Wednesday, March 15, 2017

Today's Research Daily features new research reports on 16 major stocks, including Bank of America  (BAC), Oracle (ORCL) and Suncor Energy (SU).

Bank of America’s shares have been one of the biggest beneficiaries of the changed macro backdrop following the election, which includes expectations of faster economic growth and overhaul of the country's tax and regulatory systems. Further, easing margin pressure driven by an improving rate scenario will support the top line.

Moreover, the company's efforts to streamline and simplify operations continue to enhance efficiency and strengthen its balance sheet. No doubt, Bank of America shares have been strong performers since the election -- up +48.9% since November 8th vs. +29.7% gain for the Zacks Major Banks industry in that time period, but the analyst still sees plenty of upside in for the stock. (You can read the full research report on Bank of America here.)

Oracle is in the middle of a business transition from on-premise licensing to cloud-based business model, which will be accretive to long term growth. However, it is a drag on the financials at present. Not surprisingly then, Oracle has underperformed the Zacks Technology Sector in the last one-year, gaining +6.4% vs. +16.9%. However, estimates have been stable lately ahead of the company’s Q3 earnings release. 

Also, the company has mixed record of earnings surprises in recent quarters. But the Zacks analyst likes the ongoing momentum at SaaS and PaaS, which provides significant growth opportunities. The introduction of Generation2 IaaS data centers are expected to improve Oracle’s competitive prowess against Amazon Web Services and will drive market share going ahead. (You can read the full research report on Oracle here.)

Shares of Suncor Energy have gained +15% over the last 6 months, handily outperforming the Zacks Oil & Gas - Canadian Integrated industry, which rose just +9% over the same time period, as well as key rival Canadian Natural Resources. SU recently came out with better-than-expected Q4 profit, with production rising to a record on the back of its recent transactions to gain a majority stake in the massive Syncrude oil sands project.

Importantly, SU's success in reducing cash costs has magnified the effects of rebound in oil prices. A 10% dividend boost and plans for share buyback are other positives in the Suncor story. However, extracting crude from the oil sands is a costly affair and as such, hampers profit margins. (You can read the full research report on Suncor Energy here.)

Other noteworthy reports we are featuring today include Southwest Airlines (LUV), Telefonica (TEF) and Dominion Resources (D).

Will You Make a Fortune on the Shift to Electric Cars?
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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 >>>