Today's Must Read
Biktarvy, Veklury Fuels Gilead (GILD) As Core Business Slows
Healthy Freight Demand Aids CSX Amid Supply Chain Woes
Friday, May 20, 2022
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 & Co. (JPM), Gilead Sciences, Inc. (GILD) and CSX Corp. (CSX). 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 >>>
JPMorgan shares have declined -24.2% in the year-to-date period against the Zacks Banks - Major Regional industry’s decline of -19.1%. The company’s first-quarter 2022 results show loan growth, the dismal performance of the capital markets business, and higher provisions.
The volatile nature of the trading business is likely to make fee income growth tough. Relatively lower interest rates in the near term are expected to keep weighing on the company’s margins and interest income. Steadily rising expenses remain a key near-term headwind.
However, Opening new branches, strategic acquisitions/investments, global expansion and digitization initiatives and decent investment banking (IB) pipeline are likely to keep aiding the company's financials. Its steady capital deployments look sustainable and will enhance shareholder value.
Gilead Sciences shares have declined -3.7% over the past year against the Medical - Biomedical and Genetics industry’s decline of -37.7%. The Zacks analyst believes that the loss of Atripla and Truvada’s exclusivity is affecting sales. Although the CAR T cell therapy franchise, comprising Yescarta and Tecartus, is gaining traction, it has a long way to go before contributing meaningfully.
Never the less, the company’s flagship HIV therapy Biktarvy continues to register growth and gains in market share. It is looking to solidify its oncology franchise. The acquisition of Immunomedics added an approved drug Trodelvy to its portfolio, and the label expansion of the drug should boost sales. Increased contribution from the COVID-19 treatment, Veklury boosted performance. The recent surge in cases in many countries might drive sales further.
CSX shares have declined -5.5% over the past year against Transportation - Rail industry’s decline of -5.9%. The Zacks analyst believes that supply chain disruptions are hurting the company’s operations.
Weakness in the merchandise segment due to lower automotive volumes is concerning. High costs, primarily due to escalating fuel expenses, pose a threat to CSX’s bottom line. The company’s high capital expenditures are also worrisome. Due to these headwinds, shares of the company have lost 17.7% in the year-to-date period.
However, due to a healthy freight environment, CSX is benefiting from higher export coal volumes, domestic intermodal shipments, and favorable pricing. With the demand scenario expected to remain strong, management anticipates double-digit growth in operating income and revenues for 2022 from the respective year-ago reported figures. The company’s measures to reward shareholders are encouraging as well. In February, CSX hiked its dividend by 7.5%.
(You can read the full research report on CSX here >>>)
Other noteworthy reports we are featuring today include CVS Health Corp. (CVS), The Progressive Corp. (PGR), and China Petroleum & Chemical Corp. (SNP).
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>>>