Today's Must Read
Average Daily Volume Growth Boosts UPS, High Costs Hurt
Solid Demand to Aid 3M (MMM) Amid Raw Material Costs Woes
Thursday, April 29, 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 Amazon.com (AMZN), United Parcel Service (UPS), and 3M Company (MMM). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Shares of Amazon have modestly lagged the broader market in the last one-year period (+40.8% vs. +46.5%). The Zacks analyst believes that Amazon is gaining from a solid Prime momentum owing to ultrafast delivery services and expanding content portfolio, as confirmed by the company's blockbuster March-quarter results Thursday afternoon.
Further, coronavirus-led spike in online orders continues to be a major tailwind. Also, solid growth in its online stores sales remains a positive. Moreover, surge in online grocery shopping is another positive.
Moreover, expanding AWS services portfolio is continuously helping Amazon in gaining further momentum among the customers. However, accelerating coronavirus related expenses remain risks for the company’s margin expansion in the near term. Also, rising cloud competition poses risk.
United Parcel Service shares have gained +28.5% over the last three months against the Zacks Transportation - Air Freight and Cargo industry’s gain of +24.5%. The Zacks analyst believes that an exponential e-commerce growth has been aiding UPS amid the ongoing pandemic.
The company performed very well in the first-quarter 2021, reporting better-than-expected earnings per share and revenues. The results were aided by an expanded volume of deliveries. Further, strong free cash flow generation is another positive for the company.
However, high operating expenses pose concerns. Moreover, management's decision to not provide any earnings and revenue guidance for 2021 sheds light on the uncertainty ahead.
Shares of 3M have gained +23.4% in the past six months against the Zacks Diversified Operations industry’s gain of +30.9%. The Zacks analyst believes that 3M is well-positioned to benefit from its solid product portfolio, marketing activities, as well as shareholder-friendly policies.
In first-quarter 2021, the company’s earnings and sales surpassed estimates by 23.11% and 5.92%, respectively. Further, increased demand for respirators boosted sales by $190 million during the quarter.
However, inflation in raw materials and logistic costs are predicted to hurt earnings in the quarters ahead. Also, debt-related woes, international exposure and restructuring charges are other major concerns for the company.
Other noteworthy reports we are featuring today include Texas Instruments (TXN), Costco Wholesale (COST) and Advanced Micro Devices (AMD).
These Stocks Are Poised to Soar Past the Pandemic
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Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
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>>>