Today's Must Read
End-Market Strength, APAC Sales Aid Thermo Fisher (TMO)
Portfolio Strength Benefits PayPal (PYPL) Amid Competition
Friday, November 29, 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 Procter & Gamble (PG), Thermo Fisher (TMO) and PayPal (PYPL). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Procter & Gamble’s shares have outperformed the Zacks Soap and Cleaning Materials industry year to date (+30.9% vs. +20.9%). The Zacks analyst believes that Strong organic sales growth, backed by higher shipment volume and favorable price/mix, boosted the company’s top line.
The company’s solid first-quarter fiscal 2020 results, wherein both top and bottom lines not only surpassed the Zacks Consensus Estimate but also improved year over year, is driving the stock momentum. Again, ongoing cost-saving and productivity efforts cushioned margins and in turn the bottom line.
Impressive performance prompted management to provide an upbeat view for fiscal 2020. The company now projects all-in sales growth of 3-5% and core EPS growth of 5-10%. On the flip side, currency fluctuation remains concerning. Nevertheless, adverse impacts of the same are likely to be offset by slight gain from acquisitions and divestitures.
Shares of Thermo Fisher have gained 7.5% in the past three months against the Zacks Medical Instruments industry’s rise of 7.2%. The Zacks analyst is looking forward to the company’s recent purchases of Brammer Bio in the field of Gene and Cell Therapy and an active pharmaceutical ingredient manufacturing facility from GlaxoSmithKline.
Thermo Fisher ended the third quarter of 2019 with better-than-expected numbers. Barring industrial and applied, the company saw strength in all three end markets too. Further, the company registered solid international performance with strong growth in Europe and Asia-Pacific including China. Also, a series of product launches with progress in precision medicine initiatives aided the company’s performance.
On the flip side, Thermo Fisher’s operating segments are getting impacted by unfavorable business mix. Competitive headwinds and escalating costs pose threat.
PayPal's shares have lost 6.8% over the past six months against the Zacks Internet Software industry's fall of 4.1%. The Zacks analyst believes that PayPal is driven by growth in total payments volume owing to Venmo and One Touch.
Also, increasing net new active accounts and strengthening customer engagement on the company’s platform are positives. Additionally, growing momentum of the company’s core peer to peer and merchant services remains positive.
However, declining eBay volume remains a headwind for the company’s total payment volume. Sale of the U.S. consumer credit receivables portfolio to Synchrony are risks to PayPal's top-line growth. Also, increasing competition from Square remains a major concern.
Other noteworthy reports we are featuring today include NextEra Energy (NEE), Petrobras (PBR) and Enterprise Products (EPD).
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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>>>