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Top Stock Reports for PepsiCo, Thermo Fisher Scientific & Canadian National Railway

Friday, October 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 PepsiCo, Inc. (PEP), Thermo Fisher Scientific Inc. (TMO) and Canadian National Railway Company (CNI). 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 >>>

PepsiCo shares have handily outperformed the S&P 500 index this year (-6.9% vs. -22%), though they have done only modestly better than rival Coke's -7.6% decline. We will see if performance momentum can be sustained following the company's quarterly results next week.

PepsiCo benefits from the resilience and strength of global beverage and convenient food businesses. It expects to benefit by delivering convenience, variety and value proposition to customers through its brands. It raised its revenue view for 2022.

However, it witnessed margin pressures in the second quarter driven by impacts of supply-chain disruptions and inflationary labor, transportation and commodity costs. PEP anticipates incremental input cost inflation for the balance of 2022. Adverse currency rates also remain headwinds.

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

Thermo Fisher Scientific's shares have declined -7.3% over the past year against the Zacks Medical - Instruments industry’s decline of -32.0%, with the improved performance reflecting favorable outlook for the Analytical Instruments, Laboratory Products and Biopharma Services business lines. The company’s strategic acquisitions of PPD, Inc. and PeproTech raise investors’ confidence.

Thermo Fisher’s accelerated investments to expand bioproduction capacity also buoy optimism. The upbeat guidance for 2022 is indicative that this growth momentum will continue.

(You can read the full research report on Thermo Fisher Scientific here >>>)

Canadian National Railway's shares have declined -4.0% over the past year against the Zacks Transportation - Rail industry’s decline of -9.1%. The company is facing supply chain disruptions, network fluidity challenges and weak Canadian grain crops are hurting the company’s volumes. Escalating fuel prices amid the Russia-Ukraine war pose a threat to Canadian National's bottom line. The company’s weak liquidity position is an added concern.

However, In January, Canadian National Railway has announced a 19% dividend hike. Canadian National is also active on the share buyback front. Strong cash flow generating-ability supports Canadian National's shareholder-friendly activities.

The company is benefiting from strong freight demand and solid pricing. With this, management expects adjusted earnings to increase 15-20% year over year in the current year.

(You can read the full research report on Canadian National Railway here >>>)

Other noteworthy reports we are featuring today include Occidental Petroleum Corporation (OXY), CME Group Inc. (CME), and Truist Financial Corporation (TFC).

Sheraz Mian
Director of Research

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

Momentum in PepsiCo's (PEP) Snacking Business to Aid Growth

Thermo Fisher (TMO) Advances in Bioprocess, End Market Up

Canadian National (CNI) Rides on Freight Revenues, Costs Ails

Featured Reports

Permian Basin Focus, Low-cost operation Aid Occidental (OXY)
Per the Zacks analyst Occidental's acquisition of Anadarko expanded its operation in resource rich Permian Basin and low cost operation will boost its profits over the long run.

CME Group (CME) Banks on Futures Products, Expenses A Concern
Per the Zacks analyst, the company is well poised for growth with the expansion of futures products in emerging markets and OTC offerings. However, elevated expenses remain an overhang

Higher Rates, Loan Demand Aid Truist (TFC), High Costs a Woe
Per the Zacks analyst, loan demand, higher interest rates and Truist Financial's efforts to improve fee income will aid financials. Yet, rising costs and challenging operating backdrop are headwinds.

America Movil (AMX) Benefits from High Demand For 5G network
Per the Zacks analyst, America Movil's performance is gaining from robust demand for 5G and wireless network. However, high network investments and firm's high leverage remain concerns.

Pricing Actions Aid Parker-Hannifin (PH) Amid Cost Headwinds
While escalating cost of sales are hurting the company's margins, the Zacks analyst is impressed by its effective pricing actions to stay afloat.

Apellis' (APLS) Empaveli Drives Growth Amid Stiff Competition
Per the Zacks analyst, Apellis' lead drug, Empaveli, has been driving growth since its launch. The drug's label expansion studies hold promise. Stiff competition in the target market remains a woe.

United Rentals (URI) Banks on Equipment Rental Business
Per the Zacks analyst, United Rentals' equipment rental unit is gaining from better fleet productivity on broad-based rental demand. Acquisitions and government's infrastructure improvement plan aid.

New Upgrades

Digital Transformation and Product Strength Aid Nutanix (NTNX)
Per the Zacks analyst, Nutanix is benefiting from higher investments by clients in digital transformation as well as frequent product refreshes, which help it to gain new customers.

Post Holdings (POST) Benefits From Prudent Acquisitions
Per the Zacks analyst, Post Holdings is benefiting from its focus on acquisitions. During third-quarter fiscal 2022, the company's top line included $128.1 million in net sales from acquisitions.

Liberty Energy (LBRT) to Gain from Multi-Basin Presence
The Zacks analyst believes that Liberty Energy's footprint in a number of North American plays offers attractive growth opportunity compared to most of its peers lacking geographic diversification.

New Downgrades

Escalating Costs, Soft Cash Flows Hurt Select Medical (SEM)
Per the Zacks analyst, a rise in expenses due to higher cost of services might dent the company's margins. A decline in operating cash flows remains a concern.

Weakening Memory Chip Demand to Hurt Micron's (MU) Sales
Per the Zacks Analyst, weakening consumer spending on personal computers and smartphones is expected to negatively impact demand for Micron's memory chips in the near term.

Soft Demand for Office Space to Hurt Vornado's (VNO) Leasing
Per the Zacks Analyst, a choppy office real estate market environment is likely to hurt the demand for Vornado's properties in the near term. Also, high geographic asset-concentration adds to its woes

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CME Group Inc. (CME): Free Stock Analysis Report
Canadian National Railway Company (CNI): Free Stock Analysis Report
Occidental Petroleum Corporation (OXY): Free Stock Analysis Report
Thermo Fisher Scientific Inc. (TMO): Free Stock Analysis Report
PepsiCo, Inc. (PEP): Free Stock Analysis Report
Truist Financial Corporation (TFC): Free Stock Analysis Report
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