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Research Daily

Sheraz Mian

Top Analyst Reports for Accenture, SAP & The Estee Lauder


Trades from $3

Monday, June 6, 2022

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 Accenture plc (ACN), SAP SE (SAP), and The Estée Lauder Companies Inc. (EL). 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 >>>

Accenture shares have gained +9.3% over the past year, roughly in-line with the Zacks Consulting Services industry’s gain of +10.2%, but magnitude better than the broader market's -3.7% decline. The Zacks analyst believes that the company has been steadily gaining traction in its outsourcing and consulting businesses. The company has been strategically enhancing its cloud and digital marketing suite through buyouts and partnerships. The company’s strong operating cash flow has helped it reward its shareholders in the form of dividend payments and share repurchases, and pursue opportunities in areas that show true potential.

However, On the flip side, pricing pressure due to significant competition from strong companies like Genpact, Cognizant and Infosys, remains a concern. Global presence exposes it to foreign currency exchange rate fluctuations. Buyout-related integration risks continues to remain a concern.

(You can read the full research report on Accenture here >>>)

SAP shares have declined -26.4% over the year-to-date basis against the Zacks Computer - Software industry’s decline of -21.2%. The Zacks analyst believes that the company’s weak uptake of software licenses and support offerings remains a headwind. Stiff competition and increasing costs to enhance cloud-based offerings is likely to exert pressure on the company’s profitability at least in the near term.

Though suspension of Russian operations amid the ongoing Ukraine war is expected to affect both revenues and non-IFRS operating profit, the company reiterated its outlook for 2022. Nevertheless, the company’s performance is gaining from strength in its cloud business, especially the new Rise with SAP solution. Momentum in SAP’s Business Process Intelligence platform, particularly the S/4HANA solutions along with steady traction witnessed in SuccessFactors Employee Central, Ariba and Fieldglass, Qualtrics and other cloud-based offerings is noteworthy.

(You can read the full research report on SAP here >>>)

The Estée Lauder shares have outperformed the Zacks Cosmetics industry over the past two years (+31.0% vs. -10.2%). The Zacks analyst believes that the company is benefiting from its growing Skin Care portfolio. The company’s strong presence in emerging markets has also been a driver. Further, it has a robust online business and the company expects it to be a major growth engine for the upcoming few years. These upsides were visible in the company’s third-quarter fiscal 2022 results, wherein the top and the bottom line rose year over year.

However, the company is battling pandemic-induced restrictions in the Asia/Pacific region. During the third quarter, organic sales fell in mid-single-digits in Mainland China, as a sharp decline in brick-and-mortar sales offset online growth. The company revised its fiscal 2022 outlook downward owing to the added headwinds affecting the fiscal fourth-quarter view.

(You can read the full research report on The Estee Lauder here >>>)

Other noteworthy reports we are featuring today include CME Group Inc. (CME), ABB Ltd (ABB), and Aon plc (AON).
Sheraz Mian
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>>>

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