Today's Must Read
Robust North American Land Activity Boosts Halliburton (HAL)
Monster Beverage (MNST) Strong on TCCC Deal, Fx Woes Stay
Thursday, August 10, 2017
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 Eli Lilly (LLY), Halliburton (HAL) and Monster Beverage (MNST).These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Pharmaceutical stocks have been under pressure since last year on pricing and regulatory concerns and Eli Lily shares have been no different. That said, the stock has done modestly better than the peer group; it is up +12.2% year to date vs. +10.9% gain for the Zacks Pharma industry and +9.5% increase for the Zacks Medical sector as a whole. Lilly’s second-quarter 2017 results were strong with the company beating estimates on both counts.
The company also raised its sales and earnings outlook for the year. Lilly’s new products like Trulicity, Taltz, Basaglar, Cyramza, Jardiance and Lartruvo have been performing well and the trend is expected to continue. The Zacks analyst is encouraged by the fact that Lilly expects to launch 20 new products between 2014 and 2023, including at least two new indications/line extensions on an average every year.
However, Alimta will continue to be impacted by competition. Other headwinds include competition from immuno-oncology agents as well as loss of exclusivity for many drugs.
Oil-related stocks have been under pressure this year on stubborn global crude glut and Halliburton shares have been no different. That said, the stock has done better than the peer group; it is down -23.6% in 2017 vs. -31.2% loss for the Zacks Oil Field Services industry.
The world’s No. 2 oilfield-services provider reported strong Q2 profit thanks to improved utilization and pricing gains in North America. Halliburton's 12th consecutive quarterly beat was aided by cost saving initiatives. HAL is also set to gain from the Summit ESP buyout on account of the latter’s expertise in extending the life of shale wells.
However, pricing pressure across the international markets is likely to dampen investor confidence. Moreover, with the failure of the BHI acquisition, HAL had to book a massive $3.5 billion in breakup charges that stretched its balance sheet. Hence, the Zacks analyst thinks investors should wait for a better entry point before buying shares in HAL.
Monster Beverage’s shares have gained +17.4% year to date, outperforming the Zacks Soft Drink industry’s gain of +13.9% during the same period. Monster Beverage’s earnings missed expectations but increased.6% year over year on higher sales. The international segment posted strong results and looks well positioned for the days ahead.
The Zacks analyst likes the fact that the company has several new products lined up for the remaining of 2017 which are likely to boost sales. The company successfully launched or transitioned Monster Energy Drinks to Coca-Cola bottlers in a number of markets in the quarter and expects further transitions and launches in the second half of the year. However, operating expenses continue to rise. Results were also hurt by unfavorable currency rates which dented quarterly net sales.
Other noteworthy reports we are featuring today include Huntington Bancshares (HBAN), Wellcare Health (WCG) and Liberty Global (LBTYA).
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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>>>