Monday, February 1, 2021

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 Netflix (NFLX), Bristol-Myers Squibb (BMY) and Abbott Laboratories (ABT). 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 >>>

Netflix pioneered the streaming business, which every media company is now scrambling to compete in. The worry among many Netflix investors has been whether the company's first-mover status in the space gives it any competitive edge against new rivals like Disney that not only has a deep library of content, but also has fortress balance sheet.

We will see how the 'streaming wars' shake out over time, but Netflix has thus far been able to hold its ground, as can be seen in the stock's recent performance (+48.7% over the past year vs. +15.9% for the S&P 500 index). 

In the fourth-quarter 2020, Netflix witnessed solid growth in paid-user addition rate, reflecting strong demand for content. The company is dominating the streaming space, courtesy of its diversified content portfolio, which is attributable to heavy investments in the production and distribution of localized, foreign-language content.

Higher number of originals is expected to aid user base growth in 2021 despite rising competition from Apple TV+, Amazon prime video, HBO Max, Disney+, Peacock, Discovery+ and TikTok. The company plans to release at least one new original film every week in 2021. Moreover, the launch of low-priced mobile plans is expected to expand its subscriber base in Asia Pacific.

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

Shares of Bristol-Myers have gained +4% in the last six months against the Zacks Biomedical and Genetics industry’s gain of +5.1%. The Zacks analyst believes that its immuno-oncology drug, Opdivo, and blood thinner drug, Eliquis, will drive growth for Bristol-Myers.

Eliquis is the leading oral anti-coagulant drug and the company continues to witness growth in both Eliquis brand and the market. However, the decline in Opdivo sales is concerning. The addition of sales from Celgene’s drugs has boosted growth prospects.

In particular, the addition of Revlimid has strengthened the oncology portfolio and fueled the top line. The label expansion of Opdivo for first-line NSCLC should somewhat offset the decline. Approval of new drugs like Inrebic, Reblozyl, Zeposia and Onureg adds a new stream of revenues. However, concerns will rise once Revlimid loses patent protection.

(You can read the full research report on Bristol-Myers here >>>)

Abbott shares have gained +15% over the past three months against the Zacks Medical Products industry’s rise of +10.3%. The Zacks analyst believes that the branded generics and international diabetes businesses should drive growth in the coming quarters. New product launches and acquisitions should boost sales further.

The company has been witnessing improvements in testing and procedure volumes across its hospital-based businesses. At the same time, its consumer-facing businesses like diabetes care, nutrition and established pharmaceuticals (EPD), are catching up pace. In Adult Nutrition, the company reported strong double-digit growth on robust sales of Ensure and Glucerna. Diabetes Care sales were strong on solid worldwide adoption of FreeStyle Libre.

In 2020, the company received U.S. approval of Freestyle Libre 2 and CE Mark for Libre 3 and Libre Sense Glucose Sport. Yet, the company’s performance was disappointing particularly in Pediatric Nutrition, Cardiovascular and Neuromodulation.

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

Other noteworthy reports we are featuring today include Honeywell International (HON), Starbucks (SBUX) and Target (TGT).

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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>>>