Wednesday, February 10, 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 JPMorgan Chase (JPM), Merck (MRK) and NextEra Energy (NEE). 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 >>>

JPMorgan shares have outperformed the Zacks Major Regional Banks industry over the past year (+1.8% vs. -8.5%). The Zacks analyst believes that branch openings in new regions, inorganic expansions and strong mortgage banking business are likely to continue supporting the company’s financials.

While the Fed's accommodative policy and near-zero rates are expected to hurt interest income and margins, and coronavirus-induced economic downturn has hampered business activities, thereby hurting loan demand, gradual economic recovery amid vaccine breakthroughs will aid JPMorgan.

Additionally, the company’s enhanced capital deployments reflect earnings strength and solid balance sheet. Meanwhile, The company's earnings have outpaced the Zacks Consensus Estimate in three of the trailing four quarters. Its fourth-quarter 2020 results reflect reserve releases, solid fee income performance, and adverse impact of low rates and weak loan demand.

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

Shares of Merck have lost -7.5% in the last six months against the Zacks Large Cap Pharmaceuticals industry’s gain of +5.2%. The Zacks analyst believes that drugs like Keytruda, Lynparza and Bridion have been driving sales.

Continued uptake in lung cancer and increasing usage in other cancer indications has boosted Keytruda’s sales. Moreover, animal health and vaccine products remain core growth drivers. The potential separation into two companies makes strategic sense as the remaining Merck should be able to achieve higher profits than the combined company.

However, generic competition for several drugs and rising competitive pressure, mainly on the diabetes franchise, will continue to be overhangs on the top line. Sales of some key products are being hurt due to reduced wellness visits and delayed procedures amid the pandemic. 

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

NextEra’s shares have gained +8.7% over the past three months against the Zacks Electric Power industry’s fall of -3.6%. The Zacks analyst believes that a slew of natural gas projects in the pipeline, robust renewable backlog, addition of renewable energy generation assets, acquisitions as well as adequate liquidity are likely to boost NextEra’s performance.

NextEra, through solid execution of organic expansion plans, is on course to achieve the long-term growth goal despite disruptions caused by the pandemic outbreak. The company carried strategic acquisitions amid this crisis, and has ample liquidity to meet its current debt obligations.

However, its nature of business is subject to complex and comprehensive federal, state, as well as other regulations. If the planned nuclear plant outages last longer or an unplanned outage occurs, the company’s operations and profitability might be hampered.

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

Other noteworthy reports we are featuring today include T-Mobile US (TMUS), Colgate-Palmolive (CL) and Workday (WDAY).

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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>>>