Today's Must Read
Global Business Aids Thermo Fisher (TMO) Amid Forex Woes
5G Network Strength to Drive T-Mobile (TMUS) Amid Competition
Monday, April 12, 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 Berkshire Hathaway (BRK.B), Thermo Fisher Scientific (TMO), and T-Mobile US (TMUS). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Shares of Berkshire Hathaway have outperformed the Zacks Insurance - Property and Casualty industry over the past year (+41.7% vs. +30.5%). The Zacks analyst believes that continued insurance business growth fuels increase in float, drive earnings and generates maximum return on equity.
Berkshire's inorganic growth story remains impressive with strategic acquisitions. A strong cash position supports earnings-accretive bolt-on buyouts and indicates the company's financial flexibility. The non-insurance businesses are delivering improved results with increased revenues over the past few years.
A sturdy capital level provides further impetus. However, exposure to catastrophe loss induces earnings volatility and also affects the property and casualty underwriting results of Berkshire. Huge capital expenditure remains a headwind for the company.
Thermo Fisher’s shares have gained +2% over the last six months against the Zacks Medical Instruments industry’s loss of -1%. The Zacks analyst believes that several takeovers including Advanced Bioprocessing buyout from BD and Patheon have helped Thermo Fisher expand its inorganic growth profile.
In terms of end market, pharma and biotech registered growth on robust performance in bioproduction and pharma services in the fourth quarter of 2020. In diagnostics and healthcare, the company experienced exceptionally high demand for COVID-19 testing.
A strong capital structure looks encouraging. However, the coronavirus outbreak has massively disrupted the global supply chain. Foreign currency fluctuations and competitive landscape are major downsides.
Shares of T-Mobile have gained +1.3% in the past three months against the Zacks National Wireless industry’s gain of +2.6%. The Zacks analyst believes that T-Mobile operates in a fiercely competitive and almost saturated U.S. telecom market. Also, several promotional activities to lure customers from rivals hurt its profitability.
However, the wireless carrier is confident of its ability to build the largest and fastest 5G network in the United States. Its Extended Range 5G covers 287 million people across 1.6 million square miles. It also covers 125 million people with Ultra Capacity 5G and is on track to reach 200 million by the end of 2021.
T-Mobile is considered the leader with the most Android smartphone customers in the country. It is expanding its Home Internet pilot extensively while preparing to launch the 5G Home Internet service.
Other noteworthy reports we are featuring today include Medtronic (MDT), Philip Morris International (PM) and Square (SQ).
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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>>>