Friday, March 11, 2022
Zacks Research Daily features top research results from our team of analysts. Today’s Research Daily features new research reports on 16 major stocks, including Eli Lilly and Company (LLY), NIKE, Inc. (NKE) and Micron Technology, Inc. (MU). These research reports have been handpicked from the approximately 70 reports published today by our team of analysts.
You can see all today’s research reports here >>>
Shares of Eli Lily outperformed the industry Zacks Large Cap Pharmaceuticals over the past year (+29.6% vs. +19.2%). Lilly has a strong pipeline of entry-level medicines in diabetes, autoimmune diseases and cancer. The Zacks analyst believes Lilly’s revenue growth is being driven by increased demand for drugs like Trulicity, Taltz and others. It regularly adds promising new pipeline assets through business development agreements. It has an exciting pipeline of potential new drugs, including tirzepatide for type II diabetes and donanemab for early-stage Alzheimer’s disease. Both candidates have multi-billion dollar sales potential.
However, generic competition for several drugs, increasing price pressure in the United States, mainly on the key drug, Trulicity, and price reductions in some international markets such as China, Japan and Europe are headwinds.
(You can read the full research report on Eli Lilly here >>>)
NIKE stocks are down -10.2% over the past year against declines of -10.4% in the Zacks shoe industry and clothing retail. The Zacks analyst believes NIKE shares have declined over the past year due to headwinds related to supply chain constraints. Declines in Greater China and APLA, and continued impacts from supply chain headwinds in the market partially hurt the company’s revenue in the second quarter of fiscal 2022.
NIKE expects volatility in fiscal 2022 due to disruptions caused by COVID variants. However, product innovation, brand strength and scale of company operations are expected to continue to drive digital sales. It remains on track to deliver on its outlook for FY2025.
(You can read the full NIKE research report here >>>)
Shares of Micron have underperformed the S&P 500 index year-to-date (-18.7% vs. -10.5%). The Zacks analyst believes that Micron’s short-term profitability may be affected by its planned salary increases. Additionally, the higher level of customer inventory in the cloud, graphics, and enterprise market is a major threat. Demand for software servers from several enterprise original equipment manufacturer (OEM) customers is also a concern.
However, Micron has already seen growing demand for memory chips from cloud computing providers and accelerating adoption of 5G (fifth generation) cellular networks. The increase in the number of high value-added solutions, improved customer engagement and improved cost structure are also growth drivers. Additionally, 5G adoption beyond mobile is likely to drive demand for memory and storage, especially in Internet of Things (IoT) devices and wireless infrastructure.
(You can read the full Micron research report here >>>)
Other noteworthy reports we feature today include Bayer Aktiengesellschaft (BAYRY), American International Group, Inc. (AIG) and Valero Energy Corporation (VLO).
Director of Research
Note: Sheraz Mian leads the equity research department at Zacks and is a well-known expert on overall earnings. He is frequently quoted in the written and electronic press and publishes the weekly Earnings Trends and Revenue overview reports. If you would like to receive an email notification whenever Sheraz publishes a new article, please click here>>>
To read today
Eli Lilly (LLY) boasts a strong diabetes and Alzheimer’s pipeline
NIKE (NKE) Sales Rise on Improved Traffic and Digital Growth
Micron (MU) benefits from growing demand for memory chips
Strong Programs Help Hexcel (HXL) Amid COVID-Induced Slowdown
According to the Zacks analyst, Hexcel’s short-term outlook has been affected by the outbreak of the pandemic, but its impressive set of programs tends to boost long-term growth prospects.
Valero (VLO) Gains Refinery Throughput on the Gulf Coast
The Zacks analyst is impressed with Valero’s Gulf Coast refineries contributing the most to its total throughput volumes. Higher export volumes from the Gulf Coast should also support its margins.
Baker Hughes (BKR) benefits from a higher oil services order
The Zacks analyst likes Baker Hughes because he will guarantee good cash flow from an increase in oil services orders. Still, the decline in volume in subsea production systems is concerning.
AIG benefits from improving turnover, high debts disturb
According to the Zacks analyst, buyouts and divestitures have improved the company’s capabilities, leading to revenue growth. However, the high debt level remains a concern.
Aid State Street (STT) Top Line Redemptions Amid Low Rates
Zacks analyst says business services wins, synergies from strategic buyouts and global footprint will continue to help State Street amid falling interest rates and challenging operating environment.
Acquisitions, Solid Telehealth Platform Aid Teladoc (TDOC)
According to the Zacks analyst, several acquisitions have helped Teladoc expand its distribution capabilities and global presence. A robust telehealth platform puts it well in the middle of a booming telehealth market.
Recent drug approvals help Bayer (BAYRY), Stiff Rivalry a Woe
According to the Zacks analyst, Bayer has undertaken several initiatives to strengthen its portfolio. However, competition from generic threats remains a concern.
ABM Industries Incorporated (ABM) will benefit from the ELEVATE plan
According to the Zacks analyst, ABM’s multi-year global strategic plan, ELEVATE, should significantly accelerate the company’s organic growth and strengthen its profitability.
Rising steel prices and strategic acquisitions benefit Nucor (NUE)
According to the Zacks analyst, Nucor will benefit from higher steel prices due to tight supply and higher end market demand. It will also expand its business through strategic acquisitions.
Solid revenue growth by segment helps AMN Healthcare (AMN)
Strong revenue growth in the Nurse and Allied Solutions businesses, as well as the Physical and Leadership and Technology and Workforce Solutions businesses continues to drive AMN Healthcare, according to the Zacks analyst.
Ubiquiti (UI) hit by supply disruptions and rising costs
According to the Zacks analyst, Ubiquiti continues to face supply chain challenges triggered by the pandemic as well as rising raw material costs, which are directly weighing on its results.
Staffing challenges and inflation hurt Red Robin’s outlook (RRGB)
According to the Zacks analyst, Red Robin has encountered coronavirus-induced staffing and supply chain issues. Additionally, inflation in commodity and restaurant labor costs is a concern.
Dismal traffic and high costs hurt prospects for Yum China (YUMC)
According to the Zacks analyst, Yum China has experienced high costs due to labor inflation and packaging upgrades. Additionally, the decline in traffic from pre-pandemic levels is concerning.
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NIKE, Inc. (NKE): Free Stock Analysis Report
Eli Lilly and Company (LLY): Free Stock Analysis Report
American International Group, Inc. (AIG): Free Stock Analysis Report
Micron Technology, Inc. (MU): Free Stock Analysis Report
Valero Energy Corporation (VLO): Free Stock Analysis Report
Bayer Aktiengesellschaft (BAYRY): Free Stock Analysis Report
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Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.