Today's Must Read
Qualcomm (QCOM) Rides on 5G Chip Momentum, Portfolio Depth
Novo Nordisk (NVO) Boasts a Strong Pipeline, Amidst Competition
Tuesday, December 8, 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 Alibaba Group Holding Limited (BABA), QUALCOMM Incorporated (QCOM) and Novo Nordisk AS (NVO). 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 >>>
Alibaba shares have gained +24.4% in the year-to-date period against the S&P 500’s rise of +14.8%, on the back of steady improvement in core commerce and strong cloud business. The Zacks analyst believes that Alibaba’s strengthening cloud business with its expanding customer base continues to drive its performance. Its New Retail strategy is also gaining momentum. This is aiding growth in Tmall Import, Hema fresh food grocery business and Intime Department Stores.
However, higher costs associated with new initiatives remain a major concern. Also, COVID-19 related economic uncertainties and macro headwinds in China are major concerns. In addition, rising competition from e-commerce players poses a risk.
QUALCOMM shares have outperformed the Zacks Wireless Equipment industry in the year to date period (+79.1% vs. +45.0%). The Zacks analyst believes that with the rollout of 5G technology, Qualcomm is benefiting from investments toward building a licensing program in mobile. The company is focused on retaining its leadership in the 5G chipset market and mobile connectivity. It resolved a dispute with Huawei and inked a new long-term patent license agreement, which augurs well for long-term revenues.
However, lower handset shipments due to the COVID-19 pandemic remain a near-term headwind. Qualcomm is expected to face softness in demand from China. Over the past years, the company’s margins have declined due to high operating and research and development expenses.
Shares of Novo Nordisk have gained +20.4% over the past year against the Zacks Large Cap Pharmaceuticals industry’s increase of +6.8%. The Zacks analyst believes that the company’s well-known drug Ozempic is off to a solid start and the launch of Rybelsus looks good. The label of Ozempic was further expanded by the Food and Drug Administration (FDA) to include a cardiovascular indication. Novo Nordisk has one of the broadest diabetes portfolios in the industry. Tresiba, Victoza, Ozempic, Xultophy and Saxenda maintain momentum for the company.
However, lower realized prices in the Unites States, loss of exclusivity for products in hormone replacement therapy and intensifying competition will affect sales. Moreover, the impact of COVID-19 will adversely affect the performance in the upcoming quarters.
Other noteworthy reports we are featuring today include General Motors Company (GM), The Boeing Company (BA) and Delta Air Lines, Inc. (DAL).
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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>>>