Today's Must Read
McDonald's (MCD) Sales Initiatives Bode well, High Costs Ail
Opdivo, Eliquis Drive Bristol-Myers (BMY) Amid Competition
Thursday, January 9, 2020
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 Novartis (NVS), McDonald's (MCD) and Bristol-Myers Squibb (BMY). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
The Zacks analyst believes that Novartis performance in the past year has been stellar on key drugs like Cosentyx and Entresto, contribution from Zolgensma, and the Xiidra acquisition.
The impending acquisition of The Medicines Company should broaden its portfolio. New launches like Piqray and Beovu should further boost performance in the upcoming quarters. However, price erosion in the United States has adversely impacted the generic business.
Recently, Novartis has restructured its business and spun off the eye-care unit, Alcon, to become a core drug-focused company. However, pipeline setbacks and generic competition for key drugs are concerning.
Shares of McDonald's have lost -2.8% in the past three months against the Zacks Restaurants industry's fall of -0.3%. The Zacks analyst believes that this weakness is attributable to lower-than-expected earnings in the preceding three quarters.
Furthermore, earnings estimate for current and next year have witnessed downward revisions of late. High labor costs and currency headwinds are added concerns. Its heightened focus on refranchising might cut capital requirements and facilitate EPS growth. However, various sales and digital initiatives as well as positive comps bode well.
The company’s increased focus on delivery and accelerated deployment of EOTF restaurants in the United States are commendable. McDonald’s has been regularly rewarding its shareholders through share repurchases and dividends. Additionally, the company is making efforts to drive growth in international markets.
Bristol-Myers Squibb's shares have gained +39% over the past six months against the Zacks Large Cap Pharmaceuticals industry's rise of +8%. The Zacks analyst believes that Bristol-Myers’ lead immuno-oncology drug, Opdivo, continues to drive growth.
Label expansion of the drug into additional indications should further boost the top line. Empliciti and Sprycel are also performing well on label expansion. Moreover, Bristol-Myers has presence in other core therapeutic areas, including immunoscience and cardiovascular. Blood thinner drug, Eliquis, is expected to drive growth, propelled by increased share in the NOAC market.
Meanwhile, the acquisition of Celgene Corporation should broaden the company’s oncology portfolio with the addition of blockbuster drug, Revlimid. However, concerns will rise once the drug loses patent protection. Moreover, the company is facing headwinds like stiff competition from other immuno-oncology drugs and pipeline setbacks.
Other noteworthy reports we are featuring today include CME Group (CME), Chubb (CB) and UBS Group (UBS).
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Director of Research
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>>>