Today's Must Read
ExxonMobil (XOM) Banks on Oil-Rich Offshore Guyana Assets
Keytruda to Remain Merck's (MRK) Key Top-Line Driver
Wednesday, September 27, 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 Alphabet Inc. (GOOGL), Exxon Mobil Corp. (XOM) and Merck & Co., Inc. (MRK). 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 Alphabet have outperformed the Zacks Internet - Services industry over the year-to-date period (+45.7% vs. +43.9%). The company’s strong cloud division is aiding substantial revenue growth. Moreover, expanding data centers will continue to bolster its presence in the cloud space. Further, major updates in its search segment are enhancing the search results.
Also, strong focus on innovation of AI techniques and the home automation space should aid business growth in the long term. Further, its deepening focus on wearables category remains a tailwind. Alphabet’s expanding presence in the autonomous driving space is contributing well. Its growing efforts to gain foothold in the healthcare industry are other positives.
However, sluggishness in the company’s Network advertisement business remains a headwind. Additionally, its growing litigation issues and increasing expenses are concerns.
(You can read the full research report on Alphabet here >>>)
Shares of Exxon Mobil have outperformed the Zacks Oil and Gas - Integrated - International industry over the year-to-date period (+8.2% vs. +6.2%). The company’s bellwether status and an optimal integrated capital structure that has historically produced industry-leading returns make it a relatively lower-risk energy sector play.
In Stabroek Block, located off the coast of Guyana, ExxonMobil has made many major discoveries that significantly improve its production outlook. The advantaged growth projects of Guyana have lower greenhouse gas intensity than most of the oil and gas-producing resources across the globe.
However, the firm’s dividend yield is lower than the composite stocks belonging to the industry. Thus, ExxonMobil is lagging its peers when it comes to shareholders’ returns. Also, it demonstrates a higher level of operational volatility than the broader market.
(You can read the full research report on Exxon Mobil here >>>)
Merck’s shares have gained +24.7% over the past year against the Zacks Large Cap Pharmaceuticals industry’s gain of +26.7%. The company’s products like Keytruda and Gardasil have been driving sales. With continued label expansion into new indications, particularly earlier-line launches, Keytruda is expected to remain a key top-line driver.
Animal health and vaccine products are core growth drivers. Merck boasts a strong cancer pipeline, including Keytruda, which should drive long-term growth. Merck is investing in M&A activity to strengthen its pipeline.
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.
(You can read the full research report on Merck here >>>)
Other noteworthy reports we are featuring today include Abbott Laboratories (ABT), Intuit Inc. (INTU) and NextEra Energy, Inc. (NEE).
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>>>