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Top Research Reports for Phillip Morris, Bristol-Myers & Walgreens Boots

Mark Vickery
Top Research Reports for Phillip Morris, Bristol-Myers & Walgreens Boots

Friday, March 29, 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 Phillip Morris (PM), Bristol-Myers (BMY) and Walgreens Boots (WBA). 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 >>>

Phillip Morris' shares have gained +6.7% in the past six months, outperforming the Zacks Tobacco industry's decline of -2.4%. The Zacks analyst thinks the company is gaining from its strong pricing strategies. In fact, favorable pricing has played an important role in boosting revenues for a while.

Also, this drove the company’s performance in the fourth quarter of 2018, wherein it delivered the third and the fourth straight quarter of top- and bottom-line surprises, respectively. The company is also undertaking initiatives to strengthen RRPs, which are rapidly gaining market popularity. In fact, it has introduced new versions of IQOS to capture market share.

Additionally, the company provided a favorable view for 2019. However, Philip Morris is grappling with declines in total shipment volumes, stemming from weak cigarette sales. Stringent regulations on tobacco products have been marring cigarette industry volumes. Moreover, unfavorable currency movements are a viable threat.

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

Shares of Bristol-Myers have underperformed the Zacks Large Cap Pharmaceuticals industry in the past six months, losing -22.9% vs. +2.1%. Bristol-Myers' blockbuster immuno-oncology drug, Opdivo continues to perform well. The Zacks analyst thinks the approval of the drug for first-line RCC and adjuvant melanoma has boosted sales. Label expansion of other drugs like Sprycel and Empliciti should further drive the company’s performance.

In January, Bristol-Myers announced that it will acquire Celgene for an equity value of approximately $74 billion. While the acquisition will bolster the company’s portfolio, it is being opposed by a few shareholders, who believe that the deal is overpriced, significantly increasing shareholders’ risk.

Moreover, the company’s voluntary withdrawal of the sBLA seeking approval of Opdivo+Yervoy as a treatment for first-line NSCLC with tumor mutational burden greater or equal to 10 mutations/megabase was disappointing, given the market potential.

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

Walgreens Boots’ shares have outperformed the Zacks Drug Stores industry over the past six months, losing -13.7% vs. -24.4%. The Zacks analyst thinks that within the Retail Pharmacy USA division, the company has been making solid progress with respect to boosting prescription volume. Walgreens Boots is launching a phase of transformational cost management to reduce margin pressure.

The company has been gaining from strategic tie-ups as well. Walgreens Boots’ recent alliance with Microsoft to use the Azure platform is a welcome move. The company’s deal with Alphabet’s life sciences and healthcare segment, Verily is another positive. The company’s decision to launch next-day prescription delivery service with FedEx provides further cause for optimism.

On the flip side, tough market conditions, particularly in retail, have been leading to sluggishness in Walgreens Boots' Retail Pharmacy International division. The ongoing generic drug inflation is hurting pharmacy margins as well.

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

Other noteworthy reports we are featuring today include Paychex (PAYX), Sirius XM (SIRI) and Total System Services (TSS).

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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

RRPs Boost Phillip Morris (PM), Low Cigarette Volumes Ail

Opdivo Drives Bristol-Myers' (BMY) Amid Pipeline Setbacks

Rite Aid Store Additions, Microsoft Deal Aid Walgreens (WBA)

Featured Reports

Sanofi (SNY) Diabetes Unit Weak, New Drugs to Drive Growth

The Zacks analyst believes that Sanofi has many new products and pipeline candidates that can drive long-term growth. Weak diabetes sales and generic competition for many drugs are headwinds.

Content Strength, Pandora Acquisition Aids Sirius XM (SIRI)

Per the Zacks analyst, Sirius XM's solid content slate, which drives subscriber growth and average revenue per user (ARPU) is expected to improve further following the Pandora acquisition.

Product Backlogs Aid BorgWarner (BWA) Amid Market Concerns

Per the Zacks analyst, strong backlogs for innovative hybrid and electric propulsion engines helps BorgWarner to expand market presence.

KB Home (KBH) Banks on Strategic Initiatives, Costs High

Per the Zacks analyst, Returns-Focused Growth plan and Built-to-Order process bode well for KB Homes strong overall performance.

Catalyst Pharma (CPRX) Eyes Firdapse Label Expansion

Per the Zacks analyst, Catalyst remains focused on the development and label expansion of Firdapse amidst competition.

Focus on Debt Reduction Aids Natural Resource Partners (NRP)

Per the Zacks analyst, continuous focus on debt reduction and improving its liquidity position will strengthen Natural Resource Partners' financial position going forward.

Solid E-commerce Momentum to Bolster Hibbett's (HIBB) Sales

Per the Zacks analyst, Hibbett is poised to gain from improving e-commerce penetration.

New Upgrades

Paychex (PAYX) Rides on Outsourcing, PEO Industry Strength

The Zacks analyst is impressed with Paychex's efforts to capitalize on the rising opportunities in the professional employer organization industry. Demand for outsourcing is another growth catalyst.

CommScope (COMM) Rides on Market Strength & Strategic Buyout

Per the Zacks analyst, CommScope aims to capitalize on industry trends, including network convergence and 5G on the back of its strong market position coupled with the proposed acquisition of ARRIS.

Rising Assets, Interest Rates Support Federated (FII)

Per the Zacks analyst, Federated's strategic acquisitions have resulted in asset growth and expansion in market share. Also, rise in interest rates will positively impact top-line performance.

New Downgrades

High Financial Leverage Continues to Hurt Total System (TSS)

Per the Zacks analyst, the company's high debt level, which have been increasing over the past several years, continues to weigh on margins.

Pricing Pressure Hurts ResMed (RMD), Escalating Costs Ail

The Zacks analyst is worried about challenging pricing scenario that continues to plague ResMed. Reimbursement issues and rising costs are other downsides.

Soft Comps, High SG&A Costs Concerns for PriceSmart (PSMT)

Per the Zacks analyst, PriceSmart is grappling with soft comparable net merchandise sales for quite some time now. Moreover, higher SG&A expenses due to opening of new clubs are a strain on margins.

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Walgreens Boots Alliance, Inc. (WBA) : Free Stock Analysis Report
Total System Services, Inc. (TSS) : Free Stock Analysis Report
Sirius XM Holdings Inc. (SIRI) : Free Stock Analysis Report
Philip Morris International Inc. (PM) : Free Stock Analysis Report
Paychex, Inc. (PAYX) : Free Stock Analysis Report
Bristol-Myers Squibb Company (BMY) : Free Stock Analysis Report
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