Tuesday, July 12, 2022
 
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 Coca-Cola Co. (KO), Merck & Co., Inc. (MRK), and Toyota Motor Corp. (TM). 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 >>>

Coca-Cola shares have outperformed the Zacks Beverages - Soft drinks industry over the past year (+17.9% vs. +9.4%). The company’s top and bottom lines surpassed estimates for the fifth straight quarter. The Zacks analyst believes that the results benefited from the company’s strategic transformation and ongoing recovery around the world.

Strength across the majority of the markets, investments in the marketplace, recovery in certain markets as well as the cycling of last year’s pandemic-led impacts aided volumes. The company retained its upbeat 2022 view. It is poised to gain from innovations and accelerating digital investments.

However, pressures from higher supply chain costs, including transportation and input costs remain. Higher marketing spends are also concerning. Also, the unfavorable currency is expected to hurt the top and bottom lines in the second quarter and 2022.

(You can read the full research report on Coca-Cola here >>>)

Merck shares have outperformed the Zacks Large Cap Pharmaceuticals industry over the past year (+25.9% vs. +19.1%). The company’s drugs like Keytruda, Lynparza and Bridion have been driving sales. 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 will be 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 overhang 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 >>>)

Toyota Motor shares have declined -13.4% over the past year against the Zacks Automotive - Foreign industry’s decline of -30.8%. The Zacks analyst believes that the company is reeling under a severe chip crunch compounded by the war.

Unprecedented commodity inflation, supply-chain disruptions, tough labor market, logistical challenges and manufacturing inefficiencies will provide headwinds and clip margins. High capex and R&D expenses are also likely to dent near-term margins and cash flows.

However, Toyota’s electrification push including investment in BEVs, hybrids, batteries and fuel-cell vehicles is set to bolster prospects. It aims to generate 40% of its global sales from EVs by 2025 and 70% by 2030. The expanding portfolio of product lines, a robust lineup of trucks and SUVs, partnerships with Hino and Subaru and Mazda will steer its long-term growth.

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

Other noteworthy reports we are featuring today include HSBC Holdings plc (HSBC), Enbridge Inc. (ENB), and Regeneron Pharmaceuticals, Inc. (REGN).

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>>>