Top Research Reports for Amgen, ServiceNow & RTX
Wednesday, October 4, 2023
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 Amgen Inc. (AMGN), ServiceNow, Inc. (NOW) and RTX Corporation (RTX). 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 >>>
Amgen shares have outperformed the Zacks Medical - Biomedical and Genetics industry over the year-to-date period (+2.0% vs. -17.5%). The company expects strong sales growth of products like Tezspire, Evenity, Repatha, Prolia and Tavneos to be offset by lower revenues from oncology biosimilars and legacy established products such as Enbrel in the future quarters.
The addition of Horizon Therapeutics, if successfully closed, will enhance Amgen’s growth prospects. Amgen also has some key pipeline assets in obesity and inflammation, which are indications that can have a large market opportunity. Several data readouts are expected in the next 12 months.
However, increased pricing headwinds and competitive pressure are hurting sales of many products, including some biosimilars. Weakness in some key brands like Otezla and Lumakras create potential revenue headwinds.
(You can read the full research report on Amgen here >>>)
Shares of ServiceNow have outperformed the Zacks Computers - IT Services industry over the year-to-date period (+39.4% vs. +15.4%). The company has been benefiting from the rising adoption of its workflows by enterprises undergoing digital transformation. It had 1724 total customers with more than $1 million in annual contract value at the end of the second quarter.
ServiceNow’s expanding global presence, solid partner base and strategic buyouts are positives. New solutions — Automated service suggestions, Service Request Playbook and Workplace Scenario Planning — are helping it win new customers.
Expanding portfolio with new generative AI solutions is expected to drive top-line growth. Strategic alliances with the likes of Microsoft remain tailwinds. However, ServiceNow is suffering from high inflation, unfavorable forex, stiff competition, and a challenging macro-economic environment.
(You can read the full research report on ServiceNow here >>>)
Shares of RTX have underperformed the Zacks Aerospace - Defense industry over the year-to-date period (-28.8% vs. -18.1%). The appreciating U.S. dollar has been burdening airlines, which may hurt the stock. Also, removals and inspections of engines from A32neo might increase costs for RTX. It may also be affected if China enforces its announced sanctions against RTX’s missile and defense unit.
However, thanks to its wide range of combat-proven defense products, RTX Corporation continues to receive ample orders from the Pentagon and its foreign allies. A steady recovery in commercial air traffic is boosting commercial OEM as well as commercial aftermarket sales for RTX.
Looking ahead, the company expects global air traffic to fully recover to 2019 levels post 2023 and its commercial aircraft volume growth to be up around 20% in 2023. The stock holds a solid solvency position.
(You can read the full research report on RTX here >>>)
Other noteworthy reports we are featuring today include Automatic Data Processing, Inc. (ADP), Petróleo Brasileiro S.A. - Petrobras (PBR) and Canadian Pacific Kansas City Limited (CP).
Director of Research
Sheraz Mian
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
Amgen (AMGN) Makes Rapid Progress on Solid Pipeline
Growing Customer Base & Partnerships Aid ServiceNow (NOW)
Rising Air Traffic Aids Raytheon (RTX) Amid Inflation Woes
Featured Reports
Solid Business Model Aids ADP, Escalating Expenses Hurt
The Zacks Analyst is positive about ADP's business model that ensures high recurring revenues, good margins, robust client retention and low capital expenditure. Rising expenses remain a concern.
Canadian Pacific KC (CP) Rides on Dividends Amid High Costs
The Zacks analyst likes the shareholder-friendly measures adopted by the company. However, rising operating expenses are concerning as they are likely to keep the bottom line under pressure.
Brand Building Boosts Constellation Brands' (STZ) Market Share
Per the Zacks analyst, Constellation Brands' consistent focus on brand building and inclusion of new products are key revenue drivers. This helped it boost market share, mostly in U.S. beer category.
Solid Backlog Aids Rockwell Automation (ROK) Amid Cost Woes
Per the Zacks analyst, Rockwell Automation is gaining from its solid backlog levels despite elevated material costs. Focus on productivity will also drive margins.
Digital Marketing to Aid Lennar (LEN), Higher Costs Ail
Per the Zacks analyst, Lennar is poised to benefit from dynamic pricing model and operating efficiency. However, rising land and labor costs are concerns.
Expanding Clientele, Hybrid-Working Solutions Aids Zoom (ZM)
Per the Zacks analyst, Zoom is benefiting from solid adoption of hybrid working solutions and expanding subscribers base.
Voya Financial (VOYA) Benefits From Investment Management
Per the Zacks analyst, solid performance at the Investment Management segment backed by increased investment capital revenues and higher fee-based margin has been driving revenue growth at Voya.
New Upgrades
Petrobras (PBR) Benefits from Brazil's Pre-Salt Reserves
The Zacks analyst thinks Petrobras' stakes in Brazil's lucrative pre-salt oil reservoirs should help the company to increase its production and improve its earnings outlook.
Pinterest (PINS) Rides on Growing User Engagement, AI Focus
Per the Zacks analyst, increasing engagement among Gen Z users, healthy traction in emerging verticals and integration of advanced AI to improve personalization will likely boost Pinterest's margins.
Growing Demand in Aerospace Segment Benefits Woodward (WWD)
Per the Zacks analyst, Woodward's performance benefits from solid demand in the aerospace segment due to higher commercial OEM. Rising aftermarket sales owing to passenger traffic is a tailwind.
New Downgrades
Cost Challenges to Hurt DICK'S Sporting's (DKS) Profitability
Per the Zacks analyst, DICK'S Sporting is likely to witnesses soft EBT margin in fiscal 2023 on possibility of higher shrink and severance expenses to be incurred for its business optimization efforts
Lower Transactions Amid High Rates Hurt CBRE Group (CBRE)
Per the Zacks analyst, lower commercial real estate transactions amid persistent macroeconomic uncertainty and high interest rates raise concerns for CBRE Group's transaction-based line of businesses.
Regulatory Requirements, Stiff Competition Ail Avantor (AVTR)
The Zacks analyst is worried about Avantor's operation in a tough competitive space and a strict regulatory setting.
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Automatic Data Processing, Inc. (ADP) : Free Stock Analysis Report
Petroleo Brasileiro S.A.- Petrobras (PBR) : Free Stock Analysis Report
Amgen Inc. (AMGN) : Free Stock Analysis Report
Canadian Pacific Kansas City Limited (CP) : Free Stock Analysis Report
ServiceNow, Inc. (NOW) : Free Stock Analysis Report
RTX Corporation (RTX) : Free Stock Analysis Report
