Today's Must Read
Acquisitions, Trading Focus Aid Schwab (SCHW) Amid Low Rates
Expanding Clientele, Remote-Working Solutions Aids Zoom (ZM)
Thursday, August 5, 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 Medtronic plc (MDT), The Charles Schwab Corporation (SCHW), and Zoom Video Communications, Inc. (ZM). 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 >>>
Shares of Medtronic have outperformed the Zacks Medical Products industry over the past year (+35.5% vs. +12.4%). The Zacks analyst believes that all of the company’s major business groups have been contributing to consistent revenue growth at CER, which also highlights sustainability across groups and regions.
The gross and operating margins showed stupendous improvement in the fourth quarter of fiscal 2021. The results reflected a strong recovery from the impact of the pandemic on elective procedures that the company experienced in April 2020. The company’s performance, however, continues to be impacted by deferred procedures due to the pandemic, especially in the emerging markets.
Schwab shares have gained +24.8% over the last six months against the Zacks Investment Brokers industry’s gain of +20.8%. The Zacks analyst believes that strategic buyouts have reinforced its position as a leading brokerage player, which will likely be accretive to earnings, also leading to cost savings.
The company has witnessed a rise in client assets and brokerage accounts on the back of commission-free trading that it offers. This is expected to continue improving its trading revenues. Near-zero interest rates and no chance of a hike in the same in the near term pose a major concern. Continuously increasing operating expenses are also likely to hurt profitability.
Shares of Zoom Video have gained +35.6% in the past three months against the Zacks Internet Software industry’s gain of +14.6%. The Zacks analyst believes that Zoom has been benefiting from solid demand for the company’s cloud-native video-first platform on the back of work-from-home and online-learning wave.
Its top-line is expected to benefit from its continuously expanding clientele. The company’s efforts to eliminate the security and privacy loopholes, as well as the launch of new hardware and Zoom From Home solution, are other major positives. Intense competition, however, from the likes of Microsoft and Cisco in the video-communication space remains a concern.
Other noteworthy reports we are featuring today include Micron Technology, Inc. (MU), Norfolk Southern Corporation (NSC) and General Dynamics Corporation (GD).
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>>>