Today's Must Read
AbbVie (ABBV) U.S. Humira Demand Solid, Skyrizi, Rinvoq Shine
Broadcom (AVGO) Banks on Wireless Products & Acquisitions
Thursday, August 13, 2020
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 The Home Depot (HD), AbbVie (ABBV) and Broadcom (AVGO). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Home Depot shares have modestly outperformed the Zacks Retail Building Products industry year to date (+28.9% vs. +28.5%). The Zacks analyst believes that Home Depot’s interconnected retail strategy and underlying technology infrastructure have been more relevant amid the coronavirus crisis, delivering record web traffic for weeks without disruption.
The company quickly adapted to consumer needs providing contactless curbside pickup and other fulfillment services, adhering to the safety protocols. This helped boost comps performance across stores.
However, the bottom-line results reflected the impacts of higher costs to steer through the environment, particularly enhanced benefits to associates. Moreover, the company suspended its previously outlined guidance for fiscal 2020, citing the unprecedented impacts of the pandemic.
Shares of AbbVie have gained +1.7% over the past six months against the Zacks Large-Cap Pharmaceuticals industry’s rise of +1.6%. The Zacks analyst believes that sales erosion due to direct biosimilar competition to Humira in international markets is a big headwind. Also, the decline in HCV drug Mavyret’s sales is a concern.
AbbVie beat Q2 estimates for earnings and sales. AbbVie’s key drug, Humira continues to see strong demand trends in the United States. AbbVie has been successful in expanding labels of its cancer drugs, Imbruvica and Venclexta. It has an impressive late-stage pipeline.
It gained approvals for two new drugs with significant potential, Skyrizi and Rinvoq, in 2019. Both are off to a strong start. Allergan’s acquisition has diversified AbbVie’s revenue base into new therapeutic areas, enhancing its long-term growth potential.
Broadcom shares have gained +25.2% over the past three months against the Zacks Electronics - Semiconductors industry’s rise of +32.3%. The Zacks analyst believes that Broadcom is expected to benefit from robust adoption of Wi-Fi 6 in access gateway, and solid uptick of DSL and PON products.
Further, synergies from acquisitions of CA and Symantec’s enterprise security business are anticipated to bolster the company’s presence in infrastructure software vertical. It is also well poised to address the needs of rapidly growing technologies like IoT and 5G, backed by an expanding product portfolio.
However, increasing lead times remains an overhang. The company estimates semiconductor revenues in wireless domain to decline in fiscal third quarter as its “large North American mobile phone customer”, likely indicating Apple, delays ramp of next-generation smartphone. Also, a highly leveraged balance sheet adds to the woes.
Other noteworthy reports we are featuring today include QUALCOMM (QCOM), 3M (MMM) and Morgan Stanley (MS).
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
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>>>