Monday, August 28, 2023

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 Alphabet Inc. (GOOGL), Roche Holding AG (RHHBY) and Honeywell International Inc. (HON). 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 >>>

Alphabet shares have outperformed the Zacks Tech sector (+48% vs. +35%) as well as the S&P 500 index (+48% vs. +15.5%) in the year-to-date period on the back of the company's central role in the evolving artificial intelligence (AI) developments. Adding to the AI hopes is the company’s strong cloud division and improving outlook for the digital ad market. 

Also, strong focus on innovation of AI techniques and the home automation space should aid business growth in the long term. Further, its deepening focus on wearables category remains a tailwind. Alphabet’s expanding presence in the autonomous driving space is contributing well. Its growing efforts to gain foothold in the healthcare industry are other positives.

However, sluggishness in the company’s Network advertisement business remains a headwind. Additionally, its growing litigation issues and increasing expenses are concerns.    

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

Shares of Roche have gained +4.3% over the past six months against the Zacks Large Cap Pharmaceuticals industry’s gain of +18.8%. The company’s new drugs, namely Ocrevus, Hemlibra, Evrysdi, Phesgo, Polivy and Tecentriq, recorded growth and should maintain momentum. The uptake of the new eye drug, Vabysmo has been outstanding. The company’s efforts to develop new drugs to combat the decline in legacy drugs are drugs are encouraging.

However, Roche’s performance in the first half was average as COVID-19-product-related sales declined significantly impacting the top line, even though the diagnostics base business and newer drugs maintained their growth.

Also, sales are likely to be affected further by the expected nosedive in sales of COVID-19 products of nearly CHF 5 billion. Competition from biosimilars for established cancer medicines like Avastin, MabThera/Rituxan and Herceptin also hurt sales.

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

Shares of Honeywell International have underperformed the Zacks Diversified Operations industry over the past year (-1.1% vs. +3.3%). The company is witnessing supply-chain disruptions which remain a concern. Weakness in the Safety and Productivity Solutions unit due to lower warehouse, and workflow and productivity solutions volumes is worrisome. Raw material cost inflation and adverse foreign currency movements are other concerns.

Nevertheless, Recovery in commercial flight hours, strength in process solutions and UOP businesses augur well for Honeywell’s growth. Solid operational execution, pricing actions and cost-control measures continue to drive the company’s top line. HON’s bullish forecast for 2023 holds promise.

Handsome rewards to shareholders add to the stock’s appeal. HON’s recent acquisition of Compressor Controls enhances its expertise in industrial control, automation and process solutions.

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

Other noteworthy reports we are featuring today include Amgen Inc. (AMGN), International Business Machines Corporation (IBM) and The Goldman Sachs Group, Inc. (GS).

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>>>