Today's Must Read
Visa (V) Rides on Visa Europe Buy, Strong Balance Sheet
Postpaid Mobile Customer Gains, Upcoming 5G Lifts Verizon (VZ)
Thursday, January 25, 2018
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 Wells Fargo (WFC), Visa (V) and Verizon (VZ). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Wells Fargo’s shares have outperformed the Zacks Major Banks industry in the last three months. Further, the company has an impressive earnings surprise history. The company has surpassed expectations for earnings in two out of the trailing four quarters. Wells Fargo’s fourth-quarter 2017 adjusted earnings improved from the prior-year quarter. Notably, results recorded tax benefit related to the Tax Cuts & Jobs Act.
Further, higher non-interest income, partially offset by lower net interest income and elevated expenses, were experienced. Wells Fargo plans $4 billion of cost cuts by 2019. While the current crisis related to the revelation of illegally opening millions of illegal accounts in 2016 at the company will take some time to alleviate, the Zacks analyst thinks consistent growth in loans and deposits, lower tax rate and expansions will likely support its growth profile.
Shares of Buy-rated Visa have outperformed the Zacks Financial Transaction Services industry over the last one year. Numerous strategic acquisitions and alliances, technology upgrades and effective marketing have paved the way for the company's long-term growth that have led to consistent revenue growth over the past several years.
The Zacks analyst thinks Visa is well poised to gain from the growing electronic payment processing and strong international business. A solid balance sheet ensures effective capital deployment.
Strong earnings guidance instills our confidence in the company. The stock has seen the Zacks Consensus Estimate for current-year earnings being revised 0.7% upward over the last 60 days.
Verizon’s shares have outperformed the Zacks Wireless National industry over the last six months. Verizon posted mixed fourth-quarter 2017 results with a massive gain of 1.174 million postpaid customers but lost 0.184 million prepaid customers.
Verizon plans to launch 5G wireless residential broadband services in several U.S. markets in 2018. Verizon is planning to launch a theme-based online streaming TV service in 2018, backed by the digital streaming deal with the National Football League (NFL). Verizon is targeting the SMB segment with Fios Current TV video services.
The company is boosting its fiber network assets with new buyouts. Verizon expects positive growth in 2018 on the back of the expected savings from tax reform. However, Verizon continues to struggle in a highly competitive and saturated wireless market. Losses in wireline access lines, marketing costs of promotional plans, competitive video market are other major risks.
Other noteworthy reports we are featuring today include State Street (STT), PNC Financial (PNC) and General Dynamics (GD).
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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>>>