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Research Daily

Mark Vickery

Top Stock Reports for Costco Wholesale, Intuit & Schlumberger


Trades from $3

Friday, January 27, 2023

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 Costco Wholesale Corp. (COST), Intuit Inc. (INTU) and Schlumberger Ltd. (SLB). 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 Costco Wholesale have gained +1.2% over the past year against the Zacks Retail - Discount Stores industry’s gain of +3.1%. The company, being a consumer defensive stock, has been surviving market turmoil pretty well. The discount retailer’s key strengths are strategic investments, a customer-centric approach, merchandise initiatives, and an emphasis on membership growth.

These factors have been helping it register impressive sales and earnings numbers. The Zacks analyst expects the company to register a 3.8% adjusted earnings per share improvement in fiscal 2023 on 6.6% revenue growth.

This outlook accounts for the businesses’ ability to navigate the ongoing inflationary environment and supply chain bottlenecks on several fronts. A favorable product mix, steady store traffic, pricing power and strong liquidity position should help Costco keep outperforming. While trading at a premium to its peers, its long-term growth prospects should help the stock see a solid upside.

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

Intuit's shares have underperformed the Zacks Computer - Software industry over the past year (-22.8% vs. -17.4%). The company is witnessing macroeconomic and geopolitical headwinds might significantly hurt small businesses operations, thereby posing risks for Intuit’s top-line growth. Additionally, higher costs and expenses due to increased investments in marketing and engineering teams are likely to continue impacting bottom-line results in the near term.

Nevertheless, Intuit is benefiting from strong momentum in online ecosystem revenues and solid professional tax revenues. The TurboTax Live offering is also driving growth in the Consumer tax business. Solid momentum in the company’s lending product, QuickBooks Capital, remains a positive.

Moreover, the company’s strategy of shifting its business to cloud-based subscription model will help generate stable revenues over the long run. The Zacks analyst expects Intuit’s revenues to grow at a CAGR of 11.9% through fiscal 2023-2025.

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

Schlumberger’s shares have outperformed the Zacks Oil and Gas - Field Services industry over the past year (+44.9% vs. +36.4%). The company is the largest oilfield services player, with a presence in every energy market across the globe. Being the leading provider of technology for complex oilfields, the firm is well-poised to take up new offshore projects in international markets.

Higher oil prices is aiding its overall business. SLB reported strong fourth-quarter results driven by strong activities in land and offshore resources in North America and Latin America. It made significant progress in its sustainability initiatives in 2022. SLB expects its Transition Technologies portfolio to cross the $1 billion revenue mark in 2023.  

However, the company’s balance sheet has massive debt exposure compared with the composite stocks in the industry. 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 Schlumberger here >>>)

Other noteworthy reports we are featuring today include Aflac Inc. (AFL), Alcon Inc. (ALC) and W.W. Grainger, Inc. (GWW).

Mark Vickery
Senior Editor

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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