Today’s Research Reports on Stocks to Watch: Starbucks and CSX

U.S. markets surged Thursday on the strength of the latest batch of corporate earnings and Treasury Secretary Steven Mnuchin’s comment that the Trump Administration was close to releasing a “major tax reforms”. The Dow Jones Industrial Average gained 0.85 percent to close at 20,578.71, while the S&P 500 rose 0.76 percent to close at 2,355.84.

Data from Thomson Reuters shows that out of the 82 S&P 500 companies who have reported earnings through Thursday afternoon, approximately 75 percent have surpassed expectations, topping the average of 71 percent over the past 4 quarters. The profit of S&P 500 companies is estimated to increase by 11.1 percent in the quarter, according to Reuters.

"They really are just focusing now on the micro, which they should be, on the earnings and what the earnings are saying," Ken Polcari, director of the NYSE floor division at O’Neil Securities, told Reuters. "Investors are putting the geopolitical stuff to the back of the bus at the moment and they are really focusing on what they should be."

RDI Initiates Coverage on:

Starbucks Corp.

CSX Corporation

Starbucks’s shares increased 1.76 percent to close at $60.08 a share on Thursday. The stock traded between $59.56 and $60.33 on volume of 12.45 million shares traded. The company is scheduled to report results for the second quarter of fiscal 2017 after market close on Thursday, April 27th, with a conference call to follow at 2:00 pm PT. Stifel analyst Mark Astrachan has upgraded the company’s rating to “buy” from “hold” and has also raised the stock’s price target to $67 from $60. Astrachan expects Starbucks’ U.S. comp store sales growth to grow by 5 to 6 percent for the next four quarters. Shares of Starbucks have gained approximately 8.21 percent year-to-date.

Access RDI’s Starbucks Research Report at:

CSX Corp.’s shares spiked 5.60 percent to close at $49.56 a share on Thursday. The stock traded between $49.36 and $51.28 on volume of 25.36 million shares traded. The company reported net earnings of $362 million, or $0.39 per share, for the first quarter of 2017, compared to $356 million, or $0.37 per share, in the year ago quarter. Adjusted earnings were $0.51 a share for the first quarter. Revenues increased 10 percent year-over-year to 2.87 billion. Analysts’ expectations had called for adjusted earnings of $0.43 on revenues of $2.76 billion, according to FactSet. The company expects earnings per share for the full year 2017 to grow by approximately 25 percent from the 2016. Shares of CSX have gained approximately 37.93 percent year-to-date.

Access RDI’s CSX Research Report at:

Our Actionable Research on Starbucks Corporation (NASDAQ:SBUX) and CSX Corporation (NASDAQ:CSX) can be downloaded free of charge at Research Driven Investing.

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