Today's Must Read
Robust Industrial Products Revenues Buoy Union Pacific (UNP)
Strong Opdivo Growth to Boost Bristol-Myers (BMY)'s Top-Line
Wednesday, November 1, 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 AbbVie (ABBV), Union Pacific (UNP) and Bristol-Myers (BMY). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
AbbVie's shares have gained +44.1% year to date, outperforming the Zacks Large Cap Pharmaceuticals industry, which has gained +14.6% over the same period. AbbVie reported mixed Q3 results. While earnings beat estimates, revenues came in line. Humira and Imbruvica kept up the strong performance.
Meanwhile, AbbVie raised its earnings outlook for the year backed by a strong year-to-date performance. Despite new competition, it raised its long-term target for Humira sales based on strong demand trends for the drug.
The Zacks analyst stresses that the past 2-3 months have been strong for the company as it presented promising data from several pivotal studies, gained regulatory approvals in the U.S., Europe, and Japan for its competitive HCV medicine Mavyret and FDA approval for the sixth indication for Imbrivica and settled its Humira patent disputes with Amgen.
Also, several pivotal data readouts and regulatory milestones are expected in 2018. However, HCV sales continue to be hurt by intensifying competition.
Shares of Buy-rated Union Pacific have outperformed the Zacks Rail Transportation Industry as well as fellow railroad operator Kansas City Southern over the last three months. While the company has gained +13.1%, the industry in belongs to and Kansas City Southern have rallied +8.3% and +2.1%, respectively, so far this year.
Ushering in further good news, Union Pacific reported better-than-expected earnings per share and revenues in the third quarter of 2017. Results were aided by strong performances of the company's intermodal and industrial products units.
The Zacks analyst is impressed by the company's efforts to cut costs to drive its bottom line as well. Efforts to reward investors also raise optimism in the stock. However, declining coal revenues in the third quarter raise concerns. Automotive volumes also decreased due to sluggish vehicle production in the United States.
Strong Buy-rated Bristol-Myers shares have underperformed the broader market as well as the Zacks Large Cap Pharmaceuticals industry this year, gaining only +5.5% in the year-to-date period. Bristol-Myers reported mixed results for the third-quarter with earnings missed expectations although revenue beat on the same. The miss in earnings was attributable to lower gross margin which in turn was due to product mix and decline in virology business.
The Zacks analyst thinks the increase in earnings guidance is encouraging. The company’s blockbuster immuno-oncology Opdivo continues to perform well along with Eliquis and Orencia. The company is looking to expand Opdivo’s label further and recently won FDA approvals for liver and colorectal cancers which should boost performance.
The company is also looking to counter generic threat for its key drugs through deals and acquisitions. The company recently entered into a deal with AbbVie and Halozyme. However, Opdivo is currently facing competitive challenges in the United States. The virology business is also under pressure.
Other noteworthy reports we are featuring today include Xilinx (XLNX), Weyerhaeuser (WY) and Colgate (CL).
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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>>>