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Top Research Reports for Alphabet, Eli Lilly & CVS Health

Mark Vickery

Tuesday, May 14, 2019

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 Alphabet (GOOGL), Eli Lilly (LLY) and CVS Health (CVS). 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 >>>

Alphabet’s shares have gained +4.8% in the past one year, outperforming the Zacks Internet Services industry's decline of -7.9%. Alphabet reported weak revenues in the first quarter due to increasing competition in the advertising business, currency fluctuations and a few changes in YouTube ads.

However, the Zacks analyst thinks strong initiatives toward elimination of bad ads and introducing useful major search updates are acting as tailwinds. Further, Google’s robust mobile search is also a major positive.

Additionally, its strong focus toward bolstering presence in the cloud market on the back of expanding data centers and robust cloud offerings continues to aid growth. Google’s strong focus on the innovation of its AI techniques and home automation space is aiding its business growth. However, the company’s growing litigation issues and increased spending on YouTube and consumer gadgets might hurt its profitability.

(You can read the full research report on Alphabet here >>>).

Shares of Eli Lilly have gained +39.1% in the past year, significantly outperforming the Zacks Large Cap Pharmaceuticals industry, which has gained +6% over the same period. Lilly beat estimates for earnings in the first quarter. However, Lilly lowered its sales guidance for 2019. 

The Zacks analyst thinks revenue growth in 2019 will likely be driven by higher demand for its newer drugs including Trulicity, Jardiance, Taltz, Verzenio and new migraine drug, Emgality as some older drugs like Cialis face generic competition. Lilly has made significant pipeline progress in the past year with several positive late-stage data readouts, multiple approvals and regulatory submissions. Lilly also added promising new pipeline assets through business development deals.

However, competitive pressure on Lilly’s drugs is expected to rise in 2019. Generic competition for several drugs including Cialis, rising pricing pressure, currency headwinds and the impact of the failed Lartruvo study are expected to put pressure on the top line.

(You can read the full research report on Eli Lilly here >>>).

CVS Health’s shares have outperformed the Zacks Retail Pharmacies and Drug Stores industry in the past three months, losing -22.6% versus -24.6%. CVS Health ended first quarter 2019 on a promising note with both earnings and revenues trumping expectations.

Year-over-year growth in the top line was driven by a strong Pharmacy Services segment, benefiting from the upside in the specialty services. The Zacks analyst thinks that although the company is witnessing certain challenges related to 2020 PBM selling season, the long-term prospects look bright. This apart, Aetna integration synergy looks promising.

Following this, CVS Health introduced a new segment-Health Care Benefits which holds immense promise. On the flip side, during the first quarter, persistent reimbursement pressure and the impact of recent generic introductions dented the company’s retail LTC business growth. Also, Omnicare business performance should continue to remain soft through 2019 impacting CVS' pharmacy services arm.

(You can read the full research report on CVS Health here >>>).

Other noteworthy reports we are featuring today include Intercontinental Exchange (ICE), Marriott (MAR) and TELUS (TU).

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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 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

Alphabet (GOOGL) Rides on Diversification, Legal Troubles Ail

New Drugs to Drive Lilly's (LLY) Sales Amid Generic Pressure

CVS Health's (CVS) Aetna Prospect Bright, PBM Challenges Remain

Featured Reports

Rising Revenues, Buyouts Aid Intercontinental Exchange (ICE)

Per the Zacks analyst, numerous acquisitions made by the company have diversified its business, added scale, size and product suite and have paved path for consistent revenue growth.

Marriott (MAR) Rides on Robust North-America Business

The Zacks analyst believes that solid North-America business along with domestic and international expansion plans will consistently boost Marriott's performance.

Subscriber Additions to Drive TELUS (TU) Amid Wireline Woes

Per the Zacks analyst, TELUS is well poised to benefit from robust network and equipment businesses on the back of increased customer base.

Match Group (MTCH) Rides on Tinder Adoption Amid High Debt

Per the Zacks analyst, robust momentum at Tinder and solid performances from Meetic, Match & PlentyOfF is a key catalyst.

HCP Inc. (HCP) to Grow on Portfolio-Repositioning Efforts

Per the Zacks analyst, portfolio-repositioning moves to improve the quality of its senior housing portfolio and operator mix bode well.

Investments Aid CenterPoint (CNP), Lower Credit Ratings Ail

Per the Zacks analyst, solid investments to expand operations should enable CenterPoint to meet increasing electricity demand.

Strategic Initiatives Aid Aon (AON), Rising Debts Hurt

Per the Zacks analyst, a number of acquisitions and collaborations have helped Aon enhance its capabilities, which has in turn improved its bottom-line.

New Upgrades

ADP Rides on Strategic Business Moves, Strong Balance Sheet

The Zacks analyst likes ADP's dominant position in the payroll processing and HCM market. While buyouts act as a key growth catalyst, a strong balance sheet allows it to enhance shareholder wealth.

Permian Focus to Fuel Parsley's (PE) Output Growth

Per the Zacks analyst, Parsley's strong inventory of drilling locations in the low-cost-high-return Permian Basin poise it for robust production growth and cash flow generation going forward.

Transformation Plan Bodes Well For Universal Technical (UTI)

Per the Zacks analyst, Universal Technical is poised to gain from its multiyear transformation plan, new campus and program initiatives.

New Downgrades

Weakening Steel Prices, Outages Weigh on U.S. Steel (X)

The Zacks analyst thinks that lower U.S. steel prices will dent the company's earnings. Higher maintenance outage costs will also hurt profitability in its Flat-Rolled segment.

Weak Opto Products, Normalizing Backlogs Hurt Vishay (VSH)

Per the Zacks analyst, declining inventories in Optoelectronics product segment are hurting Vishay Intertechnology. Also, supply acceleration which is impacting its backlogs remain a major concern.

Low Cigarette Volumes to Hurt Philip Morris' (PM) Revenues

Per the Zacks analyst, Philip Morris grapples with soft cigarette shipment volumes, stemming from regulatory hurdles. Notably cigarette volumes are expected to decline in the range of 1.5-2% in 2019.

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TELUS Corporation (TU) : Free Stock Analysis Report
Marriott International (MAR) : Free Stock Analysis Report
Eli Lilly and Company (LLY) : Free Stock Analysis Report
Intercontinental Exchange Inc. (ICE) : Free Stock Analysis Report
Alphabet Inc. (GOOGL) : Free Stock Analysis Report
CVS Health Corporation (CVS) : Free Stock Analysis Report
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