Friday, May 20, 2022
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 JPMorgan Chase & Co. (JPM), Gilead Sciences, Inc. (GILD) and CSX Corp. (CSX). 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 >>>
JPMorgan
shares have declined -24.2% in the year-to-date period against the Zacks Banks – Major Regional industry’s decline of -19.1%. The company’s first-quarter 2022 results show loan growth, the dismal performance of the capital markets business, and higher provisions.
The volatile nature of the trading business is likely to make fee income growth tough. Relatively lower interest rates in the near term are expected to keep weighing on the company’s margins and interest income. Steadily rising expenses remain a key near-term headwind.
However, Opening new branches, strategic acquisitions/investments, global expansion and digitization initiatives and decent investment banking (IB) pipeline are likely to keep aiding the company’s financials. Its steady capital deployments look sustainable and will enhance shareholder value.
(You can
read the full research report on JPMorgan here >>>
)
Gilead Sciences
shares have declined -3.7% over the past year against the Medical – Biomedical and Genetics industry’s decline of -37.7%. The Zacks analyst believes that the loss of Atripla and Truvada’s exclusivity is affecting sales. Although the CAR T cell therapy franchise, comprising Yescarta and Tecartus, is gaining traction, it has a long way to go before contributing meaningfully.
Never the less, the company’s flagship HIV therapy Biktarvy continues to register growth and gains in market share. It is looking to solidify its oncology franchise. The acquisition of Immunomedics added an approved drug Trodelvy to its portfolio, and the label expansion of the drug should boost sales. Increased contribution from the COVID-19 treatment, Veklury boosted performance. The recent surge in cases in many countries might drive sales further.
(You can
read the full research report on Gilead Sciences here >>>
)
CSX
shares have declined -5.5% over the past year against Transportation – Rail industry’s decline of -5.9%. The Zacks analyst believes that supply chain disruptions are hurting the company’s operations.
Weakness in the merchandise segment due to lower automotive volumes is concerning. High costs, primarily due to escalating fuel expenses, pose a threat to CSX’s bottom line. The company’s high capital expenditures are also worrisome. Due to these headwinds, shares of the company have lost 17.7% in the year-to-date period.
However, due to a healthy freight environment, CSX is benefiting from higher export coal volumes, domestic intermodal shipments, and favorable pricing. With the demand scenario expected to remain strong, management anticipates double-digit growth in operating income and revenues for 2022 from the respective year-ago reported figures. The company’s measures to reward shareholders are encouraging as well. In February, CSX hiked its dividend by 7.5%.
(You can
read the full research report on CSX here >>>
)
Other noteworthy reports we are featuring today include CVS Health Corp. (CVS), The Progressive Corp. (PGR), and China Petroleum & Chemical Corp. (SNP).
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
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
Branch Expansion Efforts Aid JPMorgan (JPM) Amid Low Rates
Biktarvy, Veklury Fuels Gilead (GILD) As Core Business Slows
Healthy Freight Demand Aids CSX Amid Supply Chain Woes
Featured Reports
CVS Health (CVS) Pharmacy Business Grows Amid Stiff Rivalry
The Zacks analyst is impressed with CVS Health’s growth in pharmacy revenues on higher pharmacy claims volume, rise in specialty pharmacy and brand inflation. Yet, stiff rivalry remains a concern.
Progressive’s (PGR) Solid Policies in Force Aid, Cat Loss Ail
Per the Zacks analyst, Progressive is set to grow on, solid policies in force, competitive rates and leadership position. However, cat loss exposure inducing underwriting volatility ails.
Sinopec (SNP) Banks on Shengli Geological Shale Oil Reserves
The Zacks analyst is impressed by Sinopec’s discovery of 458 million tons of shale oil reserves at its Shengli field, which will drive the production. Yet, rising exploration costs remain concerning.
Intercontinental (ICE) Banks on Buyouts & Solid Balance Sheet
Per the Zacks analyst, Intercontinental Exchange is set to grow on a number of acquisitions and cost synergies. Moreover, a solid balance sheet provides financial flexibility.
Solid Investments Aid Sempra Energy (SRE), Weak Solvency Woe
Per the Zacks analyst, systematic investments significantly boost Sempra Energy’s infrastructure and its customers reliability. However, its weak solvency position remains a concern
Synopsys (SNPS) Banks on Strong Product Menu, Contract Wins
Per the Zacks analyst, Synopsys’ focus on strengthening its product portfolio is helping it cater to the growing demand in the EDA market. Deal wins at leading semiconductor companies is a tailwind.
Ericsson (ERIC) Rides on Comprehensive 5G Portfolio Strength
Per the Zacks analyst, Ericsson is likely to benefit from its comprehensive 5G product portfolio as it focuses on structural changes to generate efficiency gains and boost cost competitiveness.
New Upgrades
Focus on Permian Basin, Cost Management Aid Occidental (OXY)
Per the Zacks analyst Occidental’s efficient cost management and expansion of its operation Permian Basin through acquisition of Anadarko will drive its performance over the long run.
Nutrien (NTR) Gains on Strong Demand and Higher Prices
Per the Zacks analyst, the company will gain from solid demand for fertilizers driven by the strength in global agriculture markets. Higher prices for crop nutrients will also support its margins.
Marriott (MAR) Likely to Gain From Robust Expansion Efforts
The Zacks analyst believes that Marriott’s efforts to expand its footprint and improving demand bode well. At the end of first-quarter 2022, Marriott’s development pipeline totaled nearly 2,878 hotels
New Downgrades
Walmart (WMT) Hurt by Cost Inflation, Supply-Chain Hurdles
Per the Zacks analyst, Walmart is battling supply-chain hurdles, and fuel and wage cost inflation. Walmart expects some of these woes to persist, and lowered earnings per share view for fiscal 2023.
Soft Hard Seltzer Ail Boston Beer’s (SAM) Performance
Per the Zacks analyst, Boston Beer has been reeling under slowed growth trends in hard seltzer for some time now. As a result, Q1 revenues declined 21.1% year over year.
Declining Sales, Rising Costs Irk Align Technology (ALGN)
The Zacks analyst is apprehensive about Align Technology’s declining clear aligner revenues. Also, escalating operating expenses are building significant pressure on the bottom line.
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 >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.
Click to get this free report
