Friday, September 15, 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 Meta Platforms, Inc. (META), Walmart Inc. (WMT) and Johnson & Johnson (JNJ). 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 >>>

Meta Platforms shares have outperformed the Zacks Internet - Software industry over the past six months (+52.1% vs. +23.0%) as signs of stabilization in the digital advertizing market have showed up. The company is benefiting from steady user growth across all regions, particularly Asia Pacific. Increased engagement for its offerings like Instagram, WhatsApp, Messenger and Facebook has been a major growth driver.

Meta Platforms is leveraging AI to recommend Reels content, which is driving traffic on Instagram and Facebook. Its innovative portfolio, which includes Threads, Reels and Llama 2, is likely to aid prospects.

However, challenging macroeconomic conditions remain a headwind for Meta’s advertising revenues, along with targeting and measurement headwinds due to Apple’s iOS changes. Slow monetization of Reels, along with mounting operating losses at Reality Labs, are concerns.

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

Shares of Walmart have outperformed the Zacks Retail - Supermarkets industry over the past six months (+20.4% vs. +18.1%). The company's performance is driven by its robust omnichannel operations aimed at improving the overall shopping experience. Walmart strategic focus on enhancing delivery services has been especially rewarding.

This is evident from the constant increase in the market share for groceries, which boosted U.S. comparable sales in the second quarter of fiscal 2024. During the quarter, the top and bottom lines grew year over year, encouraging management to raise its guidance for fiscal 2024. Strong comp sales growth globally and e-commerce growth across all units were upsides.

While the gross margin increased year over year, it was partly hurt by an adverse category mix, which is likely to linger in the third quarter. Management also expects variable pay expenses to increase year over year in the third quarter.

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

Shares of Johnson & Johnson have gained +7.9% over the past six months against the Zacks Large Cap Pharmaceuticals industry’s gain of +19.5%. The company’s pharma unit is performing at above-market levels.

Growth in 2023 is expected to be driven by existing products like Darzalex, Tremfya, Erleada, Invega Sustenna and Uptravi, and also continued uptake from new launches, including Spravato, Carvykti and Tecvayli. The MedTech unit is showing improving trends, driven by recovery in surgical procedures and contribution from new products.

J&J is making rapid progress with its pipeline and line extensions. However, headwinds like generic competition and pricing pressure continue. Though J&J has taken meaningful steps to resolve its talc and opioid litigation, uncertainty exists regarding the talc litigations.

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

Other noteworthy reports we are featuring today include Pfizer Inc. (PFE), Linde plc (LIN) and Morgan Stanley (MS).

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>>>