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Top Research Reports for Johnson & Johnson, Walmart & Bank of America

Sheraz Mian

Monday, June 15, 2020

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 Johnson & Johnson (JNJ), Walmart (WMT) and Bank of America (BAC). 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 >>>

Johnson & Johnson’s shares have underperformed the Zacks Large Cap Pharmaceuticals over the past year (+0.5% vs. +3.3%). The Zacks analyst believes that while the coronavirus pandemic is hurting the company’s Medical Devices unit, the Pharma and Consumer segments remain resilient.

J&J’s Pharma unit is performing above-market levels, supported by contribution from new drugs and successful label expansion of blockbuster drugs, Imbruvica, Darzalex and Stelara. J&J is also making rapid progress with its pipeline and line extensions. Several pivotal data readouts and regulatory milestones are expected in 2020.

However, headwinds like generic competition and pricing pressure remain. J&J faces numerous lawsuits, which allege personal injuries to patients caused by the use of its products. These lawsuits have resulted in uncertainty.

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

Shares of Walmart have lost -2.3% over the past six months against the Zacks Supermarkets industry’s fall of -1.5%. The Zacks analyst believes that the stock has been benefiting from increased demand for essential items amid coronavirus.

Such trends drove the company in first-quarter fiscal 2021, wherein top and bottom lines rose year over year and beat the consensus mark, and U.S. comps grew for the 23rd straight time. Further, higher stay-at-home trends boosted e-commerce sales. Walmart has long been witnessing solid e-commerce sales, largely backed by grocery delivery.

Notably, it recently unveiled Express Delivery service to expedite deliveries amid coronavirus. The company is also undertaking other measures to support operations amid the pandemic, which however entail high costs and pose threats to the operating income. Also, the gross margin has been strained due to unfavorable mix and pricing.

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

Bank of America’s shares have gained +17.6% over the past three months against the Zacks Major Regional Banks industry’s rise of +18.8%. The Zacks analyst believes that opening new branches, improved digital offerings and efforts to manage costs will likely aid profitability.

Additionally, strong balance sheet and liquidity position are expected to continue supporting the company's financials amid economic slowdown. However, near-zero interest rates are expected to hurt the bank’s margins and interest income.

Also, coronavirus-induced concerns will likely continue to hamper business activities and thus, loan growth is expected to be muted. Further, dependence on capital markets performance makes us apprehensive, given its cyclical nature. This is likely to hurt fee income growth to some extent  

(You can read the full research report on Bank of America here >>>)

Other noteworthy reports we are featuring today include AstraZeneca (AZN), International Business Machines (IBM) and Lockheed Martin (LMT).

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Sheraz Mian

Director of Research

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

Mixed Impact of Coronavirus Pandemic on J&J's (JNJ) Units

Ecommerce Sales to Fuel Walmart (WMT), Soft Margins a Worry

Loan Growth, Branch Openings Aid BofA (BAC) amid Lower Rates

Featured Reports

Cancer Drugs to Drive AstraZeneca's (AZN) Sales in 2020

The Zacks analyst says that AstraZeneca's cancer drugs, Lynparza, Tagrisso and Imfinzi, should drive revenues in 2020 while the coronavirus outbreak may hurt its profits.

Robust Adoption of Cloud Solutions Aids IBM Amid High Debt

Per the Zacks analyst, IBM's improving position in the hosted cloud, security and analytics domains hold promise.

Robust Demand Aids Lockheed (LMT), F-35 program's Cost Hurts

Per the Zacks Analyst, Lockheed Martin witnesses strong demand for its aircraft programs and missile defense systems.

Upstream Unit Buoys PetroChina (PTR) Amid Gas Import Losses

The Zacks analyst believes oil production growth and lower lifting costs should aid PetroChina's upstream unit outlook but is worried over the losses on the domestic resale of imported natural gas.

Decline in Expenses to Drive American Express' (AXP) Margins

Per the Zacks analyst, halt in advertising and slowdown in product launches will lower marketing costs and aid margins.

Fiserv (FISV) Rides on Strategic Business Moves, Debt High

The Zacks analyst likes Fiserv's acquisition strategy to widen its client base and enhance its product portfolio. High debt may limit the company's future expansion and worsen its risk profile.

Micron (MU) Benefits from Growing Memory-Chip Demand

Per the Zacks Analyst, Micron is growing on solid memory-chip demand from PC manufacturers and data-center operators.

New Upgrades

Acquisitions, Solid Asset Balance Support BlackRock (BLK)

Per the Zacks analyst, BlackRock's global expansion efforts via acquisitions, initiatives to restructure its active equity business and solid assets under management balance will likely aid revenues.

Delphi Technologies Buyout & Low Debt to Aid BorgWarner (BWA)

Per the Zacks Analyst, BorgWarner's planned buyout of Delphi Technologies is likely to strengthen its propulsion unit. Further, its low leverage of 25% is also set to boost prospects.

Strong Demand & Partnerships to Benefit Macquarie (MIC)

The Zacks analyst believes that Macquarie's business partnerships with other companies along with solid demand for the storage of petroleum products will continue to lend momentum to the company.

New Downgrades

Weak Demand, Low Oil Prices to Hurt Caterpillar (CAT)

The Zacks analyst is concerned that Caterpillar's results will bear the brunt of a weak manufacturing sector, low spending in the mining sector, impact of coronavirus outbreak and low oil prices.

Soft Market Demand and Rising Costs Hurt Middleby (MIDD)

Per the Zacks analyst, Middleby is struggling with the poor performance of the Commercial Foodservice Equipment segment owing to low market demand.

Azul (AZUL) Stung by Weak Air-Travel Demand & High Debts

The Zacks analyst is anxious about coronavirus-induced plummeting air-travel demand. Moreover, high debt load and unfavorable currency-movements are worrisome.

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Walmart Inc. (WMT) : Free Stock Analysis Report
Lockheed Martin Corporation (LMT) : Free Stock Analysis Report
Johnson Johnson (JNJ) : Free Stock Analysis Report
International Business Machines Corporation (IBM) : Free Stock Analysis Report
Bank of America Corporation (BAC) : Free Stock Analysis Report
AstraZeneca PLC (AZN) : Free Stock Analysis Report
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