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Top Analyst Reports for Bristol-Myers, Verizon & Canadian National Railway

Friday, November 4, 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 Berkshire Bristol-Myers Squibb Company (BMY), Verizon Communications Inc. (VZ) and Canadian National Railway Company (CNI). 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 >>>

Berkshire Bristol-Myers Squibb shares have outperformed the Zacks Medical - Biomedical and Genetics industry over the past year (+32.5% vs. -30.2%). The Zacks analyst believes that solid demand for blood thinner drug, Eliquis and the label expansion of Opdivo should maintain momentum. Eliquis is the leading oral anticoagulant drug and continues to experience growth in its market share.

The label expansion of Opdivo into indications for lung cancer, renal cancer and gastric cancer boosted sales. The recent approval of drugs added a new stream of revenues. Our estimates for BMY’s top line suggest a CAGR of around 1.2% over the next three years, driven by solid demand for legacy drugs and the approval of new drugs.

However, Revlimid, one of the top revenue generators, is facing sales decline year over year due to generic competition.

(You can read the full research report on Bristol-Myers Squibb here >>>)

Shares of Verizon Communications have underperformed the Zacks Wireless National industry over the past year (-28.5% vs. -15.8%). The company reiterated its soft guidance for 2022 due a to challenging macroeconomic environment. An intensely competitive market and hefty expenses on promotions and lucrative discounts to attract customers are likely to hurt profitability. Spectrum crunch with a saturated wireless market is a headwind.

However, Verizon reported relatively healthy third-quarter 2022 results with the bottom line and the top line beating the respective Zacks Consensus Estimate. It plans to accelerate the availability of the 5G Ultra-Wideband network with C-Band deployment, focusing on 5G mobility, nationwide broadband, mobile edge compute and business solutions.

It is offering various mix-and-match pricing in both wireless and home broadband plans. Customer-focused planning, disciplined engineering and continued network upgrades will likely augment its market position.

(You can read the full research report on Verizon Communications here >>>)

Canadian National Railway shares have declined -10.4% over the past year against the Zacks Transportation - Rail industry’s decline of -16.8%. The company is facing supply chain disruptions, network fluidity challenges and weak Canadian grain crops are hurting the company’s volumes. Escalating fuel prices amid the Russia-Ukraine war pose a threat to Canadian National's bottom line. The company’s weak liquidity position is an added concern.

However, Canadian National's efforts to reward its shareholders via dividends and buybacks are encouraging and highlight the company's financial strength. In January, the company announced a 19% dividend hike. Canadian National is also active on the share buyback front.

Strong cash flow generating-ability supports Canadian National's shareholder-friendly activities. The company is benefiting from strong freight demand and solid pricing. With this, management expects adjusted earnings to increase 25% year over year in the current year.

(You can read the full research report on Canadian National Railway here >>>)

Other noteworthy reports we are featuring today include Airbnb, Inc. (ABNB), DTE Energy Company (DTE), and First Republic Bank (FRC).

Sheraz Mian
Director of Research

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

Eliquis, Opdivo Fuel Bristol (BMY) Amid Generic Competition

Verizon (VZ) Rides on 5G Rollout, Customer-Focused Planning

Canadian National's (CNI) Dividends Support, Fuel Costs Hurt

Featured Reports

Airbnb (ABNB) Banks on Strong Nights & Experiences Bookings
Per the Zacks analyst, strengthening gross nights booked in non-urban areas, and recovery in both long-distance and cross-border travel are benefiting Airbnb's Nights & Experience bookings.

Solid Investments Aid DTE Energy (DTE), Weak Solvency Woes
Per the Zacks analyst, DTE Energy's investment in infrastructure and expansion projects tend to boost its long-term growth prospects. However, its weak solvency position remains a bottleneck.

Loan Growth Aid First Republic (FRC), Increasing Costs a Woe
Per Zacks Analyst, First Republic benefits from rise in loan balances driven by increased loan origination volumes. Yet, escalating expenses due to investment in digital initiatives remains a woe.

Quest Diagnostics (DGX) Base Business Grows, Total Sales Dip
The Zacks analyst is optimistic about Quest Diagnostics' robust base business growth across hematology and prenatal genetics. Yet, decline in total sales due to a drag in COVID-19 testing demand ails.

Allegion Americas Drives Allegion (ALLE), High Debt Hurts
Per the Zacks analyst, solid traction of Allegion's Allegion Americas segment, driven by strength in non-residential and electronics end markets, will drive its growth. High debt level is concerning.

KBR Benefits From Solid Project Execution Amid Competition
Per the Zacks analyst, KBR is gaining from its high-end and differentiated government business work, and solid technology and consulting services. Yet, significant competitive pressure raises concern.

Patterson-UTI (PTEN) to Gain from Strong Financial Position
The Zacks analyst likes Patterson-UTI's low debt-to-capitalization and ample liquidity but is worried over uncertainty surrounding the upstream spending outlook.n

New Upgrades

Zscaler (ZS) Benefits From Acquisitions & Product Refreshes
Per the Zacks analyst, Zscaler is benefiting from its strategic acquisitions like Smokescreen and Trustdome. Moreover, frequent product refreshes are helping it in gaining new customers.

Rise in Digital Subscribers to Lift NY Times' (NYT) Revenues
Per the Zacks analyst, The New York Times Company benefits from increase in digital subscribers. Management anticipates digital-only subscription revenues to rise 30-33% in fourth-quarter 2022.

Strong Automotive Insurance Vertical Drives EverQuote (EVER)
Per the Zacks analyst, EverQuote is set to grow on solid performance of automotive and other insurance marketplace verticals. Increasing consumer traffic and higher quote request volume are positives.

New Downgrades

Weakness in Residential Products' Unit Ails Generac (GNRC)
Per the Zacks analyst, Generac's performance is likely to pressured owing to installation capacity constraints. Also, stiff competition and supply chain constraints continue to be headwinds.

The Estee Lauder Companies' (EL) Margin Hurt by High Costs
Per the Zacks analyst, inflationary pressures are a concern for The Estee Lauder Companies gross margin. In the first quarter of fiscal 2023, its gross margin contracted 190 basis points to 74%.

Lincoln National (LNC) Weak on High Costs, Mortality Claims
Per the Zacks Analyst, a high benefits expense level can dampen dent the company's margins. Continued incidence of COVID-related mortality remains a concern.

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
Bristol Myers Squibb Company (BMY) : Free Stock Analysis Report
Verizon Communications Inc. (VZ) : Free Stock Analysis Report
DTE Energy Company (DTE) : Free Stock Analysis Report
Canadian National Railway Company (CNI) : Free Stock Analysis Report
First Republic Bank (FRC) : Free Stock Analysis Report
Airbnb, Inc. (ABNB) : Free Stock Analysis Report
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