Monday, November 7, 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 Merck & Co., Inc. (MRK), ConocoPhillips (COP) and Adobe Inc. (ADBE). 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 >>>

Merck’s shares have outperformed the Zacks Large Cap Pharmaceuticals industry over the past year (+20.0% vs. +7.6%). The company’s drugs like Keytruda, Gardasil vaccine and Bridion have been driving sales. With continued label expansion into new indications & early-stage settings, Keytruda is expected to remain a key top-line driver.

Animal health and vaccine products are core growth drivers. Its new COVID oral antiviral pill, Lagevrio has become a key top-line driver in 2022. However, generic competition for several drugs and rising competitive pressure, mainly on the diabetes franchise, will continue to be overhangs on the top line.

There are concerns about Merck’s ability to grow its non-oncology business ahead of Keytruda’s loss of exclusivity later in the decade. Merck’s shares have outperformed the industry this year so far.

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

Shares of ConocoPhillips have outperformed the Zacks Oil and Gas - Integrated - United States industry over the past year (+74.2% vs. +72.0%). The company holds a bulk of acres in the unconventional plays of Eagle Ford shale, Permian Basin and Bakken shale. Significant opportunities are there for the firm in the Bakken Shale, where it owns about 750 undrilled locations that could provide access to huge reserves.

COP projects its 2022 production at 1.74 million barrels of oil equivalent per day (MMBoe/d), suggesting an increase from 1.6 MMBoe/d last year. COP’s balance sheet is significantly less leveraged than the industry it belongs to. Also, it approved a $20-billion increase in the existing share repurchase program to $45 billion.

However, COP is highly exposed to oil price fluctuations, which makes things challenging for the company. Also, it been generating lower dividend yield than the industry over the past few years. As such, the stock warrants a cautious stance.

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

Shares of Adobe have underperformed the Zacks Computer - Software industry over the past year (-57.1% vs. -37.2%). The company is facing headwinds for Digital Media segment due to the ongoing tensions between Russia and Ukraine conflict. Nevertheless, Adobe is benefiting from strong demand for its cloud products.

The company’s Creative Cloud, Document Cloud and Adobe Experience Cloud products are helping it drive top-line growth. Rising subscription revenues and solid momentum across the mobile apps remain major positives.

Growth in emerging markets, robust online video creation demand, strong Acrobat adoption and improving average revenue per user remain tailwinds. We remain optimistic about Adobe’s market position, compelling product lines, persistent innovation and solid adoption of Creative Cloud and Adobe marketing cloud.

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

Other noteworthy reports we are featuring today include Marsh & McLennan Companies, Inc. (MMC), Intercontinental Exchange, Inc. (ICE), and Monster Beverage Corp. (MNST).

Mark Vickery
Senior Editor

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>>>