Today's Must Read
Ibrance & Other Key Drugs to Drive Pfizer's (PFE) Sales
Strength in Molecular Testing Aids Abbott (ABT) Amid Pandemic
Friday, November 27, 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), Pfizer (PFE) and Abbott Laboratories (ABT). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
NVIDIA shares have vastly outperformed the Zacks General Semiconductor industry in the year-to-date period (+127.5% vs. +32.3%), which reflects the company's emergence as an AI and analytics powerhouse on top of its legacy GPU dominance.
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 Pfizer have lost -3.7% over the past year against the Zacks Large-Cap Pharmaceuticals industry’s gain of +3.3%. The Zacks analyst believes that the company’s strong portfolio of new drugs will lead to accelerated growth.
The Consumer Healthcare joint venture with Glaxo and the merger of Upjohn unit with Mylan has made Pfizer a smaller company with a diversified portfolio of innovative drugs and vaccines. The smaller Pfizer should see better revenue growth as the Lyrica loss of exclusivity (LOE) cliff will go away. Pfizer expects strong growth of key brands like Ibrance, Inlyta and Eliquis to drive sales.
The focus remains on whether the FDA grants Emergency Use approval to its COVID-19 vaccine candidate. However, coronavirus-related business disruption hurt sales in Q2 and Q3. The pace of recovery of COVID-19 impact is slower than expected. Meanwhile, currency headwinds and pricing pressure are other top-line headwinds.
Abbott shares have gained +16.8% over the past six months against the Zacks Medical Products industry’s rise of +7.2%. The Zacks analyst believes that the branded generics and international diabetes businesses should drive growth in the coming quarters. New product launches and acquisitions should boost sales further.
Abbott witnessed double digit organic sales growth and high teens EPS growth in the third quarter of 2020. The company has been seeing improvements in testing and procedure volumes across its hospital-based businesses.
At the same time, its consumer-facing businesses like diabetes care, nutrition and established pharmaceuticals (EPD), are catching up pace following an initial hiccup witnessed during the first few months of the pandemic. In the third quarter, Abbott launched Libre 2 in the United States and obtained CE Mark for Libre 3. In Europe, the company also launched Libre Sense Glucose Sport.
Other noteworthy reports we are featuring today include United Parcel Service (UPS), Eli Lilly (LLY) and ICICI Bank (IBN).
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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>>>