Today's Must Read
Verizon (VZ) Rides on 5G, Mobile Video & Online Content Boom
Accenture (ACN) Continues to Benefit From Acquisitions
Monday, December 9, 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 Berkshire Hathaway (BRK.B), Verizon Communications (VZ) and Accenture (ACN). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Berkshire Hathaway’s shares have underperformed the Zacks Insurance - Property and Casualty industry year to date (9.1% vs. 10.6%). The Zacks analyst believes that the company’s strong cash position supports earnings-accretive bolt-on buyouts. Continued insurance business growth also fuels increase in float.
Berkshire Hathaway’s third-quarter 2019 earnings of $3.21 per share beat the Zacks Consensus Estimate by 15.5% and improved 15.1% year over year on the back of better performance across all its segments. It boasts to be one of the largest property and casualty insurance company measured by premium volume. Its inorganic growth story remains impressive with strategic acquisitions.
Its non-insurance businesses are delivering improved results. A sturdy capital level provides further impetus. However, exposure to catastrophe loss remains a concern. Huge capital expenses due to railroad operations pose concern.
Shares of Verizon have gained 2.5% in the past three months against the Zacks Wireless National industry’s rise of 1%. The Zacks analyst believes that with industry-leading wireless products and services, the company remains well poised to benefit from increased 5G deployment across the country under the new operational framework.
Focus on online content delivery, mobile video and online advertising will also likely drive future growth. The company has upped the ante against rivals by launching 5G Ultra Wideband network in select locations of the country and reiterated its guidance. However, it continues to struggle in a competitive U.S. wireless market.
The company's wireline division is struggling with losses in access lines due to competitive pressure from VoIP service providers. In addition, Verizon is spending heavily on promotion and lucrative discounts to woo customers, which contracts margins.
Accenture's shares have gained 9.9% over the past six months against the Zacks Consulting industry's rise of 9%. The Zacks analyst believes that Accenture has been steadily gaining traction in its outsourcing and consulting businesses.
The company has been strategically enhancing its cloud and digital marketing suite through acquisitions and partnerships. The company’s strong operating cash flow has helped it reward its shareholders in the form of dividends and share repurchases, and pursue opportunities in areas that show true potential.
Accenture is currently a global leader in the Salesforce implementation service space. Due to these positives, shares of Accenture have outperformed its industry in the past year.
However, Accenture continues to face pricing pressure due to significant competition from strong companies like Genpact, Cognizant and Infosys. Global presence exposes Accenture to foreign currency exchange rate fluctuations. Buyout-related integration risks is a concern.
Other noteworthy reports we are featuring today include Bristol-Myers Squibb (BMY), General Electric (GE) and American Tower (AMT).
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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>>>