world and efforts to improve operating efficiency through business restructuring are expected to support profits.

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

Other noteworthy reports we are featuring today include Exxon Mobil (XOM), TOTAL (TOT) and Altria Group (MO).

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Sheraz Mian

Director of Research                                                             

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>>>

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