Today's Must Read
NIKE's (NKE) Sales Gain on Improved Traffic & Digital Growth
Salesforce (CRM) Rides on Portfolio Strength and Buyouts
Zoestis' (ZTS) Products Boost Sales, Supply Issues A Concern
Thursday, March 16, 2023
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 Nike, Inc. (NKE), Salesforce, Inc. (CRM) and Zoetis Inc. (ZTS). 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 >>>
Shares of Nike have gained +10.2% over the past six month against the Zacks Shoes and Retail Apparel industry’s gain of +10.4%. The company gained from brand strength, robust consumer demand and an innovative product pipeline. Its Consumer Direct Acceleration strategy, along with robust performance in its digital and DTC businesses bode well.
Our Model estimates 5.5% revenue growth in fiscal 2023, with 13.2% growth on a currency neutral basis. However, Nike witnessed a decline in gross margin due to higher markdowns to liquidate inventory, increased freight and logistics costs, elevated input costs and currency headwinds.
The Zacks analyst expects soft gross margin and currency headwinds to continue hurting Nike results in the quarters ahead.
(You can read the full research report on NIKE here >>>)
Salesforce’s shares have outperformed the Zacks Computer - Software industry over the past six months (+19.7% vs. +10.6%). The company is benefiting from a robust demand environment as customers are undergoing a major digital transformation. The rapid adoption of its cloud-based solutions is driving demand for its products. Its sustained focus on introducing more aligned products as per customer needs is driving its top-line.
Continued deal wins in the international market is another growth driver. The acquisition of Slack would position the company to be a leader in enterprise team collaboration solution space and better compete with Microsoft’s Teams product. The Zacks analyst expects CRM’s revenues to grow at a CAGR of 11.2% through fiscal 2024-2026.
However, stiff competition and unfavorable currency fluctuations are concerns. Besides, challenging macroeconomic environment might hurt its growth prospects in the near-term.
(You can read the full research report on Salesforce here >>>)
Shares of Zoetis have outperformed the Zacks Medical - Drugs industry over the past six months (+4.0% vs. -5.4%). The company’s momentum continues on its innovative portfolio of pet care parasiticides, including Simparica Trio and dermatology products (Apoquel and Cytopoint). The recently launched chewable version of Apoquel has seen strong growth in sales.
The uptake of Librela and Solensia in Europe, its new monoclonal antibody (mAb) therapies for osteoarthritis pain in dogs and cats, is encouraging. The launch of innovative products bolstered the portfolio and should fuel growth.
However, the company continues to face supply challenges which remain a headwind, along with disease outbreaks in livestock, hurting product demands. Stiff competition from animal health business wings of pharma bigwigs, Merck and Bayer, remains a woe.
(You can read the full research report on Zoetis here >>>)
Other noteworthy reports we are featuring today include Canadian Natural Resources Ltd. (CNQ), Archer-Daniels-Midland Co. (ADM) and Trane Technologies plc (TT).
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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