Friday, April 7, 2017

Today's Research Daily features new research reports on 16 major stocks, including Johnson & Johnson (JNJ), Verizon (VZ) and Visa (V).

Johnson & Johnson shares have gained +14.6% over the last year, widely outperforming the large-cap pharma space (up +2.1%). While the company is faced with a number of headwinds like unfavorable currency movements, increased competition from generics, pricing pressures and an uncertain global macroeconomic backdrop, the Zacks analyst believes that JNJ's diversified business model, deep product pipeline, lack of cyclicality and financial strength position it for continued momentum going forward.

Also, the potential Actelion buyout, though expensive, will bolster J&J’s long-term growth. However, in 2017, growth in J&J’s Pharma segment is expected to suffer as key growth drivers have slowed down due to competition. Estimates have remained mostly stable lately ahead of the Q1 earnings results. (You can read the full research report on Johnson & Johnson here.)

Shares of Verizon have been laggards over the past year- the stock is down -7.2% over the past 12 months vs. AT&T's +5.5% gain and the +14.4% gain for the S&P 500 index. Verizon has started conducting 5G wireless network trials in 11 U.S. cities and plans to deploy its fixed wireless version in 2018. The company’s decision to launch FiOS Prepaid plan, FiOS Internet service and to zero-rate its data on FiOS Mobile App should help it gain subscribers while unlimited data plans have heated up the wireless industry.

The Verizon-Yahoo deal underwent a discount revision of $350 million. But it will likely take a while before these actions bear fruit. In the updated research report issued today, the Zacks analyst discusses the pros & cons of investing in Verizon shares at this stage. (You can read the full research report on Verizon here.)

Buy rated Visa’s shares have marginally underperformed the Zacks Financial Transaction Services industry over the past one year, gaining +14.2% vs. +14.8%. The Zacks analyst likes the company’s strategic acquisitions and alliances, technology upgrades and effective marketing efforts.

Visa is experiencing growth from acquisition of Visa Europe and solid growth in payments volume as well as processed transactions. In addition, global economic uncertainty and legal headwinds are major concerns. Higher client incentives also pose a risk on profitability. (You can read the full research report on Visa here.)

Other noteworthy reports we are featuring today include Colgate-Palmolive (CL), General Dynamics (GD) and Abbott (ABT).

The Best & Worst of Zacks

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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 >>>