Today's Must Read
salesforce (CRM) Rides on Portfolio Strength and Acquisitions
Strong Diabetes Portfolio Boost Novo (NVO) Amid Competition
Friday, March 20, 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 Microsoft (MSFT), salesforce.com (CRM) and Novo Nordisk (NVO). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Microsoft’s shares have outperformed the S&P 500 over the past six months (+4.1% vs. -18.9%). The Zacks analyst believes that Microsoft is benefiting from growing user base of its different applications like Office 365 commercial, Dynamics, Outlook mobile and Teams.
Moreover, Azure’s expanding customer base is a key catalyst. Markedly, the ongoing expansion in Microsoft Teams’ subscriber base is strengthening the company’s competitive position in the enterprise communication market against Slack and Zoom. Furthermore, the company is well poised to widen the total addressable market through acquisitions of GitHub and PlayFab.
However, management doesn’t expect to meet its previous third-quarter fiscal 2020 projection for More Personal Computing segment revenues due to the coronavirus outbreak in China. This, in turn, raises investors’ concerns, at least in the near term.
Shares of salesforce.com have lost 15.9% over the past year against the Zacks Computer Software industry’s rise of 2%. The Zacks analyst believes that Salesforce has been benefiting from a robust demand environment as customers are undergoing a major digital transformation.
The rapid adoption of its cloud-based solutions is driving demand for its products. Continued deal wins in the international market is another growth driver. Furthermore, Salesforce’s recent acquisition of Tableau positions the company to be a leader in business analytics for actionable results in everything from operations to HR.
However, stiff competition from Oracle and Microsoft is a concern. Besides, increasing investments in international expansions and data centers are an overhang on near-term profitability.
Novo Nordisk’s shares have lost 10% over the past three months against the Zacks Large Cap Pharmaceuticals industry’s fall of -18.2%. The Zacks analyst believes that a solid performance from Tresiba, Victoza, Ozempic, Xultophy and Saxenda maintains momentum for the company.
Ozempic, a once-weekly GLP-1, continues to gain market share. The label of Ozempic was further expanded by the FDA to include a cardiovascular indication. Rybelsus was recommended for approval for treatment of adults with type II diabetes by the European regulatory authorities and a potential approval will boost sales.
Label expansion of existing drugs will further boost sales for the company. However, lower realized prices in the Unites States, loss of exclusivity for products in hormone replacement therapy and intensifying competition will adversely impact sales.
Other noteworthy reports we are featuring today include NextEra Energy (NEE), American Express (AXP) and Fiserv (FISV).
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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>>>