Today's Must Read
ExxonMobil (XOM) Banks on Offshore Guyana, Refining Weak
Adobe (ADBE) Rides on Growing Adoption of Cloud Applications
Thursday, May 7, 2020
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), Exxon Mobil (XOM) and Adobe Systems (ADBE). 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 over the past year (+7.1% vs. -2.2%). The Zacks analyst believes that company’s efforts to make its cleaning and personal care products during the current pandemic have helped bolster sales. It has witnessed an increased demand for hand soaps, detergents and surface cleaning products, in particular.
The company’s solid third-quarter fiscal 2020 earnings mark the continuation of its positive surprise trend. Further, earnings and sales improved year over year in the reported quarter on gains from significant sales increase, related fixed cost leverage and ongoing productivity efforts.
Further, it delivered adjusted free cash flow productivity of 113% in the fiscal third quarter. However, currency fluctuations remain concerning. Due to stronger headwind from foreign exchange rates, the company lowered its all-in sales view for fiscal 2020.
Shares of Exxon Mobil have lost 36.8% over the past six months against the Zacks Integrated International Oil industry’s fall of 39.9%. The Zacks analyst believes that with no near-term recovery in demand in the horizon, owing to coronavirus pandemic, the firm’s refining business is not expected to improve anytime soon.
Notably, the company estimates gross recoverable resource of more than 8 billion oil-equivalent barrels from offshore Guyana discoveries. The energy giant’s first-quarter 2020 results were better than expected, thanks to growth in production from the prolific Permian & Guyana oil resources. This was partially offset by lower industry refining margin and decline in commodity prices.
ExxonMobil’s bellwether status in the energy space, optimal integrated capital structure that has historically produced industry-leading returns and management’s track record of capex discipline across the commodity price cycle makes it a relatively lower-risk energy sector play.
Adobe’s shares have lost 0.6% over the past three months against the Zacks Software industry’s fall of 5.8%. The Zacks analyst remains optimistic about Adobe’s market position, compelling product lines, continued innovation, solid adoption of Creative Cloud and Adobe marketing cloud.
Adobe is benefiting from strong demand for its creative products. The company’s Creative Cloud, Document Cloud and Adobe Experience Cloud products are driving the top-line growth. Further, rising subscription revenues and solid momentum across the mobile apps are major positives.
Additionally, growth in emerging markets, robust online video creation demand and improving average revenue per user are tailwinds. However, the company has given weak guidance for the current quarter due to coronavirus scare which might delay enterprises booking decisions, reduce marketing spending and hurt consulting service implementations.
Other noteworthy reports we are featuring today include Comcast (CMCSA), ConocoPhillips (COP) and Las Vegas Sands (LVS).
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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>>>