Today's Must Read
Robust Portfolio, Services Strength to Benefit Apple (AAPL)
Chevron (CVX) to Gain from Massive Permian Acreage
Accenture (ACN) Gains From Service Demand Amid Talent Cost
Friday, May 26, 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 Apple Inc. (AAPL), Chevron Corp. (CVX) and Accenture plc (ACN). 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 >>>
Apple’s shares have outperformed the Zacks Computer - Mini computers industry over the past year (+16.3% vs. +15.8%). The company’s revenues are expected to grow year over year. Growing services subscriber base and a strong liquidity position are key catalysts for Apple’s prospects.
However, Apple expects the March quarter’s year-over-year revenue growth to be similar to that of the December quarter due to unfavorable forex. For iPhone, Apple expects the March quarter’s year-over-year revenue growth to accelerate relative to the December quarter’s year-over-year revenue growth.
For Mac and iPad, revenues are expected to decline in double digits on a year-over-year basis due to challenging comparison and macroeconomic headwinds. Services revenue growth is expected to be negatively impacted by challenging macroeconomic conditions, as well as weakness in digital advertising and gaming.
(You can read the full research report on Apple here >>>)
Shares of Chevron have underperformed the Zacks Oil and Gas - Integrated - International industry over the past year (-10.1% vs. +1.7%). The company was not immune to the commodity price crash of 2020, forcing it to cut spending substantially. The company’s high oil price sensitivity is a concern too.
Moreover, the supermajor’s 10-year reserve replacement ratio of 100% is indicative of its inability to replace the amount of energy produced. However, Chevron is considered one of the best-placed global integrated oil firms to achieve sustainable production ramp-up.
America’s No. 2 energy firm’s existing project pipeline is among the best in the industry, thanks to its premier position in the lucrative Permian Basin. As a reflection of these positives, we saw CVX’s EPS jump 132% in 2022.
(You can read the full research report on Chevron here >>>)
Accenture’s shares have outperformed the Zacks Consulting Services industry over the year-to-date period (+77.0% vs. +46.8%). The company has been steadily gaining traction in its outsourcing and consulting businesses backed by high demand for services that can improve operating efficiencies and save costs. 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. 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. Partly due to these headwinds, Accenture shares are down 4.1% in the past year.
(You can read the full research report on Accenture here >>>)
Other noteworthy reports we are featuring today include NVIDIA Corp. (NVDA), Broadcom Inc. (AVGO) and Stryker Corp. (SYK).
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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