Wednesday, May 15, 2024

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 Broadcom Inc. (AVGO), Merck & Co., Inc. (MRK) and Airbnb, Inc. (ABNB). 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 >>>

Broadcom shares have outperformed the Zacks Electronics - Semiconductors industry over the year-to-date period (+24.2% vs. +13.0%) on the back of the company's AI leverage. In the first quarter of 2024, under its semiconductor segment, AI revenues quadrupled year over year to $2.3 billion despite sluggish enterprise and telcos end markets.

Broadcom now expects fiscal 2024 AI revenues of roughly $10 billion. Networking revenues are expected to rally 35% year over year, driven by the accelerating deployment of networking connectivity and the expansion of AI accelerators within hyperscalers.

It expects continued strong bookings at VMware will accelerate revenue growth through the rest of fiscal 2024. VMware revenues are expected to grow double-digit percentage sequentially through the rest of the fiscal year. However, it expects flat growth in wireless segment.

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

Shares of Merck have outperformed the Zacks Large Cap Pharmaceuticals industry over the year-to-date period (+18.8% vs. +15.7%). The company beat Q1 estimates for earnings and sales. Products like Keytruda and Gardasil have been driving sales.

With continued label expansion into new indications, particularly earlier-stage launches, Keytruda is expected to see continued growth. 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 >>>)
 

Airbnb shares have gained +7.7% over the year-to-date period against the Zacks Internet - Content industry’s gain of +9.8%. The company’s first-quarter 2024 results benefited from continuous improvements in Nights and Experiences Booked, owing to growing travel demand and the timing of the Easter holiday.

This, in turn, enabled Airbnb to witness a positive trend in its Gross Booking Value. Growing gross nights booked, owing to the solid momentum across non-urban areas and increased demand for urban and cross-border travel, remained positive. A modest increase in Average Daily Rate was a plus. Strong momentum in Airbnb app downloads is a tailwind.

However, greater volatility in travel demand due to macroeconomic uncertainties and rising competition in the online travel space is a headwind. The impacts of foreign exchange fluctuations are expected to hurt revenue growth in the near term.

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

Other noteworthy reports we are featuring today include Enbridge Inc. (ENB), ONEOK, Inc. (OKE) and PG&E Corporation (PCG).

Director of Research

Sheraz Mian

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>>>