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Top Stock Reports for Home Depot, Abbott & Bristol-Myers

Mark Vickery

Wednesday, August 21, 2019

The Zacks Research Daily presents the best research output of our analyst team. Today's Research Daily features updated research reports on 16 major stocks, including Home Depot (HD), Abbott (ABT) and Bristol-Myers (BMY). These research reports have been hand-picked from roughly 70 reports published by our analyst team today.

You can see all of today’s research reports here >>>

Home Depot’s shares have gained +21% year to date, outperforming the Zacks Retail Building Products industry’s +19.5% increase. The Zacks analyst thinks that this is attributable to a robust earnings surprise trend recorded for more than five years, which continued in second-quarter fiscal 2019.

Earnings benefited from progress on strategic investments as well as a favorable U.S. consumer backdrop and a steady housing market. Meanwhile, the company’s top line lagged estimates but improved year over year on robust comps performance. Its efforts to provide an interconnected shopping experience to customers, with innovative products and improved productivity, position it for growth.

Despite these gains, lumber price deflation remained a drag on the company’s sales and comps in the fiscal second quarter. Further, it slashed its sales and comps view for fiscal 2019 on lumber price deflation and fears of potential impacts of the newly enacted tariffs.

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

Shares of Abbott have gained +30.2% over the past year, significantly outperforming the Zacks Medical Products industry, which has increased +3.2% over the same period. Abbott exited second quarter 2019 with better-than-expected earnings. However, revenues lagged the estimates.

The Zacks analyst is optimistic about the strong and consistent EPD and Medical Devices performance. The company has been hogging the limelight within Diabetic Care on growth with FreeStyle Libre. This apart, synergies from Alere consolidation in the form of Rapid Diagnostics have been driving growth. Within Structural Heart, worldwide uptake of MitraClip therapy improves further.

Meanwhile, the company’s emerging market performance has been promising. Consequently, Abbott has raised its full-year guidance. On the flip side, sluggish Rhythm Management arm in the United States continues to dent growth. Increasing currency headwind is another downside.

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

Bristol-Myers’ shares have underperformed the Zacks Large Cap Pharmaceuticals industry in the year-to-date period, losing -8.7% vs. -2.1%. The Zacks analyst thinks Bristol-Myers’ lead immuno-oncology drug, Opdivo, continues to drive growth. Label expansion of Opdivo into additional indications should further boost the top line. Empliciti and Sprycel are also performing well.

Bristol-Myers also has presence in other core therapeutic areas, including immunoscience and cardiovascular. Blood thinner drug, Eliquis, is expected to drive further growth, propelled by increased share in the novel oral anticoagulant (NOAC) market.

The impending acquisition of Celgene Corporation will broaden Bristol-Myers’ oncology portfolio with the addition of blockbuster drug, Revlimid. However, pipeline setbacks are a concern. The failure of the part 2 of the Checkmate-227 study was disappointing, given the potential in the NSCLC market.

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

Other noteworthy reports we are featuring today include Activision (ATVI), MPLX LP (MPLX) and Marathon Petroleum (MPC).

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Note: Our Director of Research 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

Focus on Pro Customers to Aid Home Depot's (HD) Top Line

Abbott (ABT) EPD Gains in Emerging Space on Branded Generics

Eliquis, Label Expansion of Opdivo Fuel Bristol-Myers (BMY)

Featured Reports

Franchise Strength Aids Activision (ATVI) Amid Competition

Per the Zacks analyst, Activision's solid portfolio comprising Call of Duty, Overwatch and King's Candy Crush is helping it to steer past intensifying competition.

Andeavor Buy Boosts Marathon (MPC), Turnaround Cost Hurts

While the successful integration of Andeavor's operations bode well for Marathon Petroleum, the Zacks analyst is worried over the projected plant turnaround costs in the third quarter.

MPLX to Capitalize on Permian Pipeline Bottleneck Problem

The Zacks analyst believes that MPLX is well positioned to cash in on transportation capacity constraints in the prolific Permian, courtesy of its growing network of natural gas pipelines.

Solid Retirement, Group Benefits Business Aid Principal (PFG)

Per the Zacks analyst, Principal Financial should benefit from sturdy retirement and long-term savings, and solid global asset management.

Customer Additions & Organic Growth Aid Aqua America (WTR)

Per the Zacks analyst Aqua America's systematic capital investment is resulting in organic growth of the company.

Strong In-force Business Aid Reinsurance Group (RGA)

Per the Zacks analyst, Reinsurance Group is set to grow from solid in-force business generating predictable long-term earnings risk.

Portfolio Repositioning to Benefit AGNC Investment (AGNC)

Per the Zacks analyst, in the current volatile interest rate and high prepayment environment, AGNC Invesmtent's commitment to reposition the portfolio will likely optimize its performance.

New Upgrades

Carnival (CCL) Rides on Higher Revenue Yield & Strong Demand

Despite increased expenses, the Zacks analyst is encouraged by Carnival's effort to enhance revenue yield from high ticket prices amid increased demand.

Gap's (GPS) Robust Omni-Channel Endeavors to Drive Sales

Per Zacks analyst, Gap is enhancing omni-channel capabilities and has increased online presence across its brands. Robust online trends with higher traffic and conversions are likely to fuel sales.

Focus on Wealth Management to support Waddell & Reed (WDR)

Per the Zacks analyst, Waddell & Reed's efforts to strengthen wealth management channel and asset inflows will likely aid revenues. Efficient capital deployment plan reflect solid liquidity position.

New Downgrades

Lower End-Market Demand, Trade-War Woes Hurts Amphenol (APH)

Per the Zacks analyst, Amphenol suffers from lower demand for its products in communications equipment, automotive and industrial end-markets and ongoing U.S.-China trade war.

Mettler-Toledo (MTD) Hurt by Sluggish Food Retail Business

Per the Zacks analyst, continued weakness in Mettler-Toledo's food retail segment due to unfavorable customer project timing are hurting sales in Americas and Europe.

Higher Markdowns Remain a Worry for Dillard's (DDS) Margins

Per the Zacks analyst, higher markdowns is the key reason for Dillard's soft margins and bottom line growth in recent years. Markdowns mainly stem from high inventory levels at stores.

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MPLX LP (MPLX) : Free Stock Analysis Report
Marathon Petroleum Corporation (MPC) : Free Stock Analysis Report
The Home Depot, Inc. (HD) : Free Stock Analysis Report
Bristol-Myers Squibb Company (BMY) : Free Stock Analysis Report
Activision Blizzard, Inc (ATVI) : Free Stock Analysis Report
Abbott Laboratories (ABT) : Free Stock Analysis Report
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