Today's Must Read
Strong Exposure to Robotics Aids Intuitive Surgical (ISRG)
Colgate's (CL) Cost-Savings Program is Likely to Aid Margins
Thursday, January 10, 2019
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, Morgan Stanley (MS), Intuitive Surgical, Inc. (ISRG) and Colgate-Palmolive Company (CL). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Morgan Stanley’s shares have lost 12.6% in the last six months, outperforming the Zacks Investment Banking industry, which has lost 16.2% over the same period.The company possesses an impressive earnings surprise history, beating the Zacks Consensus Estimate in each of the trailing four quarters.
The company’s efforts to strengthen wealth management business, focus on corporate lending, steady loan growth, higher interest rates and normalized levels of trading activities will further support revenues. Also, its steady capital deployment plan reflects strong balance sheet position.
However, a slowdown in debt originations will hamper underwriting fee income growth. Further, mounting operating expenses is a major near-term concern for the company.
Shares of Buy-ranked Intuitive Surgical have gained +2.6% in the last six months, outperforming the Zacks Medical Instruments industry which has lost -4.9% over the same period. The company’s robotic platform – da Vinci System – recorded solid growth in recent times. This is led by strong performance in U.S. general surgery procedures and global urologic procedures. Management expects strong contributions from da Vinci in 2019 as well. Commencement of da Vinci sale in Taiwan also adds to the positives.
Management is also optimistic about the company’s collaboration with InTouch Health. On the negative side, the company expects outside U.S. sales to be a bit lumpy in the quarters ahead. These markets are in early stages of adoption.
Shares of Colgate-Palmolive have underperformed the Zacks Consumer Staples industry over the past three months (-1.7% vs. +8.1%). Colgate is smoothly progressing with its cost-savings program. Notably, the Global Growth and Efficiency Program and Funding the Growth initiative are delivering impressive results.
Management approved an expansion and extension of the program through Dec 31, 2019, which will enable it to take advantage of the incremental opportunities while streamlining operations. Further, the company’s meet or beat earnings long track record remains impressive.
It also provided a favorable earnings view for 2018. However, the stock has lagged the industry in the past three months. It has a dismal sales trend, missing estimates in 21 of the last 22 quarters. Management anticipates a tough backdrop due to uncertain global markets and slowing category growth worldwide.
Other noteworthy reports we are featuring today include Ecolab (ECL), Keurig Dr Pepper (KDP) and Prudential Financial (PRU).
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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>>>