Thursday, January 11, 2024

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 Roche Holding AG (RHHBY), Netflix, Inc. (NFLX) and NIKE, Inc. (NKE). 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 >>>

Shares of Roche have underperformed the Zacks Large Cap Pharmaceuticals industry over the past year (-2.1% vs. +18.7%). The company’s performance in 2023 has been impacted by lower COVID-19-product-related sales, which has significantly impacted its top line, even though the diagnostics base business and newer drugs maintain growth.

Sales are likely to be affected further by the expected nosedive in sales of COVID-19 products worth nearly CHF 4.5 billion. Competition from biosimilars for established cancer medicines like Avastin, MabThera/Rituxan and Herceptin also hurt sales.

Nevertheless, new drugs -- namely Ocrevus, Hemlibra, Evrysdi, Phesgo, Polivy and Tecentriq -- have put up a stellar performance. The uptake of its new eye drug, Vabysmo, has been outstanding. The company’s efforts to develop new drugs to combat the decline in legacy drugs are encouraging.

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

Shares of Netflix have outperformed the Zacks Broadcast Radio and Television industry over the past year (+44.9% vs. +19.6%). The company is benefiting from a growing subscriber base thanks to a robust portfolio. Crackdown on password-sharing and the introduction of paid sharing in more than 100 countries, which represents more than 80% of Netflix’s revenue base, is also expected to aid growth.

Netflix’s diversified content portfolio, which is attributable to heavy investments in the production and distribution of localized, foreign-language content, has been driving its growth prospects.

However, stiff competition in the streaming space from the likes of Apple, Amazon Prime Video, Disney+, Peacock and Paramount+ is a headwind. Netflix’s leveraged balance sheet and a higher streaming obligation are concerns. Additionally, unfavorable forex is expected to hurt operating income in the fourth quarter of 2023.

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

Shares of NIKE have declined -3.1% over the past six months against the Zacks Shoes and Retail Apparel industry’s decline of -5.7%. The company’s continued progress on Consumer Direct Acceleration strategy, compelling product innovation and digital leadership have been drivers.

This aided retail sales across Nike Direct and wholesale businesses in first-quarter fiscal 2024. The digital business has been gaining from robust consumer trends, including momentum in the NIKE mobile app led by improved traffic and increased member buying frequency. The company posted top and bottom-line growth in first-quarter fiscal 2024.

Backed by solid consumer momentum, a robust innovation pipeline and strong inventory, management provided solid outlook for fiscal 2024. However, NIKE has been witnessing gross margin pressures owing to the rising inflation. Elevated demand creation expenses lead to higher SG&A expense.

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

Other noteworthy reports we are featuring today include Honeywell International Inc. (HON), Uber Technologies, Inc. (UBER) and Prologis, Inc. (PLD).

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>>>