Top Research Reports for Meta Platforms, Eli Lilly & Caterpillar
Thursday, October 12, 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), Eli Lilly and Company (LLY) and Caterpillar Inc. (CAT). 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 Meta Platforms have outperformed the Zacks Internet - Software industry over the year-to-date period (+172.4% vs. +53.5%) on the back of 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.
The combination of steady user growth and improving outlook for the digital ad space is showing up in rising earnings estimates for teh company.
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 >>>)
Eli Lilly shares have outperformed the Zacks Large Cap Pharmaceuticals industry over the past year (+84.2% vs. +28.7%). The company’s revenue growth is being driven by higher demand for drugs like Verzenio, Trulicity, Taltz and others. Sales of its new drug, Mounjaro, are already benefiting from strong demand trends.
Mounjaro is expected to be a key long-term top-line driver for Lilly as it has the potential to be approved for obesity and other diabetes-related diseases. Mounjaro showed superior weight-loss reduction in clinical studies for obesity. Lilly expects regulatory decisions for some key pipeline candidates this year.
However, generic competition for some drugs, rising pricing pressure and challenges in meeting strong demand for incretin products are some top-line headwinds. Estimates have declined slightly ahead of Q3 results. Lilly has a mixed record of earnings surprises in the recent quarters
(You can read the full research report on Eli Lilly here >>>)
Shares of Caterpillar have outperformed the Zacks Manufacturing - Construction and Mining industry over the past six months (+24.4% vs. +23.8%). The company’s revenues and earnings have grown year over year for 10 straight quarters thanks to its cost-saving actions, strong end-market demand and pricing actions, which offset the impact of the supply-chain snarls and cost pressures.
The Construction Industries segment is expected to benefit from the rising construction activities in the United States and other parts of the world. Backed by demand for commodities fueled by the energy-transition trend, a thriving mining sector will aid the Resource Industries segment.
Caterpillar’s dividend yield and payout ratio are higher than its peers. A strong liquidity position, investments in expanding services and digital initiatives will help Caterpillar deliver outsized returns.
(You can read the full research report on Caterpillar here >>>)
Other noteworthy reports we are featuring today include Amgen Inc. (AMGN), Citigroup Inc. (C) and Micron Technology, Inc. (MU).
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
User Growth, Instagram Strength Aids Meta Platforms (META)
Lilly (LLY) New Products Hold Key to Long-Term Growth
Caterpillar (CAT) to Gain on Strong Demand in End Markets
Featured Reports
Amgen (AMGN) Makes Rapid Progress on Solid Pipeline
The Zacks analysts believes Amgen has some key pipeline assets in obesity, cancer and inflammation, which are indications that can have a large market opportunity
Streamlining Efforts & NII Aids Citigroup (C) Amid Cost Woes
Per the Zacks analyst, A rise in NII and streamlining of its international operations are likely to support Citigroup (C). Yet, a rise in operating costs and muted non-interest income are headwinds. n
Rising High-Value Solution Mix Aids Micron Technology (MU)
Per the Zacks analyst, Micron's rising mix of high-value solutions and 5G adoption in IoT devices is expected to partially offset the negative impact of declining memory chip demand from PC vendors.
Southern Company (SO) Buoyed by Regulated Customer Growth
The Zacks analyst believes that increase in Southern's regulated business customer base will support its revenue growth but is concerned over timing and cost overrun related to Vogtle project.
Lennar (LEN) Banks on Strategic Initiatives Amid High Costs
Per the Zacks analyst, Lennar is benefiting from profitable business strategies, digital marketing initiatives and a dynamic pricing model. However, high costs and interest rate hikes hurt growth.
Monolithic (MPWR) Rides on AI Focus, Healthy Automotive Traction
Per the Zacks analyst, rising demand for advanced driver assistance systems, focus on developing AI integrated solutions and a healthy cash balance will likely boost Monolithic's commercial prospects.
Growing Premiums Aid RenaissanceRe (RNR), Cost Woes Stay
Per the Zacks analyst, RenaissanceRe's rising premiums are driven by continued rate increases and strong segmental contributions. However, high expenses put pressure on margins.
New Upgrades
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
Xerox (XRX) is Gaining from Cost and Productivity Initiatives
Per the Zacks Analyst, Xerox's cost control and productivity improvement initiative called "Project Own It," is fetching results to the company in form of strong margins.
Golar LNG (GLNG) Benefits From Dividends & Share Buybacks
The Zacks analyst likes the shareholder-friendly measures adopted by Golar LNG. Such efforts boost investor confidence and the company's bottom line.
New Downgrades
Limited Users, Regulations Ail NextEra Energy Partners (NEP)
Per the Zacks analyst NextEra Energy Partners (NEP) dependence on a limited group of customers for revenues and additional expenses to meet to stringent regulations could impact its operations.
B&G Foods' (BGS) Top Line Troubled by Soft Volume Trends
Per the Zacks analyst, B&G Foods' sales have been troubled by decrease in unit volumes, as witnessed in the second quarter. At its earnings release, management lowered its fiscal 2023 net sales view.
Uncertainty of the Capital Markets Hurt Morgan Stanley (MS)
Per the Zacks analyst, the uncertain performance of the capital markets is a woe for Morgan Stanley. Higher costs due to its inorganic growth efforts and investments in franchise will hurt profits.
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Citigroup Inc. (C) : Free Stock Analysis Report
Caterpillar Inc. (CAT) : Free Stock Analysis Report
Eli Lilly and Company (LLY) : Free Stock Analysis Report
Amgen Inc. (AMGN) : Free Stock Analysis Report
Micron Technology, Inc. (MU) : Free Stock Analysis Report
Meta Platforms, Inc. (META) : Free Stock Analysis Report
