Today's Must Read
Interconnected Retail Strategy Aids Home Depot's (HD) Growth
Key Drugs Drive Merck's (MRK) Sales Amid Pandemic
Friday, May 7, 2021
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 JPMorgan Chase (JPM), The Home Depot (HD), and Merck (MRK). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Shares of JPMorgan have been standout performers lately, with the stock up +72.4% over the past year vs. +45.7% for the S&P 500 index. The Zacks analyst believes that branch openings in new regions, inorganic expansion efforts and a strong mortgage banking business are likely to keep supporting financials.
While the Fed's accommodative policy and near-zero rates are expected to hurt interest income and margins, gradual economic recovery will likely lead to a rise in demand for loans. Further, JPMorgan's impressive capital deployments reflect earnings strength and solid balance sheet.
The Home Depot shares have gained +24.9% over the last six months against the Zacks Retail Building Products industry’s gain of +24.2%. The Zacks analyst believes that the company’s interconnected retail strategy and underlying technology infrastructure have helped boost web traffic in fiscal 2020.
Meanwhile, broad-based strength across its businesses and geographies led to comparable sales growth in fourth-quarter fiscal 2020. The company also gained from strong growth in its Pro and DIY customer categories. However, it has been witnessing soft margins trend due to higher expenses. Also, negative product mix and pressures from higher transportation costs have been major headwinds.
Shares of Merck have gained +4.2% in the past three months against the Zacks Large Cap Pharmaceuticals industry’s gain of +3.3%. The Zacks analyst believes that Merck’s drugs like Keytruda, Lynparza and Bridion have been boosting sales. Keytruda sales have benefited from increasing usage in cancer immunotherapy.
Meanwhile, animal health and vaccine products remain core growth drivers. However, generic competition for several drugs and rising competitive pressure will continue to remain overhangs on the top line. Further, reduced wellness visits amid the pandemic have weighed on the sales of Merck’s physician-administered drugs and vaccines.
Other noteworthy reports we are featuring today include T-Mobile US (TMUS), Edwards Lifesciences (EW) and Twilio (TWLO).
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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>>>