Tuesday, October 31, 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 ExxonMobil Corp. (XOM), Philip Morris International Inc. (PM) and General Electric Co. (GE). 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 >>>

Shares of ExxonMobil have underperformed the Zacks Oil and Gas - Integrated - International industry over the year-to-date period (-1.6% vs. -0.4%). The company demonstrates a higher level of operational volatility than the broader market. The firm’s dividend yield is lower than the composite stocks belonging to the industry. Thus, ExxonMobil is lagging its peers when it comes to shareholder returns.

Nevertheless, ExxonMobil's bellwether status and an optimal integrated capital structure that has historically produced industry-leading returns make it a relatively lower-risk energy sector play.

In Stabroek Block, located off the coast of Guyana, ExxonMobil has made many major discoveries that significantly improve its production outlook. The advantaged growth projects of Guyana have lower greenhouse gas intensity than most of the oil and gas-producing resources across the globe.

(You can read the full research report on Exxon Mobil here >>>)

Philip Morris shares have outperformed the Zacks Tobacco industry over the past year (+2.8% vs. -3.6%). The company has been gaining from its pricing power. Higher pricing variance was an upside to the company’s performance in the second quarter of 2023 and is likely to remain a driver.

A focus on reduced-risk products, especially IQOS, has been working well for the company, which is witnessing a continued product mix shift from cigarettes to smoke-free products. These upsides are likely to boost organic revenues in the full-year 2023.

However, Philip Morris has been battling cost-related headwinds. The company expects to make additional growth-oriented investments in 2023, which may crimp near-term margins. Also, soft cigarette shipment volumes and volatile currency movements have been concerns.

(You can read the full research report on Philip Morris here >>>)

Shares of General Electric have outperformed the Zacks Diversified Operations industry over the past year (+78.3% vs. -5.5%). The company’s strong performance of the Aerospace unit, driven by commercial aerospace strength, significant growth in LEAP engine deliveries and higher defense engine orders, is aiding General Electric’s growth.

With strength in GE Gas Power services and growth at Grid business and Onshore Wind in North America, signs of improvement in GE Vernova (the combined operations of GE Power and Renewable) hold promise. Due to these tailwinds, the company has raised its 2023 guidance. Amid these positives, shares of General Electric have outperformed its industry in the past six months.

However, supply chain disruptions in the defense market continue to take a toll on the company’s operations. Inflationary pressure poses a threat to General Electric’s bottom line. Foreign currency challenges and lower aeroderivative shipments are other concerns for GE.

(You can read the full research report on General Electric here >>>)

Other noteworthy reports we are featuring today include BlackRock, Inc. (BLK), Arista Networks, Inc. (ANET) and Atlassian Corp. (TEAM).

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>>>