Friday, October 16, 2020
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 Novartis (NVS), Zoom Video Communications (ZM) and Fidelity National Information Services (FIS). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Novartis shares have underperformed the Zacks Large-Cap Pharmaceuticals in the year to date period (-9.9% vs. -2.3%). The Zacks analyst believes that solid performance of key drugs like Cosentyx and Entresto, and contributions from Kisqali and gene therapy, Zolgensma, have also boosted the company’s performance in the recent past.
These drugs and new launches like Piqray, Mayzent and Beovu should further boost sales amid a slowdown due to the ongoing pandemic. The biosimilar portfolio also gains traction with new key approvals and is expected to drive growth. Novartis’ efforts to develop and diversify its pipeline are also impressive.
However, price erosion in the United States has adversely impacted the generics business. Moreover, pipeline setbacks and generic competition for key drugs are concerning. Shares have underperformed the industry in the past year. The company has tightened its outlook for 2020 due to the pandemic woes.
Shares of Zoom Video have gained +734.8% over the past year against the Zacks Internet Software industry’s rise of 93.8%. The Zacks analyst believes that demand for the company’s cloud-native video-first platform is expected to remain solid owing to the work-from-home and online-learning wave.
Easy to deploy, use, manage and scalability makes Zoom Video’s software popular among its customers. Expanding clientele is expected to drive top-line growth momentum in the near term. Moreover, the company’s expanding international presence is a key catalyst.
Its efforts to eliminate the security and privacy loopholes, as well as new hardware and Zoom From Home solution’s launch, are expected to help in expanding clientele. The company’s strong free cash-flow generating ability is noteworthy. However, acute competition from the likes of Microsoft and Cisco in the video-communication space does not bode well.
FIS shares have gained +14% over the past six months against the Zacks Financial Transaction Services industry’s rise of +19.1%. The Zacks analyst believes that the company remains well-poised for growth, backed by attractive core business with several ongoing initiatives and a broad customer base.
The acquisition of Worldpay will accelerate growth by expanding presence in fast-growing markets. Further, increasing investment in mobile banking and innovative products is likely to support Fidelity’s growth.
Also, earnings estimates have been going down lately ahead of third-quarter results. The company remains exposed to rising costs on account of investment in technology, and consolidation in the banking sector. It faces credit risk in case of any economic downturn.
Other noteworthy reports we are featuring today include Amgen (AMGN), 3M Company (MMM) and TOTAL SE (TOT).
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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
Amgen expects several important data readouts from its pipeline in second-half 2020. It also pursues external opportunities as evident from the purchase of Otezla.
Per a Zacks analyst, 3M (MMM) is poised to gain from a high demand for respirators and products for personal safety, home improvement, and others.
Per the Zacks analyst TOTAL’s focus to develop LNG assets globally and its strong production growth through a new startup is going to boost its performance.
The Zacks analyst is impressed by residential volume growth at the company’s Ground unit. FedEx’s strong liquidity position is an added positive.
While a significant reduction in costs is aiding CSX, the Zacks analyst is concerned about the coronavirus-led volume softness.
Per the Zacks analyst, Infosys is benefiting from large deal wins and higher investments by clients in digital transformation, artificial intelligence and automation.
Per the Zacks analyst, Vertex’s sales in 2020 are being driven by the rapid uptake of Trikafta as well as higher international revenues.
AutoZone’s rising e-commerce efforts like the recently introduced curbside pick-up option, along with cost cut measures, are likely to boost the firm’s bottom line in future, per the Zacks analyst.
Per the Zacks analyst, ITT’s innovation investments & initiatives to expand its manufacturing automation capabilities will boost its competency.
Per the Zacks analyst, its improving topline driven by Medicaid and Medicare businesses as well as strategic measures poises it well for growth.
While collaborations with Subaru and Mazda are likely to buoy Toyota’s e-mobility prospects, coronavirus-led sluggish vehicle demand is hurting near-term profits, per the Zacks analyst.
Per the Zacks analyst, cruise cancellations and cash burn due to the coronavirus pandemic continues to hurt Royal Caribbean. Due to the pandemic, bookings for 2020 have declined significantly.
The Zacks analyst believes that the weak gasoline prices might continue to hamper Murphy USA’s bottom line. The company’s high debt level is also a concern.
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Zoom Video Communications, Inc. (ZM): Free Stock Analysis Report
TOTAL S.A. (TOT): Free Stock Analysis Report
Novartis AG (NVS): Free Stock Analysis Report
3M Company (MMM): Free Stock Analysis Report
Fidelity National Information Services, Inc. (FIS): Free Stock Analysis Report
Amgen Inc. (AMGN): Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.