Yahoo Finance The Zacks Analyst Blog Highlights Home Depot, Merck, Bank of America, Elevance Health and ResMed
For Immediate Release
Chicago, IL – January 11, 2023 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: The Home Depot, Inc. HD, Merck & Co., Inc. MRK, Bank of America Corp. BAC, Elevance Health Inc. ELV and ResMed Inc. RMD.
Here are highlights from Tuesday’s Analyst Blog:
Top Analyst Reports for Home Depot, Merck and Bank of America
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 The Home Depot, Inc. (HD), Merck & Co., Inc. (MRK) and Bank of America Corp. (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 >>>
Shares of Home Depot have performed roughly in-line with the broader market over the past year (-18.6% vs. -18.1% for the S&P 500 index) and only modestly better than rival Lowe's (down -19.5%).
The Zacks Construction which earlier matched Home Depot's performance has lately done relatively better as interest rates have pulled back a bit (down -15.1%). But on the whole, the outlook for Home Depot is a function of the outlook for the housing space that has been weighed down by higher interest rates resulting from the Fed's tightening cycle.
Home Depot reported its 10th straight quarter of earnings and sales beat in the fiscal third quarter. Results also outpaced our estimate in Q3. It continues to gain from strong demand for home-improvement projects, robust housing market trends and ongoing investments.
It also witnessed continued strength in both Pro and DIY categories, and digital momentum. Its interconnected retail strategy and underlying technology infrastructure have helped consistently boost web traffic for the past few quarters, aiding digital sales.
(You can read the full research report on Home Depot here >>>)
Merck shares have outperformed the Zacks Large Cap Pharmaceuticals industry over the past year (+35.1% vs. +12.4%) on the back of sales momentum in the company’s drugs like Keytruda and Gardasil vaccine. With continued label expansion into new indications & early-stage settings, Keytruda is expected to remain a key top-line driver.
Animal health and vaccine products are core growth drivers. Its new COVID oral antiviral pill, Lagevrio has become a key top-line driver in 2022. Merck boasts a strong cancer pipeline, including Keytruda, which should help drive long-term growth.
However, generic competition for several drugs and rising competitive pressure, mainly on the diabetes franchise, will continue to be overhangs on the top line. There are concerns about Merck’s ability to grow its non-oncology business ahead of Keytruda’s loss of exclusivity later in the decade.
(You can read the full research report on Merck here >>>)
Shares of Bank of America have weakened more than the peer group in recent weeks on crypto-related litigation issues, resulting in the stock significantly lagging the industry as well as the market. The stock is down -30.6% over the past year vs. JPMorgan's -17.3% pullback and the S&P 500 index's -18.1% decline.
Bank of America as well as the other banks benefit from higher interest rates through improved net-interest margins, but the risk of a significant economic downturn is weighing on the outlook.
Nevertheless, the opening of new financial centers, enhancement in digital capabilities and cost-saving efforts are expected to keep aiding the company’s financials. Supported by loan growth, Bank of America's top line is expected to improve. Our estimates for total revenues suggest that the metric will grow 6.2% in 2022.
Given the rise in interest rates, the company is expected to witness growth in margins in the near term. Per our estimates, BAC will record a net interest yield of 1.93% in 2022, higher than the level recorded in 2021.
(You can read the full research report on Bank of America here >>>)
Other noteworthy reports we are featuring today include Elevance Health Inc. (ELV) and ResMed Inc. (RMD).
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Bank of America Corporation (BAC) : Free Stock Analysis Report
Merck & Co., Inc. (MRK) : Free Stock Analysis Report
The Home Depot, Inc. (HD) : Free Stock Analysis Report
ResMed Inc. (RMD) : Free Stock Analysis Report
Elevance Health, Inc. (ELV) : Free Stock Analysis Report
