Today's Must Read
3M (MMM) Buoyed by Healthy Growth Dynamics Across Segments
Postpaid Wireless Subscriber Addition Boosts T-Mobile (TMUS)
Wednesday, October 25, 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 Lockheed Martin (LMT), 3M (MMM) and T-Mobile (TMUS). 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 >>>
Lockheed Martin’s shares have gained +25.2% over the past year, underperforming the Zacks Aerospace Defense sector, which has gained +46.7% over the same period. Lockheed Martin's third-quarter 2017 earnings and revenues missed expectations. However, year-over-year results were impressive.
Being the largest defense contractor in the world, Lockheed Martin witnesses strong demand for its high-end military equipments in both domestic as well as overseas markets. The latest $3.8 billion deal signed with the Bahrain government is expected to strongly boost its growth.
However, the F-35 program, despite being a prime defense project for the U.S. government, has been facing criticism for being overtly expensive, for past few years. Moreover, the company's limited commercial exposure and almost full government dependency may prove fatal in maintaining its margins and bottom line.
Shares of Buy-rated 3M have gained +31.4% year to date, outperforming the Zacks Diversified Operations industry, which has declined -0.7% over the same period. Driven by broad-based organic growth across all segments and geographies, 3M reported strong third-quarter 2017 results with healthy year-over-year increase in earnings and revenues that beat expectations.
The Zacks analyst likes 3M's global footprint, diversified product portfolio and ability to penetrate different markets. The company is continuing with its portfolio restructuring efforts by divesting assets that are no longer a strategic fit and continues to make investments in other lucrative markets.
3M is standardizing its business processes through a new global ERP system for significant operational savings and has raised its guidance for 2017 on healthy growth dynamics. However, given its international presence, adverse foreign currency translations are likely to affect 3M’s ability to realize projected growth rates in sales and earnings.
(You can read the full research report on 3M here >>>).
T-Mobile’s shares have been strong performers lately -- the stock is up +25.9% over the last 12 months, handily outperforming the Zacks National Wireless industry (stagnant with 0% growth) and the broader Zacks Telecommunications Services industry (up +1.8%). T-Mobile US posted strong third-quarter 2017 financial results, with 1.329 million net customer additions.
The Zacks analyst thinks T-Mobile US' network expansion and improvement plans, deployment of LTE-U technology and attractive unlimited data plans have driven customer additions. T-Mobile US is making its unlimited postpaid wireless service, T-Mobile ONE, more attractive with the inclusion of services from online video streaming service provider, Netflix Inc.
The company has decided to roll out 600 MHz wireless spectrum in its footprints and has conducted successful Narrowband Internet of Things (NB-IoT) tests live on its commercial network. However, competitive and saturated wireless market and marketing costs of the low-priced promotional plans are major headwinds. Also, it faces increased scrutiny in its working conditions by regulatory authorities.
Other noteworthy reports we are featuring today include Broadcom (AVGO), Roche (RHHBY) and Intuitive Surgical (ISRG).
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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>>>