Tuesday, September 25, 2018

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 Johnson & Johnson (JNJ), Visa (V) and Verizon (VZ). 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 >>>

Johnson & Johnson’s shares have underperformed the Zacks Large Cap Pharmaceuticals industry year to date, gaining +0.6% vs. +6.7%. However, J&J’s sales growth has accelerated since second half of 2017 backed by higher sales in the Pharmaceutical unit and improving performance in Medical Devices unit. J&J has already raised its full-year organic sales growth expectations twice this year.

Though quite a few key products in J&J’s portfolio like Remicade and Concerta are facing generic competition, the Zacks analyst thinks new products in all segments, successful label expansion of cancer drugs like Imbruvica and Darzalex and contribution from recent acquisitions will continue to drive top-line growth.

J&J also enjoys a robust multi-year pipeline of new drugs and line extensions. Meanwhile, share buybacks and restructuring initiatives should provide bottom-line support. Headwinds like generics, pricing pressure, sluggish growth in the Consumer unit and soft global market conditions remain.

(You can read the full research report on Johnson & Johnson here >>>).

Shares of Buy-ranked Visa have outperformed the Zacks Financial Transaction Services industry over the past year (+44.9% vs. +38.7%). The Zacks analyst thinks the company is witnessing growth in payments volume, cross-border volume and processed transactions owing to a strong economy and positive consumer sentiment driving higher spending.

Numerous strategic acquisitions and alliances, technology upgrades and effective marketing have paved the way for long-term growth and consistent revenue rise. Visa is well poised to gain from the growing electronic payment processing and a strong international business.

Given solid operational performance, management expects fiscal 2018 operating EPS to grow in low-30s on low double digits revenue growth. A solid balance sheet ensures effective capital deployment. Nevertheless, high client incentives might put pressure on revenues.

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

Buy-ranked Verizon’s shares have gained +8.1% over the past year, outperforming the Zacks Wireless National industry’s loss of -2.7% during the same period. Verizon expects healthy improvement in margins on the back of strong FiOS network and strategic services in the Wireline business.

The company plans to launch next-generation 5G wireless residential broadband services in three to five U.S. markets in 2018. The Zacks analyst thinks focus on online content delivery, mobile video and online advertising will drive growth. Aggressive expansion in fiber optics network also augurs well.

Verizon has already started upgrading the aging copper network infrastructure of Boston and Sacramento with fiber and wireless network to support high-end mobile and wireline services for smart city, residential and business applications. However, the company continues to struggle in a highly competitive and saturated wireless market, where spectrum crunch has become a major issue, reducing its profitability to some extent.

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

Other noteworthy reports we are featuring today include Alphabet (GOOGL), NIKE (NKE) and Altria (MO).

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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>>>