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Top Stock Reports for Anheuser-Busch, Gilead & Canadian National

Sheraz Mian
·6-min read

Friday, September 25, 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 Anheuser-Busch InBev (BUD), Gilead Sciences (GILD) and Canadian National Railway (CNI). 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 >>>

Anheuser-Busch shares have underperformed the Zacks Alcoholic Beverages industry in the year to date period (-35.5% vs. -23.4%). The Zacks analyst believes that gradual reopening of the on-premise channels across many countries led to improved volume trends on a month-to-month basis for AB InBev.

Though overall volume declined year over year in the quarter, volume trends improved on a month-to-month basis. Further, strength in the off-premise channel and premium brands remain encouraging. Driven by these trends, it reported better-than-expected top and bottom line result in second-quarter 2020.

Additionally, the company’s investment behind B2B platforms, e-commerce channels and digital marketing have accelerated in the past few months, which is likely to aid growth in the coming quarters. However, the company’s second-quarter top and bottom lines declined year over year driven by significant the impacts of the pandemic.

(You can read the full research report on Anheuser-Busch here >>>)

Shares of Gilead have lost -1.6% over the past year against the Zacks Biomedical and Genetics industry’s rise of +15.9%. The Zacks analyst believes that Gilead's strong HIV franchise should help the company maintain its momentum. Newly launched products should continue to perform well, thereby driving the top-line growth.

The ongoing pandemic impacted Gilead’s sales for both the HCV and HIV franchises, which caused fewer healthcare provider visits and screenings. HIV sales are impacted by lower sales volume of Truvada. Meanwhile, the company lifted its annual guidance probably to account for sales from its antiviral drug remdesivir for COVID-19.

Gilead is also seeing early signs of recovery from this impact and expects a full rebound by the second half. Increase in demand for remdesivir should boost the top line as the pandemic continues to impact more and more people globally. Yescarta too is picking up gradually. However, the prospects of remdesivir will be hit once a vaccine is out.

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

Canadian National’s shares have gained +36.3% over the past six months against the Zacks Rail industry’s rise of +37.3%. The Zacks analyst believes that Canadian National is being aided by shipments of higher volumes of grains.

The company moved a record 15 million metric tonnes of Canadian grain in the first half of 2020. The company's buyout of TransX is another positive and has contributed to its supply chain and intermodal businesses across North America. The company’s efforts to continue paying dividends to shareholders despite adversities are an added boon.

Strong free-cash flow generation (up 97.8% in first-half 2020) supports such activities. However, decline in freight revenues, mainly due to coronavirus-led weak volumes, is concerning. Deterioration in the operating ratio due to high operating expenses is an added bane. The company's liquidity position is also worrisome.

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

Other noteworthy reports we are featuring today include Zoetis (ZTS), Stryker (SYK) and Goldman Sachs (GS).

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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

Gradual Recovery in Volume Trends Aid AB InBev (BUD) in Q2

HIV, Coronavirus Drug Boost Gilead (GILD) Amid Competition

Dividends Aid Canadian National (CNI) Amid Weak Volumes

Featured Reports

New Products, Acquisition Fuel Zoetis (ZTS) Amid Slowdown

Per the Zacks analyst, Zoetis' companion animal business is being driven by Apoquel and Simparica. Also, the recent acquisitions are encouraging.

Core MedSurg Unit Aids Stryker (SYK), Pricing Pressure Ails

Per the Zacks analyst, Stryker continues to gain from solid prospects of its core MedSurg arm.

Goldman (GS) Exhibits Cost Control; Legal Issues Linger

Per the Zacks analyst, Goldman's cost control efforts are likely to boost its operational efficiency.

Acquisitions Aid Revenue Growth at Global Payments (GPN)

Per the Zacks analyst, numerous acquisitions, alliances, partnerships and joint ventures are aiding its revenue growth.

Investments Aid American Electric (AEP), Sales Decline Ails

Per the Zacks analyst, American Electric's systematic investment in infrastructural upgrades should boost customer reliability.

Rising Top-line Aid, High Debts Hurt HCA Healthcare (HCA)

Per the Zacks analyst, its growing top-line has led to significant growth for the company. However, its high leverage continues to weigh down the margins.

Darden (DRI) Rides on Robust Online Sales, Traffic Woes Stay

Per the Zacks analyst, robust online sales and technology-driven moves are likely to be a major growth driver for Darden during the current scenario.

New Upgrades

Digital Ramp Up & Cost Cut Efforts to Aid AutoZone (AZO)

Increasing e-commerce efforts are buoying the sales growth of AutoZone amid coronavirus. The Zacks analyst also appreciates the cost control initiatives undertaken by the firm to enhance margins.

Toll Brothers (TOL) Rides on Buyouts & Solid Housing Market

Per the Zacks analyst, favorable housing backdrop, lack of competition in the luxury new home market, and buyout synergies have been driving Toll Brothers.

United Natural (UNFI) Sales to Gain on Pandemic-Led Demand

Per the Zacks analyst, United Natural is set to gain on solid demand amid the coronavirus-led higher at-home consumption.

New Downgrades

High Labor and Delivery Costs Hurt Pool Corp (POOL) Prospects

Per the Zacks analyst, Pool Corp has been negatively impacted by rising labor and delivery costs.

Low Rates, Elevated Costs to Hurt Washington Federal (WAFD)

Per the Zacks analyst, Washington Federal's net interest margin is expected to continue to be hurt by the near-zero interest rates. As the company invests in technology upgrades, costs will escalate.

Lower Inventory & Higher Expenses to Hurt At Home (HOME)

Inventory constraints, increase in the seasonal mix along with store maintenance and expansion expenses is a pressing concern for At Home, per the Zacks analyst.

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Zoetis Inc. (ZTS) : Free Stock Analysis Report
Stryker Corporation (SYK) : Free Stock Analysis Report
The Goldman Sachs Group, Inc. (GS) : Free Stock Analysis Report
Gilead Sciences, Inc. (GILD) : Free Stock Analysis Report
Canadian National Railway Company (CNI) : Free Stock Analysis Report
AnheuserBusch InBev SANV (BUD) : Free Stock Analysis Report
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