Friday, February 2, 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 Eli Lilly and Co. (LLY), Danaher Corp. (DHR) and Citigroup Inc. (C). 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 >>>
Eli Lilly’s shares have outperformed the Zacks Large Cap Pharmaceuticals industry over the past year (+96.7% vs. +25.7%). The company’s revenue growth is being driven by higher demand for drugs like Verzenio, Trulicity, Taltz and others. Sales of its new drug, Mounjaro, are benefiting from strong demand trends.
Lilly is also making rapid pipeline progress in areas like obesity, diabetes and Alzheimer’s disease. Mounjaro was recently approved for the obesity indication by the name of Zepbound. Mounjaro and Zepbound are expected to be key top-line drivers for Lilly. The company has also gained approvals for some other new drugs in 2023.
However, generic competition for some drugs, rising pricing pressure and challenges in meeting strong demand for incretin products are some top-line headwinds. Estimates have declined slightly ahead of Q4 results. Lilly has a mixed record of earnings surprises in the recent quarters.
(You can read the full research report on Eli Lilly here >>>)
Shares of Danaher have outperformed the Zacks Diversified Operations industry over the past year (+3.3% vs. +2.4%). Stable demand in the academic and life science research markets is supporting Danaher’s Life Sciences segment. In the segment, the company has been witnessing positive responses toward its new products.
Its commitment to return value to shareholders is encouraging. Synergies from the Abcam acquisition bolster the company’s growth. Through its DBS initiatives, it has been able to reduce the impact of supply-chain constraints and inflationary pressures.
However, Danaher is plagued by weakness in the Biotechnology and Diagnostics segments due to a decrease in the sale of COVID-related products. The slowdown in the pharma and biopharma markets is an added concern. High debt levels, if not controlled, might raise the company's financial obligations and drain its profitability. Given its international exposure, forex woes are weighing on its top line.
(You can read the full research report on Danaher here >>>)
Citigroup’s shares have outperformed the Zacks Banks - Major Regional industry over the past year (+13.9% vs. +6.3%). The company’s fourth-quarter results witnessed growth in total loans and deposits. It is undergoing an organizational overhaul, which is expected to simplify operations.
The company remains on track to exit the consumer banking business in international markets and focus on growth in wealth management and commercial banking.
High interest rates will continue to aid net interest income (NII), though rising funding costs will weigh on it. However, escalating expenses will likely limit bottom-line growth. Fee income volatility remains a major headwind.
(You can read the full research report on Citigroup here >>>)
Other noteworthy reports we are featuring today include Shopify Inc. (SHOP), Boston Scientific Corp. (BSX) and Canadian Pacific Kansas City Ltd. (CP).
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>>>
Today's Must Read
New Buyouts Aid Boston Scientific (BSX), Rising Expenses Ail
The Zacks analyst is impressed with Boston Scientific strongly gaining from its strategic buyouts of Relievant Medsystems, Apollo Endosurgery and Acotec. Yet, rising expenses continue to dent growth.
Canadian Pacific KC (CP) Rides on Dividends Amid High Costs
The Zacks analyst is impressed with the company's efforts to reward its shareholders. However, elevated operating costs represent a headwind.
Phillips 66 (PSX) Banks on Strong Midstream Asset Portfolio
Per the Zacks analysts, Phillips 66's performance is driven by streamlining its portfolio of assets and investing in growing developments. However, high debt exposure represents a headwind.
Solid Demand for AI Servers Aids Dell Technologies (DELL)
Per the Zacks analyst, Dell is benefiting from strong demand for AI servers driven by ongoing digital transformation and heightened interest in generative AI applications.
Strong Demand & Acquisitions Aid Fortive's (FTV) Performance
Per the Zacks analyst, strong demand trends and acquisitions is driving Fortive's performance. Softness in Precision Technologies' segment coupled with leveraged balance sheet is concerning.
Backlog Aids Huntington Ingalls (HII) Amid Labor Shortages
Per the Zacks analyst, solid backlog count for Huntington Ingalls boosts its revenue growth prospects. Yet, the shipbuilding industry is facing labor shortages that might hurt the stock's performance
Growing Nursing Demand & Strategic Plans Aid Adtalem (ATGE)
Per the Zacks analyst, Adtalem is benefiting from growing demand trends for nursing and healthcare programs, thus, boosting enrollment growth. Also, Growth with Purpose strategy bodes well.
Product Rollouts & Growing Merchant Base Aid Shopify (SHOP)
Per the Zacks analyst, Shopify is benefiting from products like Shopify Shipping, Shopify Payments and Shopify Capital solutions. New merchant friendly applications are also driving growth.
Increase in New Insurance Written Aid MGIC Investment (MTG)
Per the Zacks analyst, MGIC Investment is poised to grow on higher insurance in force, improved direct premium yield, higher annual persistency, lower claims and a strong capital position.
Vista and National Pen Segments to Benefit Cimpress (CMPR)
Per the Zacks analyst, Cimpress will benefit from strength in the Vista unit, led by an increase in the customer count. Growth in the e-commerce channel within the National Pen unit also bodes well.
Rising Production & Operating Costs Ail ConocoPhillips (COP)
Increasing production and operating expenses amid an inflationary business environment is hurting ConocoPhillips' profit. Weakness in free cash flow also concerns the Zacks analyst.
Investment and Restructuring Costs Hurt ManpowerGroup (MAN)
Per the Zacks Analyst, escalation in costs due to investments in digital and restructuring activities is a barrier to ManpowerGroup's bottom-line growth.
Soft Demand & Adverse Price/Mix Concern Whirlpool (WHR)
Per the Zacks analyst, global demand softness and adverse price/mix have been hurting Whirlpool's sales, particularly in Europe and North America. Persistence of these trends may hurt 2024 performance
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.Free: See Our Top Stock and 4 Runners Up >>