Today's Must Read
New Drugs Boost Novartis (NVS) Amid Generic competition
Positive Budget Aids Boeing (BA) Amid Poor 737 Deliveries
Monday, June 8, 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 Mastercard (MA), Novartis (NVS) and Boeing Company (BA). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Mastercard’s shares have outperformed the Zacks Financial Transaction Services industry over the past year (+17.2% vs. +13.1%). The Zacks analyst believes that the company is gaining from shifts in payments from physical to digital. Investment in technology keeps it at the forefront of the rapidly-evolving payments industry.
Its solid capital position enables investment in business. However, escalating costs might put pressure on the margins. The company also cancelled its annual 2020 outlook for net revenue and operating expense growth due to coronavirus-induced business loss. Share buyback delays and low profitability are other woes.
However, the company has announced second-quarter 2020 operating metrics regarding switched volumes, switched transactions and cross-border payments, which reflected stabilization in business volumes. Mastercard is also witnessing buoyant demand for its Data & Analytics and Cyber solutions.
Shares of Novartis have lost -7.2% over the past six months against the Zacks Large-Cap Pharmaceuticals industry’s rise of +2.3%. The Zacks analyst believes that solid performance of key drugs like Cosentyx and Entresto, and contributions from Kisqali and gene therapy, Zolgensma, have also boosted performance in recent times.
Moreover, the company maintained its annual outlook even amid uncertainties related to the coronavirus pandemic. While the impact of forward purchasing will be reversed as the year progresses, these drugs and new launches like Piqray, Mayzent and Beovu should further boost sales.
The biosimilar portfolio also gains traction with new key approvals. However, price erosion in the United States has adversely impacted the generics business. Moreover, pipeline setbacks and generic competition are concerning.
Boeing shares have lost -9.6% over the past three months against the Zacks Aerospace & Defense industry’s rise of +4.5%. The Zacks analyst believes that increased U.S. defense budget should act as a growth catalyst for defense players like Boeing.
Although its commercial business outlook for the near term appears grim, over the long run, the jet maker holds immense growth prospects. The massive demand for commercial jets generates a strong demand for aviation services, which should bode well for this stock.
However, COVID-19 outbreak and grounding of the 737 MAX jets significantly impacted Boeing’s business. Particularly, lower 737 deliveries have been hurting its earnings and cash flow for past couple of quarters. Moreover, Airbus beat Boeing as the world’s largest plane maker, for the first time in last eight years in 2019.
Other noteworthy reports we are featuring today include Sanofi (SNY), International Business Machines (IBM) and Honeywell International (HON).
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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>>>