- 20 сентября 2017, 23:47
- Zacks Investment Research
Wednesday, September 20, 2017
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 Northrop Grumman (NOC), Bank of New York Mellon (BK) and Celgene (CELG). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Buy-rated Northrop continues to enjoy strong presence in Air Force, Space & Cyber Security programs. Moreover, its product innovation and focus on strengthening its ISR wing will help maintain a stable earnings stream amid the rapidly changing needs of the defense landscape. The company maintains a strong balance sheet and steady cash flow that offer substantial financial flexibility.
To this end, apart from paying solid dividends to its shareholders, Northrop also follows a share buyback policy to maintain a disciplined cash deployment strategy. Also, recent budgetary amendments made by the Trump administration have been in favor of defense biggies like Northrop. However, too much dependence on fixed-price contracts remains a concern for the stock.
BNY Mellon's shares have outperformed the industry in the last six months (+12.1% vs. +6.8%). The performance was supported by the company’s decent earnings surprise history. It surpassed the Zacks Consensus Estimate for earnings in two of the trailing four quarters. The company’s easing margin pressure (driven by gradual rise in interest rates), potential lesser regulations and rising loan demand are expected to aid top-line growth.
Also, the company’s cost-saving initiatives are likely to improve profitability in the quarters ahead. However, concentration risk arising from significant dependence on fee-based income remains a matter of concern in the near term.
Shares of Celgene have outperformed the industry in the year so far, gaining (+24% vs. +15.3%). Celgene’s Revlimid continued to outperform driven by further market share increases in newly diagnosed myeloma and the continued increase in treatment duration. Other key products – Pomalyst/Imnovid, Abraxane and Otezla – also performed well. The consecutive increase in annual earnings guidance is also a positive.
Celgene continues to progress with its label expansion efforts and pipeline development with sNDA submission for Revlimid in newly diagnosed multiple myeloma targeted for first-quarter 2018. The approval of Idhifa in the U.S. for relapsed and/or refractory acute myeloid leukemia has further boosted the company’s portfolio. However, Celgene is highly dependent on Revlimid while foreign exchange headwinds are expected to continue while Abraxane sales are under competitive pressure.
Other noteworthy reports we are featuring today include Anthem (ANTM), Johnson & Johnson (JNJ) and Colgate-Palmolive (CL).
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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
Per the Zacks Analyst, POSCO (PKX) is poised to gain from 1.7% growth in global steel demand. However, high debt levels might raise financial obligations.
Per the Zacks analyst, heavy investments in product development and escalating operating expenses have kept margins under pressure.
Per the Zacks Analyst, Public Storage is poised to gain from high-brand value and strategic acquisitions. However, rising supply remains a concern.
Per the Zacks analyst, Deutsche Bank's cost saving measures to drive operational efficiency are encouraging. Also, it remains focused to neutralize higher legal costs impact in the upcoming quarters.
Per the Zacks analyst, FirstEnergy (FE) is gaining from its ambitious "Energizing the Future" plan which aims at expanding its regulated transmission capabilities.
Per the Zacks Analyst, Crown Castle's ongoing efforts to diversify its business from being a tower operator into a fiber provider looks impressive.
Per the Zacks analyst, winning the contract to produce Jaguar Land Rover's E-PACE model at the assembly facility in Graz, Austria strengthens Magna's leadership position in contract manufacturing.
The Zacks analyst thinks that Sherwin-Williams is well placed to gain from synergies of the Valspar acquisition. Its actions to cut operating costs should also lend support to its margins.
The Zacks analyst believes that Anthem's consistent revenue growth on the back of rising premium income and investment income continues to boost its margins.
The Zacks analyst stresses that United Rentals is focused on the implementation of Project XL, which is intended to drive profitable growth through a combination of revenue and cost initiatives.
Per the Zacks analyst, soft global unit volumes hurt Colgate's top-line in the second quarter. Volumes are likely to remain weak in the second half, as evident from the lowered organic sales view.
Generic competition to key drugs, pricing pressure, soft global market conditions, declining HCV sales and sluggish growth in the Consumer unit are pressurizing J&J's top-line, says the Zacks analyst.
The Zacks analyst is concerned about headwinds like soft yields and escalated fuel costs hurting Delta. Consequently, the company has trimmed its current-quarter unit revenue view.
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Northrop Grumman Corporation (NOC): Free Stock Analysis Report
Johnson & Johnson (JNJ): Free Stock Analysis Report
Colgate-Palmolive Company (CL): Free Stock Analysis Report
Celgene Corporation (CELG): Free Stock Analysis Report
Bank Of New York Mellon Corporation (The) (BK): Free Stock Analysis Report
Anthem, Inc. (ANTM): Free Stock Analysis Report
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