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Research Daily

Friday, June 3, 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 Roche Holding AG (RHHBY), Philip Morris International Inc. (PM), and HSBC Holdings plc (HSBC). 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 >>>

Roche shares have declined -4.2% over the past year against the Zacks Large Cap Pharmaceuticals industry’s gain of +23.6%, reflecting reduced demand for its COVID-19 medicines and diagnostics. The decline in sales of legacy drugs like Herceptin, Avastin and MabThera has also affected revenues and will drag the top-line further. Biosimilar competition for key drugs weighs on its performance. Competition is stiff for Tecentriq as well.

However, first quarter was good on the back of the diagnostics division, which maintained its stellar performance on demand for COVID-19 tests. Nevertheless, the pharmaceuticals business also remained stable and newer drugs continue to offset the decline in sales of legacy drugs, and also approval of new drugs should also boost the top line.

(You can read the full research report on Roche here >>>)

Philip Morris shares have gained +14.3% over the past year against the Zacks Tobacco industry’s gain of +16.5%. The Zacks analyst believes that the company has been benefiting from its pricing power, which aided its first-quarter 2022 results. The top and the bottom lines increased year on year. Strength in IQOS and the combustible business drove performance despite headwinds.  Pricing for combustible products rose more than 3% and by roughly 6% on excluding Indonesia. Strength in the reduced-risk products category has been benefiting the company for a while now.

However, the company has been facing supply-chain and regulatory hurdles in its Russian business, and has taken steps to scale down its operations in the region, due to the Ukraine war. The war has further disrupted the global supply chain and has increased the inflationary pressure in certain materials and services.

(You can read the full research report on Phillip Morris here >>>)

HSBC shares have outperformed the Zacks Banks - Foreign industry over the past year (+9.4 % vs. -5.2%). The Zacks analyst believes that a strong capital position, initiatives to strengthen digital capabilities, an extensive network and improvement in operating efficiency through business restructuring will likely keep aiding growth. Exiting from the U.S. and French retail banking operations are expected to help the company focus on Asia. In sync with this, the acquisition of AXA Singapore insurance assets will expand the company's business in the region.

Though initiatives to improve market share in the U.K. and China will continue to support financials, these might lead to a rise in expenses, which will likely hurt HSBC’s bottom line to an extent in the near term. Relatively lower interest rates across the globe (despite rate hike expectations) will likely continue to hamper revenues.

(You can read the full research report on HSBC here >>>)

Other noteworthy reports we are featuring today include Advanced Micro Devices, Inc. (AMD), QUALCOMM Incorporated (QCOM), and Lockheed Martin Corporation (LMT).
Sheraz Mian
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>>>

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