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Research Daily

Mark Vickery

Top Research Reports for Microsoft, CVS Health & Lockheed Martin


Trades from $3

Wednesday, September 7, 2022

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 Microsoft Corp. (MSFT), CVS Health Corp. (CVS) and Lockheed Martin Corp. (LMT). 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 >>>

Microsoft shares have declined -14.9% over the past year against the Zacks Computer - Software industry’s decline of -22.0%. The company’s increased spending on Azure enhancements amid stiff competition in the cloud space from Amazon is likely to dent margins. Nevertheless, the company’s performance is benefiting from strength in its Azure cloud platform amid accelerated global digital transformation.

Teams’ user growth is gaining from continuation of remote work and mainstream adoption of hybrid/flexible work model. Recovery in advertising and the job market boosted LinkedIn and Search revenues. Solid uptake of new Xbox consoles is aiding the gaming segment performance.

The company is witnessing growth in user base of its different applications including Microsoft 365 suite, Dynamics and Power Platform. Microsoft expects Surface revenues to grow in the mid-teens range, driven by strong demand for premium devices.

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

CVS Health’s shares have outperformed the Zacks Retail - Pharmacies and Drug Stores industry over the past year (+16.6% vs. +1.7%). The company’s robust sales growth across all three operating segments drove the top-line results. The extended cough, cold and flu season boosted sales in the Retail and Pharmacy businesses.

Within the Health Care Benefits arm, the continued growth across the entire range of insured and self-insured medical, pharmacy, dental and behavioral health products and services instills optimism. Its raised EPS guidance for 2022 is indicative of this growth momentum continuing.

However, the contraction of margins does not bode well. The decline in COVID-19 vaccinations and testing sales is a downside. Persistent pharmacy reimbursement headwinds also continued to impact business results.

(You can read the full research report on CVS Health here >>>)

Lockheed Martin’s shares have outperformed the Zacks Aerospace - Defense industry over the past year (+23.0% vs. -32.9%). The company remains the largest U.S. defense contractor, with a steady inflow of orders from its leveraged presence in the Army, Air Force, Navy and IT programs. Steady contract flows and subsequent backlog growth bolster its long-term revenue prospects.

The F-35 program continues to be a key growth program for the company’s Aeronautics business segment and boosts its sales prospects. Budgetary provisions tend to boost its business.

Yet, the tiff between the U.S. and Turkey on the latter's accepting of Russian products might hurt Lockheed's component supply from Turkey. The company is facing performance issues concerning some of its products, which, in turn, may hamper results. Also, uncertainties revolving around possible sanctions from China on Lockheed might impact the company.

(You can read the full research report on Lockheed Martin here >>>)

Other noteworthy reports we are featuring today include Berkshire Hathaway Inc. (BRK.B), Dominion Energy, Inc. (D) and Mitsubishi UFJ Financial Group, Inc. (MUFG)

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>>>

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