Monday, December 19, 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 Berkshire Hathaway Inc. (BR.B), Exxon Mobil Corporation (XOM) and Pfizer Inc. (PFE). 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 Berkshire Hathaway have gained +3.6% over the past year against the Zacks Insurance - Property and Casualty industry’s gain of +5.2%. The company is one of the largest property and casualty insurance companies measured by premium volume. Berkshire's inorganic growth story remains impressive with strategic acquisitions. A strong cash position supports earnings-accretive bolt-on buyouts and indicates the company's financial flexibility.

Continued insurance business growth fuels increase in float, drive earnings and generates maximum return on equity. The non-insurance businesses are delivering improved results with increased revenues over the past few years. A sturdy capital level provides further impetus.

However, exposure to catastrophe loss induces earnings volatility and also affects the property and casualty underwriting results of Berkshire. Huge capital expenditure remains a headwind for the company.

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

Exxon Mobil shares have outperformed the Zacks Oil and Gas - Integrated - International industry over the past year (+77.0% vs. +46.8%). The company’s bellwether status and an optimal integrated capital structure that has historically produced industry-leading returns make it a relatively lower-risk energy sector play. The company has made more than 30 discoveries in offshore Guyana since 2015.

ExxonMobil also has a strong presence in the prolific Permian Basin, where it expects to boost production volumes by 25% in 2022. The energy major has significantly lower debt exposure than composite players belonging to the industry. Also, XOM announced a fourth-quarter dividend of 91 cents per share, indicating an increase of 3.4% from the last paid dividend.

However, ExxonMobil has been constantly bearing the brunt of increasing expenses, adversely affecting the income. Also, the aggressive capital budget remains a headwind for the company. As such, the stock warrants a cautious stance.

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

Shares of Pfizer have underperformed the Zacks Large Cap Pharmaceuticals industry over the past year (-15.8% vs. +13.6%). The company is facing currency headwinds and pricing pressure that are key top-line headwinds. Although no company is as strongly placed in the COVID vaccines/treatment market as Pfizer, concerns remain about its long-term growth drivers beyond its COVID-related products due to competitive pressure and the impact of the pandemic receding.

Nevertheless, Pfizer boasts a diversified portfolio of innovative drugs and vaccines, including Ibrance and Prevnar. Its COVID-19 vaccine has become a key contributor to the top line. The vaccine, together with its promising oral antiviral pill for COVID-19, Paxlovid, is expected to generate a combined $56 billion in sales in 2022. Pfizer boasts a sustainable pipeline with multiple late-stage programs that can drive growth.

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

Other noteworthy reports we are featuring today include Abbott Laboratories (ABT), The Charles Schwab Corporation (SCHW) and ABB Ltd (ABB).

Director of Research

Sheraz Mian

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>>>