Thursday, December 12, 2024

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 Mastercard Incorporated (MA), The Procter & Gamble Company (PG) and Novartis AG (NVS), as well as two micro-cap stocks, IDT Corporation (IDT) and GSI Technology, Inc. (GSIT). These research reports have been hand-picked from roughly 70 reports published by our analyst team today.

You can see all of today’s research reports here >>>

Mastercard shares outperformed Visa shares over the past year (+25.6% vs. +19.9%), but lagged the broader market over the same time period (+25.6% vs. +30.5%). The Zacks analyst notes that numerous acquisitions are helping Mastercard to grow addressable markets and drive new revenue streams. Mastercard expects low-teens net revenue growth in the fourth quarter of 2024. The accelerated adoption of digital and contactless solutions is providing an opportunity for its business to expedite its shift to the digital mode.

However, steep operating expenses might stress its margins in the future. High rebates and incentives may weigh on net revenues.

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

Procter & Gamble shares have outperformed the Zacks Consumer Products - Staples industry over the past year (+14.9% vs. +10.1%). The Zacks analyst believes that the company has been gaining from a strategy that focuses on sustainability and adaptability, responding to the evolving demands of consumers and society. It has been focused on productivity and cost-saving plans to boost margins.

Yet, PG has been witnessing headwinds related to the market issues in Greater China, geopolitical tensions, and financial impacts from currency volatility.

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

Shares of Novartis have underperformed the Zacks  Large Cap Pharmaceuticals industry over the past two years (+8.7% vs. +15.0%). Per the Zacks analyst, the loss of patent protection for some of the key drugs in Novartis’ portfolio is a concern. Gleevec/Glivec, Diovan and Exforge face continued and increasing generic competition in major markets. Novartis has continued to suffer legal setbacks in its attempt to block the entry of a generic version of its blockbuster heart drug Entresto. The company has also suffered quite a few pipeline setbacks.

However, Novartis maintains strong momentum on the back of a strong and diverse portfolio with drugs like Entresto, Kesimpta, Kisqali, Cosentyx, Pluvicto and Leqvio. The label expansion of Kisqali further fuels sales of this drug. Approval of new drugs and label expansion of existing drugs should aid.

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

IDT’s shares have outperformed the Zacks Diversified Communication Services industry over the last six months (+40.5% vs. -1.5%). The Zacks analyst believes that IDT's growth strategy centers on high-growth segments like NRS, BOSS Money, and net2phone, which are expanding in digital payments, international remittances, and cloud communications. IDT's cost controls boosted profitability. Positioned in digital and cashless payment trends, IDT leverages BOSS Money and NRS's strong merchant network.

Yet, competition and regulatory compliance pressures may impact profitability. The legacy communications segment's decline and fintech competition pose challenges for sustaining revenue growth. Other challenges include regulatory pressures, currency volatility and scaling investments.

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

GSI Tech’s shares have outperformed the Zacks Computer – Storage Devices industry over the last six months (+4.1% vs. -26.5%). The Zacks analyst believes that introduction of Gemini-I APU servers has boosted the company’s prospects. Expansion into government contracts through SBIR initiatives diversifies revenue and enhances defense sector credibility. The company's next development, Gemini-II, aims to enhance data processing efficiency, promising significant market penetration.

Yet, challenges arise from a significant drop in core SigmaQuad sales and dependency on major customers like Nokia, introducing revenue volatility. Competitive pressures in the rapidly evolving HPC market necessitate continuous innovation.

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

Other noteworthy reports we are featuring today include Sony Group Corporation (SONY), Enbridge Inc. (ENB) and Motorola Solutions, Inc. (MSI).

Director of Research

Sheraz Mian

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

Kisqali, Pluvicto Drive Novartis (NVS) Amid Competition

Strong Cross-Border Volumes Aid Mastercard (MA) Amid High Costs

P&G's (PG) Productivity & Cost Savings Plan to Aid Margins

Featured Reports

TC Energy (TRP) to Capitalize on Growing Natural Gas Demand
The Zacks analyst believes TC Energy is uniquely positioned to capitalize on the growing North American natural gas demand, driven by LNG exports and the electricity needs of AI data centers.

Enbridge (ENB) Gains From Long-term Transportation Contracts
Enbridge generates stable fee-based revenues from its long-term, low-risk oil and gas transportation contracts. Yet, its significant debt exposure concerns the Zacks analyst.

Solid Music & G&NS Sales Boost SONY Amid Weak Hardware Sales
Per the Zacks analyst, strength in the Game & Network Services, notably software sales and Music units is driving Sony's performance. Reduced demand for hardware and mobile sensors are concerning.

Diverse Product Portfolio, Strategic Alliances Aid Motorola Solutions
Per the Zacks analyst, Motorola is poised for solid growth in video security, command center software and land mobile radio services led by healthy demand trends and a holistic growth focus.

Surgical Sales Rebound, New Product Launches Aid Alcon (ALC)
The Zacks analyst is optimistic about consistent share gains and strong global ATIOL penetrations within Alcon's Surgical business. New product launches aid growth.

Demand for Specialty Products Driving McKesson (MCK) Prospects
Per the Zacks analyst, McKesson's distribution segment will continue to benefit from higher volume of specialty products coupled with price rise. Rising demand for extended and primary care buoys well

Loans, Restructuring Aid KeyCorp (KEY), Asset Quality Ails
Per the Zacks analyst, decent loan demand, restructuring initiatives, and relatively high rates will support Keycorp's financials. Yet, elevated expenses and weak asset quality are headwinds.

New Upgrades

Expanding Clientele, Hybrid-Working Solutions Aids Zoom (ZM)
Per the Zacks analyst, Zoom is benefiting from solid adoption of hybrid-working solutions like Zoom Phone and expanding subscriber base driven by the need for digital transformation among enterprises.

Favorable Budget, Solid Contract Wins Aid Leidos (LDOS)
Per the Zacks analyst, increasing budgetary revisions by the U.S. administration should boost Leidos' growth. Steady contract wins also bolster this stock's revenue prospects.

SkyWest (SKYW) Benefits From Improving Air-Travel Demand
The Zacks Analyst is impressed with the fact that increased air-travel demand is helping SkyWest carry more passengers and witness more revenues.

New Downgrades

Lower Volumes & Elevated Costs Ail Dover's (DOV) Performance
Per the Zacks analyst, lower business volumes will impact Dover's performance in the upcoming quarters. Elevated costs and supply-chain issues will continue to be headwinds.

Expected Decline in Shipment, Rising Capex Ail Harley (HOG)
Per the Zacks analyst, an anticipated decline in wholesale shipment in 2024 is likely to hurt Harley's revenue growth. Rising capital requirement is also a concern.

Dave & Buster's (PLAY) Hurt By Dismal Comparable Store Sales
Per the Zacks analyst, Dave & Buster's performance continues to hurt by dismal comparable store sales. During third-quarter fiscal 2024, comps declined 7.7% year over year.

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Novartis AG (NVS) : Free Stock Analysis Report

Mastercard Incorporated (MA) : Free Stock Analysis Report

Procter & Gamble Company (The) (PG) : Free Stock Analysis Report

Enbridge Inc (ENB) : Free Stock Analysis Report

Motorola Solutions, Inc. (MSI) : Free Stock Analysis Report

Sony Corporation (SONY) : Free Stock Analysis Report

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