Today's Must Read
Strong Foothold in Emerging Markets to Aid Coca-Cola (KO)
AbbVie's (ABBV) Pipeline Solid, Key Launches Likely in Near Term
Tuesday, January 8, 2018
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 Visa (V), Coca-Cola (KO) and AbbVie (ABBV). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Visa’s shares have outperformed the Zacks Financial Transaction Services industry over the past year (+14.2% vs. +6.2%). The Zacks analyst thinks numerous strategic acquisitions and alliances, technology upgrades and effective marketing have paved the way for long-term growth and consistent revenue rise.
Visa is well poised to gain from the growing electronic payment processing and strong international business. The stock has seen the Zacks Consensus Estimate for current-year earnings being revised 0.3% upward over the last seven days. Nevertheless, high client incentives and operating expenses and foreign exchange volatility might put pressure on margins.
Shares of Buy-ranked Coca-Cola have outperformed the Zacks Soft Drinks Beverages industry in the past six months, (+5.7% vs. -9.4%), driven by a solid surprise trend, which continued in third-quarter 2018. It delivered better-than-expected earnings and sales in the third quarter, marking the sixth straight quarter of earnings beat and fifth consecutive sales beat.
The Zacks analyst thinks it has been gaining from the ongoing productivity efforts and disciplined growth strategies. The company’s strategy of introducing new products, alongside focus on lifting and shifting successful brands globally is aiding performance. It is also benefiting from the acceleration of sparkling soft drinks category through investment and innovation.
However, reported revenues and operating margins were hurt by new accounting standards and currency headwinds. Going forward, the company expects unfavorable currency to hurt revenues and operating margin in the fourth quarter and full-year.
Buy-ranked AbbVie’s shares have lost 6.9% in the past six months, underperforming the Zacks Large-Cap Pharmaceuticals industry's rally of +5.8%. However, the Zacks analyst likes the fact that AbbVie’s key drug, Humira has been performing well based on strong demand trends despite new competition.
Moreover, Imbruvica has multibillion dollar potential. Mavyret’s launch has also been stronger than expected. AbbVie has also been successful in expanding approvals for its cancer drugs, Imbruvica and Venclexta. AbbVie has an impressive late-stage pipeline comprising several products with multibillion-dollar potential expected to be launched in the near term.
Th company expects to launch more than 20 new products or line extensions of marketed drugs before Humira biosimilar competition begins in the U.S. in 2023. However, direct biosimilar competition to Humira in Europe from October can erode revenues in 2019. Nonetheless, estimates have gone up ahead of Q4 earnings. AbbVie has a positive record of earnings surprises in the recent quarters.
Other noteworthy reports we are featuring today include Johnson & Johnson (JNJ), QUALCOMM (QCOM) and Duke Energy (DUK).
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
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>>>