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The Zacks Analyst Blog Highlights Broadcom, Novo Nordisk, ConocoPhillips, Smith-Midland Corp. and Tredegar
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For Immediate Release
Chicago, IL – September 26, 2024 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Broadcom Inc. (AVGO - Free Report) , Novo Nordisk A/S (NVO - Free Report) ConocoPhillips (COP - Free Report) , Smith-Midland Corp. (SMID - Free Report) and Tredegar Corp. (TG - Free Report) .
Here are highlights from Wednesday’s Analyst Blog:
Top Research Reports for Broadcom, Novo Nordisk and ConocoPhillips
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., Novo Nordisk A/S and ConocoPhillips, as well as two micro-cap stocks Smith-Midland Corp. and Tredegar Corp.. The Zacks microcap research is unique as our research content on these small and under-the-radar companies is the only research of its type in the country.
These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Broadcom's shares have outperformed the Zacks Electronics - Semiconductors industry over the year-to-date period (+58.9% vs. +31.6%). The company is benefiting from strong demand for its networking products. In second-quarter 2024, it witnessed strong demand for custom AI accelerators, AI networking solutions, Ethernet switching, optical lasers, thin dies, PCI Express switches and Network Interface Cards from hyperscale customers.
Its solutions are suitable for addressing the needs of an increasing AI workload and the growing need for fast networking in data centers. The acquisition of VMware has benefited Infrastructure software solutions. Its expanding clientele, which includes the likes of Alphabet and Meta Platforms, is noteworthy.
AVGO's strong partner base, including Arista Networks, Dell Technologies, Juniper and Supermicro, has been a key catalyst. AI revenues are now expected to be $12 billion for fiscal 2024.
Shares ofNovo Nordisk have outperformed the Zacks Large Cap Pharmaceuticals industry over the past year (+39.4% vs. +28.1%). The company's diabetes drugs Ozempic and Rybelsus and obesity drug Wegovy are performing well, fueled by increasing demand. Label expansions of the same in cardiovascular and other indications will likely boost sales.
It has been tackling the supply constraints of Wegovy by making serious investments in increasing its manufacturing capabilities. The drug is now indicated in the United States and the EU to also reduce heart risks, which is a huge boost. The positive recommendation in the EU for approval of Wegovy to treat heart failure is also encouraging.
However, the CRL for insulin icodec in the United States is a setback for the company. Intense rivalry in the obesity sector also threatens Novo Nordisk's market share. Patent expiry, pricing pressure across the diabetes market and the pipeline setbacks remain a woe.
ConocoPhillips's have underperformed the Zacks Oil and Gas - Integrated - United States industry over the past year (-7.6% vs. -6.8%). The company's significant dependence on crude oil makes it vulnerable to market fluctuations. On the cost front, inflationary pressures contribute to a projected 8.1% increase in production and operating expenses for the third quarter, thereby squeezing margins.
Nevertheless, ConocoPhillips is set to leverage its extensive untapped drilling locations in cost-effective and diverse upstream assets like Eagle Ford shale, Permian Basin and Bakken shale. The impending acquisition of Marathon Oil Corporation should boost ConocoPhillips' production capabilities and expand its regional footprint in these key regions.
It is strategically increasing its presence in the liquefied natural gas market to meet the growing energy transition demand toward a low-carbon future. ConocoPhillips' minimal debt exposure provides resilience during periods of low commodity prices.
Shares of Smith-Midland have outperformed the Zacks Building Products - Concrete and Aggregates industry over the past year (+85.6% vs. +28.3%). This microcap company with market capitalization of $192.07 million has demonstrated record revenue growth, driven by increased production volumes across its plants, especially for infrastructure-related projects. In the second quarter of 2024, revenues surged 34% year over year to $19.6 million, with a strong $59.2 million backlog supporting continued expansion.
The utility segment also showed robust growth, particularly in the Northern Virginia market. The company is strategically positioned with key infrastructure contracts and a solid financial footing, including $7.3 million in cash and a low debt-to-capitalization ratio.
However, concerns include revenue concentration, fluctuating demand in key product lines, exposure to inflation, operational risks and seasonal variability. Rising accounts receivable and the suspension of dividends could strain the company's cash flow and impact investor sentiment.
Tredegar's shares have outperformed the Zacks Chemical - Plastic industry over the past year (+37.0% vs. +19.2%). This microcap company with market capitalization of $248.82 million marked a notable recovery in the first half of 2024 by posting $15.9 million in net income from ongoing operations, a drastic rise from the previous year's $0.5 million. Enhanced operational efficiencies doubled the EBITDA in the PE Films segment to $17 million.
Streamlined costs helped achieve $72.1 million in EBITDA. Benefiting from favorable U.S. trade policies, Tredegar expects continued market share growth in aluminum extrusions, particularly from the construction sector. The strategic sale of the Terphane unit aligns with its focus on core areas, potentially generating $85 million for reinvestment. Continuous innovation, particularly in PE Films, targets high-tech packaging demands.
However, challenges persist with weak demand in Bonnell Aluminum's primary markets and economic sensitivity in non-residential construction, compounded by high financial leverage and a suspended dividend.
Since 2000, our top stock-picking strategies have blown away the S&P's +7.0 average gain per year. Amazingly, they soared with average gains of +44.9%, +48.4% and +55.2% per year.
Today you can access their live picks without cost or obligation.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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The Zacks Analyst Blog Highlights Broadcom, Novo Nordisk, ConocoPhillips, Smith-Midland Corp. and Tredegar
For Immediate Release
Chicago, IL – September 26, 2024 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Broadcom Inc. (AVGO - Free Report) , Novo Nordisk A/S (NVO - Free Report) ConocoPhillips (COP - Free Report) , Smith-Midland Corp. (SMID - Free Report) and Tredegar Corp. (TG - Free Report) .
Here are highlights from Wednesday’s Analyst Blog:
Top Research Reports for Broadcom, Novo Nordisk and ConocoPhillips
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., Novo Nordisk A/S and ConocoPhillips, as well as two micro-cap stocks Smith-Midland Corp. and Tredegar Corp.. The Zacks microcap research is unique as our research content on these small and under-the-radar companies is the only research of its type in the country.
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's shares have outperformed the Zacks Electronics - Semiconductors industry over the year-to-date period (+58.9% vs. +31.6%). The company is benefiting from strong demand for its networking products. In second-quarter 2024, it witnessed strong demand for custom AI accelerators, AI networking solutions, Ethernet switching, optical lasers, thin dies, PCI Express switches and Network Interface Cards from hyperscale customers.
Its solutions are suitable for addressing the needs of an increasing AI workload and the growing need for fast networking in data centers. The acquisition of VMware has benefited Infrastructure software solutions. Its expanding clientele, which includes the likes of Alphabet and Meta Platforms, is noteworthy.
AVGO's strong partner base, including Arista Networks, Dell Technologies, Juniper and Supermicro, has been a key catalyst. AI revenues are now expected to be $12 billion for fiscal 2024.
(You can read the full research report on Broadcom here >>>)
Shares ofNovo Nordisk have outperformed the Zacks Large Cap Pharmaceuticals industry over the past year (+39.4% vs. +28.1%). The company's diabetes drugs Ozempic and Rybelsus and obesity drug Wegovy are performing well, fueled by increasing demand. Label expansions of the same in cardiovascular and other indications will likely boost sales.
It has been tackling the supply constraints of Wegovy by making serious investments in increasing its manufacturing capabilities. The drug is now indicated in the United States and the EU to also reduce heart risks, which is a huge boost. The positive recommendation in the EU for approval of Wegovy to treat heart failure is also encouraging.
However, the CRL for insulin icodec in the United States is a setback for the company. Intense rivalry in the obesity sector also threatens Novo Nordisk's market share. Patent expiry, pricing pressure across the diabetes market and the pipeline setbacks remain a woe.
(You can read the full research report on Novo Nordisk here >>>)
ConocoPhillips's have underperformed the Zacks Oil and Gas - Integrated - United States industry over the past year (-7.6% vs. -6.8%). The company's significant dependence on crude oil makes it vulnerable to market fluctuations. On the cost front, inflationary pressures contribute to a projected 8.1% increase in production and operating expenses for the third quarter, thereby squeezing margins.
Nevertheless, ConocoPhillips is set to leverage its extensive untapped drilling locations in cost-effective and diverse upstream assets like Eagle Ford shale, Permian Basin and Bakken shale. The impending acquisition of Marathon Oil Corporation should boost ConocoPhillips' production capabilities and expand its regional footprint in these key regions.
It is strategically increasing its presence in the liquefied natural gas market to meet the growing energy transition demand toward a low-carbon future. ConocoPhillips' minimal debt exposure provides resilience during periods of low commodity prices.
(You can read the full research report on ConocoPhillips here >>>)
Shares of Smith-Midland have outperformed the Zacks Building Products - Concrete and Aggregates industry over the past year (+85.6% vs. +28.3%). This microcap company with market capitalization of $192.07 million has demonstrated record revenue growth, driven by increased production volumes across its plants, especially for infrastructure-related projects. In the second quarter of 2024, revenues surged 34% year over year to $19.6 million, with a strong $59.2 million backlog supporting continued expansion.
The utility segment also showed robust growth, particularly in the Northern Virginia market. The company is strategically positioned with key infrastructure contracts and a solid financial footing, including $7.3 million in cash and a low debt-to-capitalization ratio.
However, concerns include revenue concentration, fluctuating demand in key product lines, exposure to inflation, operational risks and seasonal variability. Rising accounts receivable and the suspension of dividends could strain the company's cash flow and impact investor sentiment.
(You can read the full research report on Smith-Midland here >>>)
Tredegar's shares have outperformed the Zacks Chemical - Plastic industry over the past year (+37.0% vs. +19.2%). This microcap company with market capitalization of $248.82 million marked a notable recovery in the first half of 2024 by posting $15.9 million in net income from ongoing operations, a drastic rise from the previous year's $0.5 million. Enhanced operational efficiencies doubled the EBITDA in the PE Films segment to $17 million.
Streamlined costs helped achieve $72.1 million in EBITDA. Benefiting from favorable U.S. trade policies, Tredegar expects continued market share growth in aluminum extrusions, particularly from the construction sector. The strategic sale of the Terphane unit aligns with its focus on core areas, potentially generating $85 million for reinvestment. Continuous innovation, particularly in PE Films, targets high-tech packaging demands.
However, challenges persist with weak demand in Bonnell Aluminum's primary markets and economic sensitivity in non-residential construction, compounded by high financial leverage and a suspended dividend.
(You can read the full research report on Tredegar here >>>)
Why Haven't You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +7.0 average gain per year. Amazingly, they soared with average gains of +44.9%, +48.4% and +55.2% per year.
Today you can access their live picks without cost or obligation.
See Stocks Free >>
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.