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Top Stock Reports for Celgene, Sinopec & HSBC

Mark Vickery

Monday, September 16, 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 Celgene (CELG), Sinopec (SNP) and HSBC Holdings (HSBC). 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 >>>

Celgene’s shares have outperformed the Zacks Large Cap Pharmaceuticals industry over the past three months (1.2% vs. -4.3%). The Zacks analyst thinks that Celgene’s lead drug, Revlimid, continues to drive revenues on label expansions and market share gains.

Robust performance of psoriasis drug, Otezla, is also boosting Celgene’s performance. Investors are focusing on the company’s merger with large-cap pharma Bristol-Myers for a whopping $74 billion.

Per the terms, Celgene shareholders will receive $50 plus one share of Bristol-Myers and one tradeable Contingent Value Right, which will entitle the holder to receive a cash payment of $9.00 upon the receipt of FDA approval for three candidates — ozanimod, liso-cel and bb2121. The merger was initially opposed but was eventually given a green signal.

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

Shares of Sinopec have lost 26.4% in the past six months, underperforming the Zacks Integrated Oil industry’s fall of 18.3%. The Zacks analyst believes that the company has made major progress in identifying attractive and economically viable oil and natural gas reserves.

A huge scale of prospective reserves was discovered in a number of prolific natural gas basins like Sichuan and Ordos. The discoveries will help Sinopec capitalize on mounting clean energy demand as China is transitioning from coal to natural gas for electricity generations. However, China’s bleak economic outlook will continue to hurt the firm’s refining business.

In fact, soft refining margin primarily led the company to report dismal second-quarter 2019 earnings. Moreover, the firm’s cash flow declined 54% year over year in the first half of 2019, reflecting weak operations. 

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

HSBC’s shares have lost 4.8% year to date, underperforming the Zacks Foreign Banks industry’s rise of 2.9% over the same period.

The Zacks analyst believes that the company’s initiatives to improve market share in the U.K. and China are likely to lead to an increase in expenses and hurt bottom-line growth. These efforts will support financials over the long term. Also, initiatives to strengthen digital capabilities globally, improve operating efficiency and open 50 new retail banking branches in the United States will go a long way in supporting profits.

Its steady capital deployments are impressive, reflecting a strong balance sheet position, and will enhance shareholder value. Nevertheless, disappointing economic growth in Europe and weak loan demand are likely to hurt revenue growth to some extent. Additionally, uncertainty related to the implication of Brexit on its financials remains a major near-term concern.

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

Other noteworthy reports we are featuring today include BHP Group (BHP), Vertex Pharmaceuticals (VRTX) and Prudential Financial (PRU).

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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

Solid Revlimid Boost Celgene (CELG), Dependence A Concern

Sinopec (SNP) Banks on Sichuan Gas Discovery, Refining Weak

Digital Capabilities to Aid HSBC (HSBC) Amid Revenue Concern

Featured Reports

Focus on Renewables Aids AES Corp. (AES), Regulations Hurt

Per the Zacks analyst, AES Corp.'s focus on renewables should boost growth led by rapid expansion of renewable overseas footprint. However, stringent environmental regulations are a major headwind.

Fleet Modernization Efforts Aid SkyWest (SKYW), Costs Ail

The Zacks analyst is impressed by SkyWest's fleet modernization initiatives, which are helping the company streamline its operations.

Tiffany's (TIF) Omnichannel Bodes Well, Soft Margins a Woe

Per the Zacks analyst, Tiffany's omni-channel platform, innovative brands and store expansion plans bode well.

Solid Pension Risk Transfer Business Aids Prudential (PRU)

Per the Zacks analyst, Prudential is set to grow on solid pension risk transfer business, momentum in U.S. Financial Wellness and international operations.

Solid Performance by Food Safety Segment Aids Neog (NEOG).

Robust performance by the AccuPoint advanced test system, a core food safety product line, contributes to Neogen's revenue growth.

Gibraltar (ROCK) to Gain From Solid Backlog, Weak Volume Ail

Per the Zacks analyst, higher backlog and Four-Pillar Value Creation strategy bode well for Gibraltar.

Healthcare Initiatives Boost FUJIFILM's (FUJIY) Prospects

Per the Zacks analyst, FUJIFILM is benefiting from robust performance of its Healthcare driven by acquisitions and investments in CDMO and regenerative medicine businesses.

New Upgrades

Vertex's (VRTX) Cystic Fibrosis Sales Strong; Pipeline Solid

New regulatory approvals/line extensions are driving Vertex's Cystic Fibrosis (CF) drugs' sales. Its pipeline comprising a triple combo CF pill and other non-CF drugs is strong, per the Zacks analyst.

Franco-Nevada (FNV) Bets on Cobre Panama & Energy Revenues

Per the Zacks analyst, Franco-Nevada is well poised to gain from the Cobre Panama project, solid energy revenues and healthy portfolio of streaming and royalty agreements.

Cimpress N.V (CMPR) Gains From Solid Product Line, Buyouts

The Zacks analyst believes that robust mass customization businesses, supported by improved product offerings, and accretive acquisitions like BuildASign will continue to lend momentum to Cimpress.

New Downgrades

Higher Unit Costs & Low Metal Prices to Hurt BHP Group (BHP)

The Zacks Analyst is concerned lower metal prices due to the ongoing trade war and higher unit costs due to natural field decline at petroleum and lower copper grades will impact BHP's results.

Delek (DK) Hurt by Declining Permian Discount

The Zacks analyst believes that the declining discounts on Permian oil, to which 70% of Delek's refining capacity is exposed, might continue to hamper the company's bottom line.

Cheniere (LNG) Wrecked by Huge Debt Burden, Low Cash Flow

A massive debt burden of nearly $30 billion coupled with low internally generated cash flow, has made the Zacks analyst turn bearish on Cheniere Energy.

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Vertex Pharmaceuticals Incorporated (VRTX) : Free Stock Analysis Report
China Petroleum & Chemical Corporation (SNP) : Free Stock Analysis Report
Prudential Financial, Inc. (PRU) : Free Stock Analysis Report
HSBC Holdings plc (HSBC) : Free Stock Analysis Report
Celgene Corporation (CELG) : Free Stock Analysis Report
BHP Group Limited (BHP) : Free Stock Analysis Report
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