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Research Daily

Thursday, December 7, 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 AbbVie Inc. (ABBV), NIKE, Inc. (NKE) and BHP Group Ltd. (BHP). 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 >>>

AbbVie’s shares have outperformed the Zacks Large Cap Pharmaceuticals industry over the past six months (+8.6% vs. +4.9%). The company has several new drugs in its portfolio with the potential to drive the top line and make up for lost Humira revenues.

Newer products, Skyrizi and Rinvoq, are performing extremely well, bolstered by approval in new indications, which should support top-line growth in the next few years. The company has several early/mid-stage candidates that have potential to drive long-term growth.

Though revenues are expected to decline in 2023, AbbVie expects to return to robust sales growth in 2025. However, the company faces several near-term headwinds like Humira’s loss of exclusivity, increasing competitive pressure on Imbruvica and economic pressure on Juvederm sales.

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

Shares of NIKE have outperformed the Zacks Shoes and Retail Apparel industry over the past six months (+10.1% vs. +4.7%). Continued progress on Consumer Direct Acceleration strategy, compelling product innovation and digital leadership have been drivers for the company.

This aided retail sales across Nike Direct and wholesale businesses in first-quarter fiscal 2024. The digital business has been gaining from robust consumer trends, including momentum in the NIKE mobile app led by improved traffic and increased member buying frequency. The company posted top and bottom-line growth in first-quarter fiscal 2024.

Backed by solid consumer momentum, a robust innovation pipeline and strong inventory, management provided a solid outlook for fiscal 2024. However, NIKE has been witnessing gross margin pressures owing to the rising inflation. Elevated demand creation expenses lead to higher SG&A expenses.

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

Shares of BHP have gained +5.3% over the past six months against the Zacks Mining - Miscellaneous industry’s gain of +11.4%. The company’s fiscal 2024 iron ore production guidance is 254-264.5 Mt, indicating 1% year-over-year growth at the midpoint. Production of copper is expected to be 1,720-1,910 kt (5.7% year-over-year growth at the midpoint) and nickel at 77-87 kt (2.5%).

Iron ore prices have been low on weak demand in China. Hopes of a pickup in demand in China, owing to a fresh round of stimulus measures for boosting its struggling property sector have lifted prices lately. Going forward, iron ore prices will be supported by demand in the automotive sector, infrastructure and housing market.

Copper and nickel prices will be fueled by demand for electric vehicles. BHP’s investment in projects with a focus on future--
facing commodities like copper, nickel and potash will aid growth. Efforts to make operations more efficient through technology will aid earnings.

Other noteworthy reports we are featuring today include American Electric Power Co., Inc. (AEP) and Block, Inc. (SQ).

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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