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Top Research Reports for Berkshire Hathaway, Johnson & Johnson & NVIDIA

Mark Vickery

Monday, August 19, 2019

The Zacks Research Daily presents the best research output of our analyst team. Today's Research Daily features updated research reports on 12 major stocks, including Berkshire Hathaway (BRK.B), Johnson & Johnson (JNJ) and NVIDIA (NVDA). 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 >>>

Berkshire Hathaway’s shares have underperformed the Zacks Insurance - Property and Casualty industry in the past year (-4.2% vs. -2.9%). Berkshire Hathaway’s earnings per share of $2.50 decreased 10.9% year over year, due to weak insurance business results. However, the quarter witnessed better revenues and pre-tax income.

The Zacks analyst thinks the company’s inorganic growth story remains impressive with strategic acquisitions. A strong cash position supports earnings-accretive bolt-on buyouts. Demand for utilities is expected to drive earnings growth. Continued insurance business growth also fuels increase in float. Its non-insurance businesses are delivering improved results.

A sturdy capital level provides further impetus. However, its exposure to catastrophe loss remains a concern as its property and casualty insurance business generates maximum return on equity. Huge capital expenses due to railroad operations are a cause for concern.

(You can read the full research report on Berkshire Hathaway here >>>).

Shares of Johnson & Johnson have outperformed the Zacks Large Cap Pharmaceuticals industry so far this year (+1.8% vs. -2.4%). The Zacks analyst thinks J&J is witnessing significant generic/biosimilar headwinds in the Pharma unit in 2019. However, J&J’s sales and earnings growth is expected to accelerate in 202,0 supported by contribution from new drugs like Tremfya and successful label expansion of cancer drugs like Imbruvica and Darzalex and immunology drug, Stelara.

J&J is also making rapid progress with its pipeline and line extensions. It has already gained FDA approval for two new drugs in 2019, Balversa and Spravato. Meanwhile, share buybacks and restructuring initiatives should provide bottom-line support.

Headwinds like biosimilar/generic competition and pricing pressure remain. The talc and opioid litigations are overhangs on the stock.

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

NVIDIA’s shares have underperformed the Zacks General Semiconductor industry over the past year (down -35.6% vs. -8.4%). NVIDIA delivered solid second-quarter fiscal 2020 wherein both earnings and revenues topped estimates and improved sequentially as well.

The Zacks analyst thinks better-than-expected results can be attributed to strength in the automotive, gaming plus OEM and IP end-markets. Also, increasing deal wins for autonomous vehicle development and the solid uptake of AI-based smart cockpit infotainment solutions are a tailwind. Moreover, the rising traction of GeForce laptops and RTX GPUs in the market is a positive.

Further, the company’s recent acquisition of Mellanox is likely to be its main driver as it will fortify its datacenter footprint and lend a competitive edge. However, the current pause in spending by hyperscale customers persists as an overhang on its data center business. Growing competition from AMD also poses a threat to the company.

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

Other noteworthy reports we are featuring today include Charter Communications (CHTR), Booking Holdings (BKNG) and Fidelity (FIS).

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Note: Our Director of Research 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

Strategic Acquisitions Aid Berkshire (BRK.B), Cat Loss Hurts

J&J (JNJ) Facing Generic Woes in 2019, Recovery Likely in 2020

Solid Automotive Business Aids NVIDIA (NVDA), Datacenter Ails

Featured Reports

Subscriber Gains, Wireless Initiatives Benefit Charter (CHTR)

Per the Zacks analyst, subscriber growth in residential and commercial Internet along with wireless initiatives like the Comcast collaboration aids Charter's growth.

Digital Moves Aid Fidelity (FIS), Intense Competition Hurts

Per Zacks analyst, Fidelity is well positioned to benefit from investments in mobile banking and innovative products such as PayNet and BuyWay. Competition from fintechs and new entrants is a woe.

Solid Gross Bookings Momentum Aids Booking Holdings (BKNG)

Per the Zacks analyst, robust merchant business, strengthening accommodation unit and rising booked room nights numbers are aiding Booking Holdings' gross bookings growth.

Strategic Initiatives Aid Anthem (ANTM), Rising Costs Hurt

Per the Zacks analyst, a number of acquisitions and collaborations have helped Anthem to enhance its capabilities and boost its Medicare business. However, elevated expenses bother the company.

New Drugs, Label Expansion of Other Drugs Fuel Roche (RHHBY)

Per the Zacks analyst, strong growth in Ocrevus, Perjeta, Tecentriq, Alecensa and Hemlibra fuels expansion for oncology leader Roche. The company's efforts to diversify its portfolio are impressive.

Passenger Revenues, Dividends & Buybacks Boost Delta (DAL)

The Zacks analyst likes the uptick in passenger revenues on the back of strong demand for air travel.

End-market Strength Drives Agilent (A), Expenses a Concern

Per the Zacks analyst, Agilent's expanding product portfolio and end-market strength are key growth drivers.

New Upgrades

Renewable Assets & Long-term PSA Aid Pattern Energy (PEGI)

Per the Zacks analyst, Pattern Energy's increasing renewable assets for electricity generation and long-term power sales agreement with customers will boost its performance.

Abercrombie's (ANF) Sturdy Comps Run to Propel Top Line

Abercrombie has an impressive comparable sales run. Per the Zacks analyst, progress on strategic initiatives, alongside strength in Hollister and direct-to-customer business should drive sales.

Model N (MODN) Rides on Expanding Clientele & Acquisitions

Per Zacks analyst, Model N is benefiting from strong demand for its Revenue Cloud offering. Notably, integration of Revitas acquisition has bolstered customer base in life sciences vertical.

New Downgrades

Sarepta's (SRPT) Dependence on Single Product a Concern

Per the Zacks analyst, the dependence of Sarepta on single product, Exondys 51, is a concern for its near term growth. Competition in RNA-based treatment is another threat.

Inventory Clearance, Markdowns Hurt Macy's (M) Bottom Line

Per the Zacks analyst, inventory cleaning process and markdowns weigh upon Macy's bottom line in the second quarter. This also compelled management to curtail its fiscal 2019 earnings guidance.

Enersys' (ENS) Growth Marred by Weak Motive Power Business

Per the Zacks analyst, Enersys' revenues are being dampened by weakness in motive power business due to ERP implementation issues in the Americas region. High operating costs remains a concern.

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NVIDIA Corporation (NVDA) : Free Stock Analysis Report
Johnson & Johnson (JNJ) : Free Stock Analysis Report
Fidelity National Information Services, Inc. (FIS) : Free Stock Analysis Report
Charter Communications, Inc. (CHTR) : Free Stock Analysis Report
Berkshire Hathaway Inc. (BRK.B) : Free Stock Analysis Report
Booking Holdings Inc. (BKNG) : Free Stock Analysis Report
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