Top Research Reports for Procter & Gamble, AbbVie & IBM

Friday June 22, 2018

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 Procter & Gamble (PG), AbbVie (ABBV) and IBM (IBM). 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 >>>

Procter & Gamble's shares have underperformed the Zacks Soap and Cleaning Materials industry year to date (-16.8% vs. -11.5%). The Zacks analyst thinks Procter & Gamble has been benefiting from higher demand for skincare products, along with fabric and home care products.

Further, the company boasts an impressive earnings surprise history, which continued in third-quarter fiscal 2018. Also, results improved year over year. While bottom-line results were aided by productivity cost savings, top line was driven by organic sales growth and higher volumes.

Management remains focused on product improvement, packaging and marketing initiatives, and productivity cost-savings plan. The company is witnessing strained margins owing to increased commodity costs, adverse geographic and product mix as well as unfavorable pricing impacts and product reinvestments. Also, slower global market growth along with softness across Baby, Feminine and Family Care segment remains concerns.

(You can read the full research report on Procter & Gamble here >>>).

Shares of AbbVie have lost -1.2% year to date, outperforming the Zacks Large Cap Pharmaceuticals industry, which has declined -5.1% over the same period. AbbVie’s key drug, Humira is performing well based on strong demand trends despite new competition.

Moreover, Imbruvica has multibillion-dollar potential and AbbVie is exploring the possibility of label expansion into solid tumors and autoimmune diseases. Mavyret’s launch has been stronger than expected. Mavyret has become a major growth driver for AbbVie in a short time on the market.

AbbVie has an impressive late-stage pipeline with label expansions for both new and existing products expected over the next few years. Several pivotal data readouts and regulatory milestones are expected in 2018.

Promising data from several pivotal studies and settlement of its second Humira patent dispute with Biogen are other tailwinds. However, Viekira’s sales continue to be hurt by intensifying competition. Also, potential long-term competition to Humira is a concern.

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

IBM’s shares have underperformed the broader market on a year-to-date basis, losing -8% vs. the S&P 500’s +3% gain. The Zacks analyst likes IBM’s improving position in the cloud, security and analytics. Moreover, accretive acquisitions have expanded IBM’s product portfolio into higher-growth segments, such as Cloud computing and Big Data.

Further, expanding footprint in the rapidly growing blockchain market is positive. The expanded partnership with Red Hat bodes well for the company in the long haul. Oniqua buyout will add asset optimization capabilities IoT based capabilities to aid IBM’s Maximo. IBM has positive record of earnings surprises in recent quarters.

However, the strategic imperatives will take some more time to report meaningful growth and offset weakness in the traditional business. IBM’s ongoing heavily time-consuming business model transition to cloud continues to hurt the stock. Additionally, intensifying competition is a major concern. Estimates have been stable lately ahead of the company’s Q2 earnings release.

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

Other noteworthy reports we are featuring today include PepsiCo (PEP), McDonald's (MCD) and General Electric (GE).

Looking for Stocks with Skyrocketing Upside?

Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.

Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.

See the pot trades we're targeting>>

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

Procter & Gamble's (PG) Cost Savings to Offset Margin Issues

AbbVie's (ABBV) Pipeline Solid amid Humira Competition Woes

Traction in Cloud & Blockchain Initiatives Benefits IBM

Featured Reports

McDonald's (MCD) Gains From Re-Franchising, High Costs Hurt

The Zacks analyst thinks while McDonald's re-franchising strategies will cut the company's capital requirements and facilitate EPS growth, high costs of operation may continue to weigh on margins.

PepsiCo's (PEP) Strong Brand Recognition to Drive Growth

Per the Zacks analyst, PepsiCo's solid brand portfolio along with consistent focus on product innovation and strong snacks business are likely to boost growth across the company's overall business.

Restructuring Efforts Aid Barclays (BCS), Legal Woes Linger

Per the Zacks analyst, Barclays' business simplifying efforts (including ring-fencing) are likely to further lower expenses.

Passenger Revenues Aid Alaska Air Group (ALK), Costs Ail

The Zacks analyst likes the growth in passenger revenues at Alaska Air Group. High operating expenses and capacity- related issues, however, are major headwinds.

Strong Balance Sheet, Revenue Growth Aid CNO Financial (CNO)

Per the Zacks analyst, the company should continue its revenue growth momentum driven by its growth initiatives.

Acquisitions Aid Teladoc's (TDOC) Topline Growth

Per the Zacks analyst, acquisitions of HealthiestYou, Best Doctors, Advance Medical have expanded the company's distribution capabilities and broadened its service offerings thereby driving revenues.

Paramount & MTV Turnaround, Cost Savings Aids Viacom (VIAB)

Per the Zacks analyst, the ongoing turnaround at Paramount and MTV along with new channel launches in the International territories benefits Viacom.

New Upgrades

Winnebago (WGO) Rides on Strong Towable Segment Sales

Per the Zacks analyst, strong organic growth and high-profitability across its own product lines and Grand Design brand have enabled Winnebago's Towable segment to grow rapidly.

Solid Industrial & Energy Markets to Benefit Actuant (ATU)

Per the Zacks analyst, Actuant is poised to gain from healthy product demand in the industrial markets as well as from higher maintenance activities in the energy market.

Assurant (AIZ) Continues to Gain from Increasing Premiums

Per the Zacks analyst, improving premiums, mainly driven by premium growth across segments, continue to boost Assurant's top line, thereby resulting in the company's overall growth.

New Downgrades

Price Fluctuations, Nuclear Labor Costs Hurt Entergy (ETR)

Per the Zacks analyst, price fluctuations in wholesale power markets can deter growth for Entergy Corporation. Higher nuclear labor costs hampers operational growth leading to additional expenses.

Weak U.S Beer Sales, High Debt to Hurt Owens-Illinois (OI)

Per the Zacks analyst, Owens-Illinois' results will continue to bear the brunt of the slowdown in beer sales in the United States and high debt levels.

Weak Power Business to Hurt General Electric Company (GE)

Per the Zacks analyst, tepid performance of General Electric Company's GE Power business on account of lower demand of turbines is weighing on the company's bottom line.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Procter & Gamble Company (The) (PG) : Free Stock Analysis Report
 
Pepsico, Inc. (PEP) : Free Stock Analysis Report
 
McDonald's Corporation (MCD) : Free Stock Analysis Report
 
International Business Machines Corporation (IBM) : Free Stock Analysis Report
 
General Electric Company (GE) : Free Stock Analysis Report
 
AbbVie Inc. (ABBV) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research