Top Analyst Reports For TOTAL S.A., Humana & Novo Nordisk
Zacks Investment Research | Nov 16, 2017 05:35AM ET
Thursday, November 16, 2017
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 TOTAL S.A. (TOT), Humana (HUM) and Novo Nordisk (CO:NOVOb) (NVO). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
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Shares of TOTAL S.A. have gained +7.3% year to date, outperforming the Zacks Integrated International Oil industry which has increased +2.5% over the same period. The company’s third- quarter earnings topped expectations on solid operational performance, steadily decreasing breakeven production costs, improvement in the realized prices of commodities and new project ramp ups.
The Zacks analyst likes TOTAL’s new start-ups and acquisitions, which are helping it to boost production. Its decision to acquire Maersk Oil for $7.45 billion will further strengthen its position globally as an oil and gas operator.
Going forward, the company will continue to benefit from its cost management initiatives. However, fluctuating commodity prices, operations in some politically troubled regions and increasing competition could impact the company’s profitability. Due to its global presence, it is also exposed to risks associated with doing business abroad.
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Shares of Humana have underperformed the Zacks Health Maintenance Organization industry over the last one year, gaining +15.4% vs. 38.8%. Humana’s third-quarter 2017 earnings not only beat expectations but improved year over year driven by lower share count.
The Zacks analyst likes Humana’s strong government business. Its top line has been witnessing an uptrend for past many years. Sufficient generation of cash flow has helped the company take up several capital deployment initiatives aimed at enhancing shareholders’ value.
Humana’s sound balance sheet and disciplined capital management remains a positive. Its strong fundamentals are likely to help the stock gain momentum going forward. However, the company's individual commercial business has remained a drag over past few years.
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Novo Nordisk's shares have outperformed the Zacks Large Cap Pharmaceuticals industry year to date (up +38.5% vs. +14.1%). Novo Nordisk’s earnings in third-quarter 2017 topped expectations but revenues missed the same. The Zacks analyst likes the company’s strong pipeline which mainly focuses on therapeutic proteins within insulin, GLP-1, blood clotting factors and human growth hormone.
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The company's Diabetes segment is driven by strong performance of drugs like Victoza, Tresiba, Saxenda and Xultophy among others. However, continued growth from Victoza and Tresiba as well as higher contributions from Saxenda and Xultophy will be partly offset by the impact of lower realized prices in the United States, loss of exclusivity for products in hormone replacement therapy, intensifying competition within the diabetes and biopharmaceutics markets and macroeconomic conditions in many markets under International Operations.
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Other noteworthy reports we are featuring today include Agilent (A), Target (TGT) and Xcel (XEL).
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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
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The Zacks analyst thinks that Albemarle is well placed to gain from expansion actions in its lithium unit, strong growth in the battery-grade lithium market and synergies of Rockwood Holdings buyout.
The Zacks analyst notes that heavy expenses on research and development, and selling, general and administrative activities are making margin expansion difficult for Agilent Technologies (NYSE:A).
New Upgrades
The Zacks analyst believes that Rowan's technologically advanced and versatile jack-up fleet will generate significant cash flow. Moreover, reducing debt strengthens the company's financials.
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New Downgrades
Per the Zacks analyst, due to seasonality of business, chances of Central Garden & Pet generating significant sales in fourth-quarter is low. Also, higher debt level may impact its credit worthiness.
Per the Zacks analyst, weak distillers-dried grains (DDG) margins due to vomitoxin-related woes will hurt Andersons' Ethanol Group. Oversupply in fertilizer industry may dent its Plant Nutrient group.
Per the Zacks analyst, Ubiquiti is facing issues with its sales channel and supply chain execution, which might hurt operations. Also, its Service Provider Technology segment is losing momentum.
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