Friday, October 9, 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 Mastercard (MA), JPMorgan Chase (JPM) and Eli Lilly (LLY). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Mastercard shares have outperformed the Zacks Financial Transaction Services industry in the year to date period (+17.4% vs. +5.5%). The Zacks analyst believes that Mastercard’s strategic acquisitions, alliances and technology upgrades, along with product-diversification and geographic-expansion initiatives augur well for the long-term.
The company has undertaken several acquisitions to supplement organic efforts and diversify revenues over the years, which has helped expand its addressable markets and strengthen core product solutions. It is gaining from an increased demand for digital and contactless solutions owing to the COVID crisis.
Investment in technology keeps it at the forefront of the rapidly-evolving payments industry. It is also witnessing buoyant demand for its Data & Analytics and Cyber solutions. However, escalating costs might put pressure on the company’s margins. It also cancelled its annual 2020 outlook for net revenues and operating expense due to coronavirus-induced losses.
JPMorgan shares have outperformed other money-center banks latey, but the stocks continue to lag the broader market as investors remain focused on the tough operating environment for banks characterized by low interest rates and cyclical pressures. These headwinds notwithstanding, the Zacks analyst is optimistic about JPMorgan's long-term prospects ahead of its quarterly report next week on the back of branch openings in new regions, acquisition of InstaMed, reversal in mortgage banking business and focus on credit card operation.
Additionally, the company has kept the dividend level unchanged currently, following the clearance of annual stress test results. However, the Fed’s accommodative policy and near-zero rates are expected to hurt the bank’s interest income and margins.
Further, coronavirus-induced economic downturn will likely continue to hamper business activities. Thus, loan growth will likely be muted in the near term.
Eli Lilly shares have gained +7.3% over the past six months against the Zacks Large Cap Pharmaceuticals industry’s rise of +6.5%. The Zacks analyst believes that generic competition for several drugs, rising pricing pressure in the United States, and price cuts in some international markets like China, Japan and Europe are some top-line headwinds for the company.
Lilly expects revenue growth to be driven by higher demand for its growth drugs like Trulicity, Taltz, and others and from product launches in diabetes, autoimmune diseases and cancer. Lilly is making significant pipeline progress including its efforts to make therapies to treat COVID-19.
Though new prescription volume of several medicines declined in Q2 due to COVID-19, the trends are expected to improve in the second half. Estimates have gone up ahead of Q3 results. Lilly has a positive record of earnings surprises in the recent quarters.
Other noteworthy reports we are featuring today include Bristol-Myers Squibb (BMY), Caterpillar (CAT) and Anthem (ANTM).
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Today’s Must Read
Per the Zacks analyst, label expansion of blockbuster drug Opdivo should maintain momentum for Bristol-Myers amid stiff competition. Moreover, Eliquis and Revlimid further propel the top-line.
Per the Zacks analyst, Caterpillar’s focus on cutting down costs will help sustain margins despite the weak demand owing to the impact of the coronavirus pandemic.
Per the Zacks analyst, a number of acquisitions and collaborations have helped it enhance its capabilities and boost its Medicare business.
The Zacks analyst believes that acquisitions help ADP strengthen its position in the HCM market.
Per the Zacks analyst, VMware is benefiting from strong demand for its expanding cloud-based solutions, strong partner base, and Carbon Black & Pivotal acquisitions.
Per the Zacks analyst, better price management, merchandise efforts, operational initiatives, and coronavirus-led demand spike should drive sales.
Per the Zacks analyst, Exelon’s cost management initiatives will have a positive impact on margins and its planned $26B investments through 2023 will strengthen its operation.
The Zacks analyst is upbeat about Omnicell’s launch of EnlivenHealth to improve patient outcomes and cut costs via Software-as-a-Service technology solutions.
Per the Zacks analyst, Avnet’s continued focus on boosting its IoT capabilities is helping it expand in newer markets and gain customers.
Per the Zacks analyst, Vishay is riding on strength across its resistors and capacitors offerings which are aiding its presence in the industrial, military, and medical end-markets.
The Zacks analyst is worried about the coronavirus-led decline in passenger revenues. Moreover, trimmed capacity is flaring up unit costs.
Per the Zacks analyst, soft demand due to weakness in global industrial markets will hurt the company’s top line. It also faces headwinds from lower pricing in certain bulk commodities.
Per a Zacks analyst, softness in various end-markets, including commercial aerospace, metals, mining, and others, might hurt Altra Industrial (AIMC) in the quarters ahead.
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Mastercard Incorporated (MA): Free Stock Analysis Report
Eli Lilly and Company (LLY): Free Stock Analysis Report
JPMorgan Chase Co. (JPM): Free Stock Analysis Report
Caterpillar Inc. (CAT): Free Stock Analysis Report
Bristol Myers Squibb Company (BMY): Free Stock Analysis Report
Anthem, Inc. (ANTM): Free Stock Analysis Report
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