Top Research Reports For AbbVie, American Express & Abbott
Zacks Investment Research | Oct 16, 2017 03:34AM ET
Monday October 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 AbbVie (ABBV), American Express (AXP) and Abbott (ABT). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
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AbbVie shares have gained +44.8% year to date, outperforming the Zacks Large Cap Pharmaceuticals industry, which has gained +18.3% over the same period. The Zacks analyst likes the strong performance of AbbVie’s key drug Humira which should continue to do well. Moreover, Imbruvica has multibillion dollar potential and AbbVie is exploring the possibility of label expansion into solid tumors and autoimmune diseases.
Meanwhile, AbbVie has promising pipeline with several pivotal data readouts and regulatory milestones due in the second half. Maviret, approved recently, has the potential to rejuvenate AbbVie’s struggling HCV franchise. However, though Humira is doing well, the company is concerned about the product’s long-term growth prospects, given potential biosimilar competition.
Viekira also faces intense pricing and competitive pressure in the HCV market. Estimates have gone up slightly ahead of the company’s Q3 earnings release. AbbVie has had a mixed record of earnings surprises in the recent quarters.
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Shares of American Express are up +55.1% over the last one year, outperforming the Zacks Financial Miscellaneous Services industry, which has gained +34% over the same period. The Zacks analyst likes its solid market position, strength in card business and significant opportunities from the secular shift toward electronic payments.
The company is gaining from investments made in growth opportunities over the last couple of years. Strategic initiatives focusing on the platinum card portfolio and OptBlue program will drive business volume. Cost reduction and return of significant capital to shareholders through dividend and share buyback are other positives.
The stock has seen the Zacks Consensus Estimate for current-year earnings being revised 0.5% upward over the last 90 days. However, an increase in provision for losses, foreign exchange volatility, loss of Costco (NASDAQ:COST) as a client and intense competition remain major near-term concerns.
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Buy-rated Abbott’s shares have gained +12.1% over the last three months, outperforming the Zacks Medical Products industry, which has gained +0.3% over the same period. Ahead of Abbott's third-quarter 2017 earnings result, the Zacks analyst likes the promising full year guidance which is indicative of brighter prospects ahead. In fact, the strong guidance is backed by the company’s expectations to gain more synergies from the St. Jude merger.
Overall, Abbott’s plan to expand in core therapeutic areas is cause for encouragement. Recently, the company's FreeStyle Libre Flash received the FDA approval. Also, the company has received FDA approval for magnetic resonance-conditional labeling for its Ellipse implantable cardioverter defibrillator recently.
On the flip side, Abbott’s sluggish pediatric business in China continues to dent growth. Management is also concerned about the economic problems in Venezuela that are expected to remain unresolved for some time.
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Other noteworthy reports we are featuring today include Emerson Electric (EMR), United Technologies (UTX) and VMWare (VMW).
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Mark Vickery
Senior Editor
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
Today's Must Read/h6
Featured Reports/h6
The Zacks analyst appreciates WestRock Company's strategy to grow through acquisitions to capitalize on the growing demand for corrugated packaging.
Per the Zacks analyst, declining comps and mall traffic as well as waning margins are concerns. However, Macy's price optimization, cost containment and omnichannel strategy may help lift performance.
Per the Zacks analyst, VMware is expected to benefit from the SAP partnership in the Internet of Things (IoT) market. However, stiff competition from Microsoft (NASDAQ:MSFT) is expected to hurt growth.
Per Zacks analyst, Fidelity's investment in mobile banking and innovative products such as PayNet and BuyWay keep it well poised for growth.
The Zacks analyst is bullish on Baxter's launch of DeviceVue, an asset tracking solution for hospitals. However, lower cyclophosphamide sales are likely to mar Baxter's bottom line in the near term.n
Per the Zacks analyst, Restaurant Brands' sales boosting initiatives like product launches and promotional offerings are likely to drive growth.
Per the Zacks analyst, Emerson is enjoying robust demand in global HVAC and refrigeration markets, higher optimization projects and MRO activity.
The Zacks analyst appreciates WestRock Company's strategy to grow through acquisitions to capitalize on the growing demand for corrugated packaging.
Per the Zacks analyst, declining comps and mall traffic as well as waning margins are concerns. However, Macy's price optimization, cost containment and omnichannel strategy may help lift performance.
Per the Zacks analyst, VMware is expected to benefit from the SAP partnership in the Internet of Things (IoT) market. However, stiff competition from Microsoft (NASDAQ:MSFT) is expected to hurt growth.
Per Zacks analyst, Fidelity's investment in mobile banking and innovative products such as PayNet and BuyWay keep it well poised for growth.
The Zacks analyst is bullish on Baxter's launch of DeviceVue, an asset tracking solution for hospitals. However, lower cyclophosphamide sales are likely to mar Baxter's bottom line in the near term.n
Per the Zacks analyst, Restaurant Brands' sales boosting initiatives like product launches and promotional offerings are likely to drive growth.
Per the Zacks analyst, Emerson is enjoying robust demand in global HVAC and refrigeration markets, higher optimization projects and MRO activity.
New Upgrades/h6
The Zacks analyst believes that KLA-Tencor's complete yield management solutions, including hardware, software and services, help to keep its revenues stable relative to other equipment suppliers.
The Zacks analyst believes that Marathon Petroleum's Speedway convenience store business will help in generating long-term returns for shareholders due to healthy merchandise margins.
The Zacks analyst is impressed by the company's efforts to reward shareholders. The possibility of higher military spending due to the North Korea tensions have boosted stocks like Harris.
The Zacks analyst believes that KLA-Tencor's complete yield management solutions, including hardware, software and services, help to keep its revenues stable relative to other equipment suppliers.
The Zacks analyst believes that Marathon Petroleum's Speedway convenience store business will help in generating long-term returns for shareholders due to healthy merchandise margins.
The Zacks analyst is impressed by the company's efforts to reward shareholders. The possibility of higher military spending due to the North Korea tensions have boosted stocks like Harris.
New Downgrades/h6
Per the Zacks analyst, susceptibility to high operating risks related to Brexit, availability of raw materials and technological obsolescence of products mar the profitability of United Technologies.
Per the Zacks analyst, Embraer might need to pay higher penalties that will bring further losses for it going forward. Again, to survive in a competitive space it may need to incur high costs.
High costs due to significant investments at its Ground unit and TNT Express integration expenses are limiting bottom-line growth. The TNT Express cyberattack also worries the Zacks analyst.
Per the Zacks analyst, susceptibility to high operating risks related to Brexit, availability of raw materials and technological obsolescence of products mar the profitability of United Technologies.
Per the Zacks analyst, Embraer might need to pay higher penalties that will bring further losses for it going forward. Again, to survive in a competitive space it may need to incur high costs.
High costs due to significant investments at its Ground unit and TNT Express integration expenses are limiting bottom-line growth. The TNT Express cyberattack also worries the Zacks analyst.
Zacks Investment Research
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