Today's Must Read
Digital Transformation and Acquisitions Aid salesforce (CRM)
Cancer Drugs Push AstraZeneca's (AZN) Sales, Pipeline Solid
Tuesday, October 20, 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 NVIDIA (NVDA), salesforce.com (CRM) and AstraZeneca (AZN). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
NVIDIA shares have outperformed the Zacks General Semiconductor industry in the year to date period (+132% vs. +35.8%) on the back of a demand boost from the coronavirus-induced work-from-home and learn-at-home wave. It is also benefiting from strong growth in GeForce desktop and notebook GPUs, which is boosting gaming revenues.
Moreover, a surge in Hyperscale demand remains a tailwind for the company’s Data Center business. Expansion of NVIDIA GeForce NOW is expected to drive user base. Further, solid uptake of AI-based smart cockpit infotainment solutions is a boon.
Additionally, collaboration with Daimler-owned Mercedes-Benz is expected to further strengthen NVIDIA’s presence in the autonomous vehicles and other automotive electronics space. However, management expects COVID-19 pandemic to negatively impact near-term revenues by $100 million. Moreover, the U.S.-China trade war remains a key concern.
Shares of salesforce have gained +77.7% over the past year against the Zacks Computer Software industry’s rise of +47.1%. The Zacks analyst believes that Salesforce is benefiting from a robust demand environment as customers are undergoing a major digital transformation. The rapid adoption of its cloud-based solutions is driving demand for its products.
Salesforce’s sustained focus on introducing more aligned products as per customer needs is driving its top-line. Continued deal wins in the international market is another growth driver. Furthermore, the recent acquisition of Tableau positions the company to be a leader in business analytics for actionable results in everything from operations to HR.
However, stiff competition from Oracle and Microsoft is a concern. Besides, unfavorable currency fluctuations along with increasing investments in international expansions and data centers are an overhang on near-term profitability.
AstraZeneca’s shares have gained +5.1% over the past six months against the Zacks Large Cap Pharmaceuticals industry’s rise of +0.4%. The Zacks analyst believes that AstraZeneca’s diabetes franchise faces stiff competition while pricing pressure is hurting sales in the respiratory unit.
Nonetheless, AstraZeneca’s newer drugs, mainly cancer medicines, Lynparza, Tagrisso and Imfinzi, should keep driving revenues. Its pipeline is strong with abundance of catalysts lined up including data on COVID-19 vaccine candidate, AZD1222.
AstraZeneca has also engaged in external acquisitions and strategic collaborations to boost its pipeline while investing in geographic areas of high growth like China. Cost-cutting efforts should drive earnings. The company has a mixed record of earnings surprises in the recent quarters. Estimates movement has been mixed ahead of Q3 earnings release.
Other noteworthy reports we are featuring today include JPMorgan Chase (JPM), Chevron (CVX) and Charter Communications (CHTR).
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>>>