Today's Must Read
Restructuring Plans to Aid Wells Fargo (WFC) Amid Low Rates
Order Growth Boosts Lockheed (LMT), Tiff With Turkey Ails
Friday, March 19, 2021
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 PayPal Holdings (PYPL), Wells Fargo (WFC), and Lockheed Martin (LMT). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
PayPal shares have been under pressure lately as interest rates have moved up, but they have outperformed the Zacks Internet Software industry over the past year (+178% vs. +137.8%). The Zacks analyst believes that PayPal is benefiting from robust growth in total payments volume owing to increasing net new active accounts.
Further, strengthening customer engagement on the company’s platform is a major positive. Furthermore, Venmo’s improving monetization efforts and rising adoption rate across various platforms are aiding the total active accounts growth. Additionally, solid momentum of core peer to peer and PayPal Checkout experiences is a tailwind.
Also, well-performing merchant services are a positive. However, increasing credit loss reserves owing to macroeconomic projections on account of coronavirus is a serious matter of concern.
Wells Fargo shares have gained +65.3% over the last six months against the Zacks Major Regional Banks industry’s gain of +62.4%, as the interest rate backdrop has finally become favorable for the group. The Zacks analyst finds the company's efforts to enhance compliance and risk-management capability, along with streamlining initiatives, encouraging.
Also, strong deposits balance depicts robust liquidity position. The company carries less credit risk in case of any economic downturn. Declining expenses due to its cost savings efforts might support bottom-line growth to an extent.
However, Wells Fargo's revenues remain under pressure due to low rates and volatile fee income trend. Also, legal hassles pose a concern. Further, restrictions on asset growth placed by Federal reserve, has taken a toll on the company's loan growth ability.
Shares of Lockheed Martin have gained +0.6% in the past three months against the Zacks Aerospace Defense industry’s gain of +10.9%. The Zacks analyst believes that expansionary U.S. budgetary provisions will immensely boost this defense prime’s business.
Its F-35 program continues to be a key growth driver for the company’s Aeronautics business segment, having added 120 aircraft in 2020. It has a stable liquidity position. However, forced cost reduction initiatives for F-35 program might hamper its operating results.
America and Turkey's tiff on the latter accepting Russian products may hurt Lockheed's component supply from Turkey. Moreover, the company is facing performance issues in relation to some of its products, which in turn may hurt its results.
Other noteworthy reports we are featuring today include Intuit (INTU), ConocoPhillips (COP) and Equinix (EQIX).
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Zacks’ has just revealed 3 companies that can help investors capitalize on the explosive profit potential of Bitcoin and the other cryptocurrencies with significantly less volatility than buying them directly.
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>>>