Thursday, October 29, 2020
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 UnitedHealth Group (UNH), Adobe (ADBE) and Pfizer (PFE). 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 >>>
UnitedHealth shares have outperformed the Zacks Medical Insurance industry in the year to date period (+2.9% vs. -2%). The Zacks analyst believes that its numerous acquisitions bode well for its inorganic growth profile. Further, expansion of its health services segment provides significant diversification benefits.
A solid balance sheet and consistent cash flow generation not only encourage investments in business but also add shareholder value. The company’s top line has been bolstered by new deals, renewed agreements and expansion of service offerings.
It's third-quarter earnings of $3.51 per share beat estimates by 17.8%, but declined 9.5% year over year as the pandemic-disrupted healthcare utilization returned closer to normalcy. However, it is witnessing a slowdown in its international operations. Commercial membership may also see attrition due to increased joblessness.
(You can read the full research report on UnitedHealth here >>>)
Shares of Adobe have gained +65.9% over the past year against the Zacks Computer Software industry’s rise of +31%. The Zacks analyst believes Adobe is gaining from strong demand for its creative products. The company’s Creative Cloud, Document Cloud and Adobe Experience Cloud products are driving the top-line growth.
Further, rising subscription revenues and solid momentum across mobile apps are major positives. Additionally, growth in emerging markets, robust online video creation demand and improving average revenue per user are tailwinds. We remain optimistic about Adobe’s market position, compelling product lines, continued innovation, solid adoption of Creative Cloud and Adobe marketing cloud.
However, lower end-market demand is a concern. Further, significant exposure in Europe is an overhang due to foreign currency headwinds. Additionally, high acquisition expenses do not bode well for margin expansion.
(You can read the full research report on Adobe here >>>)
Pfizer’s shares have lost -8.8% over the past six months against the Zacks Large-Cap Pharmaceuticals industry’s fall of -6.1%. The Zacks analyst believes that the Consumer Healthcare joint venture with Glaxo and the pending merger of Upjohn unit with Mylan will make Pfizer a smaller company with a diversified portfolio of innovative drugs and vaccines.
The smaller Pfizer should see better revenue growth as the Lyrica loss of exclusivity (LOE) cliff will go away. Pfizer expects strong growth of key brands like Ibrance and Eliquis to drive sales in future quarters. The focus remains on the progress of its COVID-19 vaccine.
Pfizer beat Q3 estimates for earnings while missing the same for sales. It narrowed its 2020 guidance due to a slow pace of recovery from pandemic. However, currency headwinds and pricing pressure are key top-line headwinds. Coronavirus-related business disruption hurt sales in Q2 and Q3.
(You can read the full research report on Pfizer here >>>)
Other noteworthy reports we are featuring today include Roche (RHHBY), Intel (INTC) and T-Mobile US (TMUS).
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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
Solid Top Line & Strong Cash Flows Drive UnitedHealth (UNH)
Adobe (ADBE) Rides on Creative Strength; Expenses A Concern
Ibrance & Other Key Drugs to Drive Pfizer's (PFE) Sales
New Drugs Boost Roche (RHHBY) Amid COVID-19 & Competition
Per the Zacks analyst, growth in Ocrevus, Perjeta, Tecentriq, and Hemlibra will continue to maintain momentum for Roche and offset the impact of COVID-19.
Intel (INTC) Banks on Portfolio Strength Amid 7 nm Delay
Per the Zacks analyst, solid uptake of 5G networking solutions, and demand from cloud service providers will drive Intel's growth.
T-Mobile (TMUS) Rides on Faster Mid-Band 5G Spectrum Rollout
Per the Zacks analyst, T-Mobile is poised to benefit from the aggressive rollout of its mid-band 5G spectrum.
Chevron (CVX) Boosts Permian Position with Noble Buy
The Zacks analyst believes Chevron's Noble buyout has significantly strengthened its position in the Permian Basin but is worried over the company's reserve replacement ratio of just 44%.
3M (MMM) to Gain From Demand & Cost Moves Amid Pandemic Woes
Per a Zacks analyst, 3M (MMM) is poised to benefit from solid demand for products in personal safety, general cleaning other markets.
Caterpillar (CAT) Bets on Cost Control Amid Weak Demand
Per the Zacks analyst, Caterpillar's focus on cutting down costs will help sustain margins despite the weak demand owing to the impact of the coronavirus pandemic.
Investment on Clean Assets & Infrastructure Aid Dominion (D)
`Per the Zacks analyst, Dominion's planned investment in the range of $23.9B through 2022 to enhance clean electricity generation and strengthen its infrastructure will boost its profitability.
Hanesbrands (HBI) Gains From Online Sales Amid COVID-19
Per the Zacks analyst, Hanesbrands (HBI) is gaining from solid online sales amid coronavirus. Notably, global online sales grew over 70% in the second quarter.
Amkor (AMKR) Banks on Growing Demand for Advanced Products
Per the Zacks analyst, solid demand for advanced packaging technologies is benefiting Amkor's performance in the communications, consumer, computing, and automotive end markets.
Robust Development Pipeline to Aid Red Rock Resorts (RRR)
Per the Zacks analyst, Red Rock Resorts' best-in-class assets and locations, unparalleled distribution, and solid development pipeline position it well for long term growth.
Weak Travel Demand, Asset Disposition Hurt Host Hotels (HST)
Per the Zacks analyst, low travel amid the pandemic is affecting demand for Host Hotels' properties. Further, asset dispositions are likely to have a dilutive impact on its near term earnings.
Norwegian Cruise (NCLH) Hurt By Cruise Suspension & Cash Burn
Per the Zacks analyst, dismal global bookings owing to the coronavirus hurt Norwegian Cruise. Moreover, the company is experiencing a cash burn of approximately $160 million a month, on average.
Hawaiian Holdings (HA) Weak Due to Tepid Passenger Revenues
The Zacks analyst grows bearish on the stock due to pandemic-led tepid passenger revenues (down 70.6% in the first nine months of 2020). Steep non-fuel unit costs due to capacity cuts are a bane too.
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UnitedHealth Group Incorporated (UNH) : Free Stock Analysis Report
TMobile US, Inc. (TMUS) : Free Stock Analysis Report
Roche Holding AG (RHHBY) : Free Stock Analysis Report
Pfizer Inc. (PFE) : Free Stock Analysis Report
Intel Corporation (INTC) : Free Stock Analysis Report
Adobe Systems Incorporated (ADBE) : Free Stock Analysis Report
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