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Research Daily

Tuesday, February 5, 2019

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 Pepsico (PEP), Walt Disney Company (DIS) and Sanofi (SNY). 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 >>>

Pepsico’s shares have outperformed the Zacks Soft Drinks Beverages industry in the last six months (-3.6% vs. -6.5%). Earnings topped estimates in the last 11 quarters, while it delivered positive sales surprise in five of the last seven quarters. The improvement is mainly attributable to strong performances in international divisions, propelled by higher revenue growth in developing and emerging markets. Also, the company’s solid snacks division is boosting the performance.

However, concerns regarding strained margins continue to linger, owing to operating and commodity cost inflation. Higher costs from transportation and stepped-up advertising expense are likely to continue going ahead, which should weigh on margins.

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

Shares of Disney have gained 5.3% over the past year, outperforming the Zacks Media Conglomerates industry’s gain of 3.1% during the same period. Additionally, the company’s blockbuster performance at the box office bodes well.

Moreover, Disney’s top line is expected to benefit from the solid line-up of big budget movies slated to be released over the next 18 months. Notably, estimates have been stable over the past seven days ahead of the company's Q1 earnings release. The company has positive record of earnings surprise in the recent quarters.

However, Disney’s ongoing investments in its technology platform are expected to keep margins under pressure. Additionally, higher programming costs at ESPN remains a concern. Moreover, weakness in the Consumer Products & Interactive Media segment is a headwind. 

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

Sanofi’s shares have gained 3.2% in the last six months, outperforming the Zacks Large Cap Pharmaceuticals industry's increase of 1%. It has several new products in its portfolio and candidates in its pipeline that can boost long-term growth. In fact, Sanofi’s product launches are now delivering revenues greater than the loss of exclusivity impact.

Particularly, we are optimistic about Dupixent’s sales prospects, which could prove to be an important growth driver. The performance of the Vaccines and Consumer Healthcare units has also improved lately. However, headwinds include a bleak outlook for the Diabetes franchise, generic competition for many drugs and slower-than-expected uptake of core products like Praluent.

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

Other noteworthy reports we are featuring today include Enbridge (ENB), Diageo (DEO) and HCA Healthcare (HCA).

Zacks' Top 10 Stocks for 2019

In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-holds for the year?

Who wouldn't? Our annual Top 10s have beaten the market with amazing regularity. In 2018, while the market dropped -5.2%, the portfolio scored well into double-digits overall with individual stocks rising as high as +61.5%. And from 2012-2017, while the market boomed +126.3, Zacks' Top 10s reached an even more sensational +181.9%.

See Latest Stocks Today >>

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>>>

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