Top Analyst Reports for Oracle, Chevron & Linde
Friday, August 11, 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 Oracle Corporation (ORCL), Chevron Corporation (CVX) and Linde plc (LIN). 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 >>>
Oracle shares have handily outperformed the Zacks Computer - Software industry over the past year (+45.1% vs. +14.1%), reflecting momentum across its cloud business on the back of strong uptake of Oracle Cloud Infrastructure services and Autonomous Database offerings. Solid adoption of cloud-based applications, comprising NetSuite Enterprise Resource Planning (ERP) and Fusion ERP bodes well.
Oracle’s Gen 2 Cloud is delivering better performance at a lower cost due to high bandwidth and low-latency RDMA networks. Partnerships with NVIDIA and Microsoft benefits Oracle. Oracle is partnering with NVIDIA to build the world's largest high-performance computer, an AI computer, with 16,000 GPUs.
The company also announced that it is launching a generative AI cloud service for enterprise customers. Shares have outperformed the industry year to date. However, stiff competition is hurting growth.
(You can read the full research report on Oracle here >>>)
Shares of Chevron have gained +4.2% over the past year against the Zacks Oil and Gas - Integrated - International industry’s gain of +14.7%. The company 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.
However, Chevron 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.
(You can read the full research report on Chevron here >>>)
Linde shares have outperformed the Zacks Chemical - Specialty industry over the past year (+24.6% vs. +4.5%), reflecting favorable outlook for industrial gases. The company’s primary products in industrial gases include oxygen, which is used as life support in hospitals.
Linde has long-term contracts with on-site customers backed by minimum purchase requirements, thereby securing stable cashflows. In the profitable industrial gas market, the merger of Praxair and Linde has created an efficient player with considerable size advantages. Linde reported strong second quarter earnings aided by higher pricing from its Americas segment.
However, declining free cashflow is a concern, reflecting weakness in operating activities. Moreover, the company is extremely vulnerable to uncertainty associated with the slowdown of economic growth, as this could hurt demand for its industrial gases.
(You can read the full research report on Linde here >>>)
Other noteworthy reports we are featuring today include The Walt Disney Company (DIS), Bristol-Myers Squibb Company (BMY) and Airbnb, Inc. (ABNB).
Director of Research
Sheraz Mian
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>>>
Today's Must Read
Oracle (ORCL) Gains from Cloud Suite Adoption & Partnerships
Chevron (CVX) to Gain from Massive Permian Acreage
Linde's (LIN) Long-Term Contracts with Minimum Volume Aids
Featured Reports
Strong Content Portfolio & Parks Business Aids Disney (DIS)
Per the Zacks analyst, Disney benefits from strong content portfolio across its platforms including Disney+. Moreover, revival of the theme parks business bodes well for the company's prospects.
Opdivo, New Drugs Drive Fuel Bristol (BMY) Amid Competition
Per the Zacks analyst, strong demand for Opdivo and incremental sales from new drugs fuel growth for Bristol Myers. However, one of the top revenue generators Revlimid is facing generic competition.
Airbnb (ABNB) Banks on Strong Nights & Experiences Bookings
Per the Zacks analyst, strengthening gross nights booked in high-density urban areas, and recovery in both long-distance and cross-border travel are benefiting Airbnb's Nights & Experience bookings.
Broadridge (BR) Benefits From a Strong Business Model Amid Competition
Per the Zacks analyst, Broadridge's strong business model enables it to enjoy recurring revenues, which form a lion's share of the company's topline. Stiff competition is an overhang.
Dialysis Center Buyouts Aid DaVita (DVA) in Stiff Competition
The Zacks analyst is upbeat about DaVita's preferred business strategy of acquiring businesses that own and operate dialysis centers despite its operation in a tough competitive landscape.
Vornado (VNO) to Ride on Premier Assets, Repositioning Moves
Per the Zacks analyst, healthy demand for premium assets is likely to lure tenants at Vornado's properties. Its repositioning efforts bode well, though high interest rates remain a key concern.
Solid Portfolio and Increasing Contract Wins Aid Plexus (PLXS)
Per the Zacks analyst, Plexus' performance is being driven by from solid momentum in Healthcare/Life Sciences and Aerospace/Defense sectors. Also, rising manufacturing contract wins is a tailwind.
New Upgrades
Penske (PAG) Powered by Buyouts & Balance Sheet Strength
The buyouts of Kansas City Freightliner, McCoy, Team Trucks Centers and Transolutions Truck Centres are driving Penske. It has a low leverage ratio of 26%, which makes the Zacks analyst positive.
Solid Bookings To Aid Norwegian Cruise (NCLH), Costs High
Per the Zacks analyst, Norwegian Cruise is likely to benefit from strong consumer demand, solid bookings and fleet expansion efforts. However, volatility in inflation and interest rates are a concern.
Rise in Digital Subscribers to Lift NY Times' (NYT) Revenues
Per the Zacks analyst, The New York Times Company benefits from increase in digital subscribers. Management anticipates digital-only subscription revenues to rise 14-17% in third-quarter 2023.
New Downgrades
Poor Domestic Travel to Hit Hawaiian Electric's (HE) Results
Per the Zacks analyst, domestic travel is expected to weaken in late 2023, which may lead to lower domestic visitor arrival in Hawaii. This may hurt Hawaiian Electric's results.
Rising Operating Costs and Forex Woes Hurt MRC Global (MRC)
Per the Zacks analyst, MRC Global's operational efficiencies are being dampened by a steep rise in operating costs, which is hurting the company's bottom line. Forex woes are an added concern.
Euronet (EEFT) Hurt by High Costs, Lower epay Transactions
Per the Zacks analyst, the company's escalating expenses continue to put pressure on its margins. Also, declining transactions processed in the epay segment are likely to reduce gross profit.
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Chevron Corporation (CVX) : Free Stock Analysis Report
Bristol Myers Squibb Company (BMY) : Free Stock Analysis Report
Oracle Corporation (ORCL) : Free Stock Analysis Report
The Walt Disney Company (DIS) : Free Stock Analysis Report
Linde PLC (LIN) : Free Stock Analysis Report
Airbnb, Inc. (ABNB) : Free Stock Analysis Report
