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Research Daily

Thursday, October 24, 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, including Costco (COST), Booking Holdings (BKNG) and PNC Financial (PNC). 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 >>>

Costco’s shares have outperformed the Zacks Discount Retail industry year to date (46% vs. 42.8%). The Zacks analyst believes that growth strategies, increase in membership fees and impressive e-commerce sales bode well for the company. Costco continues to be one of the dominant retail wholesalers based on the breadth and quality of merchandise offered.

The stock has been gaining from sturdy comps and decent results. The company posted positive earnings and sales surprise in the fourth quarter of fiscal 2019. Notably, the top and the bottom line continued to register year-over-year improvement. Certainly, Costco seems somewhat unfazed by a tough retail scenario.

The company’s efforts have been driving traffic across online and brick-and-mortar platforms. However, any incremental investments or aggressive pricing strategy may hurt margins. Moreover, rising SG&A expenses and stiff competition also pose concerns.

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

Shares of Booking Holdings have gained 8.9% in the past six months against the Zacks Internet Commerce industry’s decline of 8.7%. The Zacks analyst believes that Booking Holdings is riding on improving gross bookings. The company continues to witness solid growth in the booked room nights.

Its rising mobile share and growing accommodation business are aiding total room nights’ bookings. Further, solid efforts toward ramping up of merchant business remain positive. We believe a secular growth trend in the online travel booking market and increasing mobile usage penetration are tailwinds.

Moreover, the company’s strong position in international markets, growth opportunities in the domestic market and good execution of marketing strategies are major positives. However, sluggishness in the rental car days poses risk. Moreover, macro headwinds, increasing advertising spend and occupancy tax-related litigation remain concerns. 

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

PNC Financial’s shares have gained 3.9% over the past three months against the Zacks Major Regional Banks industry’s rise of 4.3%. The Zacks analyst believes the company’s third-quarter results reflect robust organic growth, partially offset by higher expenses and provisions.

The company's commitment to expand middle market lending franchise and expand its digital products and services offerings bodes well. Moreover, execution of inorganic strategies in order to diversify revenue sources is likely to continue bolstering fee income.

However, with growing business and investment in technology, its expense base is expected to keep rising. Also, lack of diversification in loan portfolio is a headwind.

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

Other noteworthy reports we are featuring today include Boeing (BA), The Southern Company (SO) and General Dynamics (GD).

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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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