Today's Must Read
Subscriber Gain, Wireless Initiatives Benefit Charter (CHTR)
Abbott (ABT) to Boost Dull Vascular Arm with Xience Sierra
Friday, May 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 Duke Energy (DUK), Charter Communications (CHTR) and Abbott (ABT). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Duke Energy's shares have underperformed the Zacks Electric Power industry in the last year, declining -11% vs -5.7%. Duke Energy kick-started 2018 on a solid note, with its first quarter earnings as well as revenues having surpassed their respective expectations.
Year-over-year also results were impressive. The company currently boasts a robust five-year capital plan and plans to invest about $48.2 billion in growth projects over the 2018-2022 time frame. The Zacks analyst also likes the company’s efforts to expand its renewable base.
However, Duke Energy faces challenges from severe weather conditions and natural calamities like hurricanes, which may result in breakdown and damage to its infrastructure. Moreover, the company expects to incur environmental compliance costs of $3.4 billion for the 2018-2022 time frame.
Shares of Charter Communications have underperformed the Zacks Cable TV industry over the past three months (-25% vs. -19.1%). Charter’s first-quarter 2018 results benefited from subscriber growth in residential and commercial internet and voice segment. The partnership with Comcast to develop back-end software to support services for Xfinity and Spectrum mobile offerings is significantly positive for the company’s growth prospects. The collaboration will help in saving costs.
However, Charter continues to struggle due to a saturated and competitive multi-channel U.S. video market. The company also faces stiff competition from online TV streaming service providers. The Zacks analyst also thinks that the company's high debt level and consolidation-related woes are major headwinds.
Abbott’s shares have gained +11.3% over the last six months, outperforming the Zacks Medical Products industry, which has gained +7.4% over the same period. The Zacks analyst likes the strong and consistent performance by the company’s EPD and Medical Devices segments.
Also, solid contributions from Diagnostics and Nutrition business are encouraging. The company’s receipt of FDA approval for XIENCE Sierra coronary stent system will help it to revive the dull Vascular business. Within Structural Heart, strong uptake of MitraClip therapy post the national reimbursement approval in Japan also encourages us. Abbott’s Alere buyout is another positive. Synergies from this consolidation in the form of revenues from Rapid Diagnostics have been driving the company’s growth.
Meanwhile, the company’s emerging market performance has been extremely promising on several strategic developments. On the flip side, sluggish Vascular business in the United States continues to dent growth.
Other noteworthy reports we are featuring today include UnitedHealth (UNH), T. Rowe Price (TROW) and Brown-Forman (BF.B).
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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>>>