Today's Must Read
Berkshire Hathaway's (BRK.B) Buyouts Impress; Expenses Hurt
Consumer Direct Offense Plan to Fuel Growth at Nike (NKE)
Tuesday June 27 2017
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 Alphabet Inc (GOOGL), Berkshire Hathaway Inc. (BRK.B) and Nike Inc (NKE).These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Strong Buy rated Alphabet shares have outperformed the Zacks Internet-Services over the last one year period (the stock is up +39.2% vs. +29.2% gain for the sector) on the back of innovation and strategic acquisitions, while Android OS should continue to generate strong cash flows. Its diversification strategy is also positive, but requires significant investment and involves uncertain payback periods, particularly since these efforts are at the cutting edge of technology. Alphabet has shown good execution to date, more or less maintaining its dominant share in a competitive, fast-growing search market.
Berkshire Hathaway’s shares have gained +0.4% quarter to date, underperforming the categorized Property and Casualty industry which increased +1.6% during the same period. Berkshire Hathaway’s exposure to catastrophe losses, Buffett’s succession and huge capital expenses on account of its railroad operations remain headwinds. However, Berkshire Hathaway’s inorganic story remains impressive with strategic acquisitions. A sturdy capital level adds to the overall strength as well. Capital expenditure for 2017 is estimated to be $6.5 billion in 2017.
Shares of Nike fell -0.4% over the last one year period, underperforming the categorized Shoes and Retail Apparel industry. The company’s top-line fell prey to stiff competition and a tough retail backdrop in the last reported quarter. Meanwhile, to counter consumer shift toward online shopping, Nike unveiled a new company alignment – the Consumer Direct Offense. Driven by its Triple Double strategy, this restructuring plan focuses on using digital methods for rapid innovation and product development, along with strengthening consumer relations by operating through core regions. These regions include 12 key cities which are expected to account for over 80% of Nike’s previously forecasted growth, till 2020.
Other noteworthy reports we are featuring today include McDonald's Corporation (MCD), E I Du Pont De Nemours And Co (DD) and GlaxoSmithKline plc (GSK).
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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>>>