Top Stock Reports for Apple, Mastercard & Eli Lilly

Sheraz Mian
·7-min read

Thursday, August 6, 2020

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 Apple (AAPL), Mastercard (MA) and Eli Lilly (LLY). 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 >>>

Apple shares have outperformed the S&P 500 year to date (+51.5% vs. +3.3%), with the stock benefiting from momentum in the Services business, strong adoption of Apple Pay and growing Apple Music subscriber base.

Apple’s third-quarter fiscal 2020 results reflected continued momentum in the Services segment, driven by a robust performance of App Store, Apple Music, video and cloud services. iPad and Mac also contributed strongly to the quarterly results. Moreover, iPhone sales recovered, driven by strong demand in May and June, primarily for iPhone SE.

Apple devices also continued to gain traction among enterprises, particularly healthcare providers. Apple didn’t provide any guidance due to uncertainties triggered by the pandemic. However, it expects fiscal fourth-quarter iPhone sales to benefit from strong demand for iPhone SE. Apple stated that sale of new iPhones will begin a few weeks later against the usual late September. It also expects iPad and Mac to post strong year-over-year growth.

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

Shares of Mastercard have lost -0.1% over the past six months against the Zacks Financial Transaction Services industry’s fall of -4.2%. The Zacks analyst believes that the company is gaining from transition in payments from physical to digital. Investment in technology keeps it at the forefront of the rapidly-evolving payments industry.

Mastercard’s earnings of $1.36 per share beat the Zacks Consensus Estimate by 18.3% but were down 26% year over year, due to a contraction in gross dollar volume, lower switched transactions and a weak cross-border business.

Mastercard is also witnessing buoyant demand for its Data & Analytics and Cyber solutions. Its solid capital position enables investment in business. However, escalating costs might put pressure on the company’s margins. It also cancelled its annual 2020 outlook for net revenues and operating expense due to coronavirus-induced business loss.

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

Eli Lilly shares have lost -0.6% over the past three months against the Zacks Large Cap Pharmaceuticals industry’s rise of +3.3%. The Zacks analyst believes that generic competition for several drugs, rising pricing pressure in the United States, and price cuts in some international markets like China, Japan and Europe are some top-line headwinds in 2020.

Lilly beat Q2 estimates for earnings but missed the same for sales. Reduction in new prescription trends of several medicines hurt sales in Q2. However, volume trends are likely to improve in the second half.

Lilly still expects revenue growth to be driven by higher demand for drugs like Trulicity, Taltz, and others and from product launches. Lilly is making significant pipeline progress including its efforts to make therapies to treat COVID-19. It is regularly adding promising new pipeline assets through business development deals.

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

Other noteworthy reports we are featuring today include BHP Group (BHP), PetroChina (PTR) and Anheuser-Busch InBev (BUD).

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Sheraz Mian

Director of Research

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

Robust Portfolio, Services Strength to Benefit Apple (AAPL)

Revenue Growth, Solid Balance Sheet Aid Mastercard (MA)

Lilly (LLY) Makes Significant Pipeline Progress

Featured Reports

Liquidity, High Iron Prices Aid BHP Group (BHP), Costs Hurt

The Zacks analyst believes BHP's strong cash flow, focus on lowering debt, higher iron prices and efforts to make operations more efficient will drive growth despite higher costs.

Upstream Unit Buoys PetroChina (PTR) Amid Gas Import Losses

The Zacks analyst believes oil production growth and lower lifting costs should aid PetroChina's upstream unit outlook but is worried over the losses on the domestic resale of imported natural gas.

Gradual Recovery in Volume Trends Aid AB InBev (BUD) in Q2

Per the Zacks analyst, gradual reopening of the on-premise channels across many countries led to improved volume trends on a month-to-month basis for AB InBev.

CSX Aided by Low Costs Amid Coronavirus-led Weak Volumes

Per the Zacks analyst, low volumes due to coronavirus-led economic slowdown are hurting CSX's top line.

Global Expansion Aids Itau Unibanco (ITUB), High Costs A Woe

Per Zacks analyst, strategy to internationalize the bank and diversification supports Itau Unibanco. However, elevated expenses and strict regulations amid coronavirus-induced slowdown are concerns.

Enterprise (EPD) Banks on $6.9B Major Midstream Projects

Enterprise will generate additional fee-based revenues from its $6.9 billion of under-construction key midstream projects. However, significant debt exposure concerns the Zacks analyst.

Strength in CAG Arm Aids IDEXX (IDXX) Amid the Pandemic

The Zacks analyst is upbeat about the CAG arm's strong momentum despite the pandemic. Sturdy gains in Diagnostics recurring revenues buoys optimism.

New Upgrades

Cost Leverage Boosts Monster Beverage's (MNST) Bottom Line

Per the Zacks analyst, cost leverage led to gross and operating margin growth which further aided the bottom line in second-quarter 2020. Adjusted earnings rose 9.9% year over year.

Strong Logic & Foundry To Drive KLA-Tenor's (KLAC) Growth

The Zacks analyst believes that KLA's comprehensive product line and increasing process control spending across foundry and logic players should continue to offer higher growth potential.

Acquisitions & Cost Reduction Actions to Aid Timken (TKR)

The Zacks analyst believes efforts to broaden its portfolio and capabilities across diverse markets through strategic acquisitions as well as its cost reduction actions will drive growth for Timken.

New Downgrades

Promotional Offers & Discounts Hurt T-Mobile (TMUS) Margins

Per the Zacks analyst, low-priced service plans and promotional offers to lure customers from rivals are likely to erode T-Mobile's margins, undermining its growth potential to some extent.

Microchip (MCHP) Hurt by Weak End-Markets & Debt Burden

Per the Zacks analyst, COVID-19 led sluggishness across industrial and automotive end-markets are anticipated to impact Microchip's top line. Further, highly leveraged balance sheet remains a woe.

Elevated Costs, Increasing Provisions Hurt CIT Group (CIT)

Per the Zacks analyst, elevated expenses mainly due to higher technology costs are expected to hurt CIT Group's bottom line. Worsening credit quality amid the current crisis will likely hamper growth.

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PetroChina Company Limited (PTR) : Free Stock Analysis Report
Mastercard Incorporated (MA) : Free Stock Analysis Report
Eli Lilly and Company (LLY) : Free Stock Analysis Report
AnheuserBusch InBev SANV (BUD) : Free Stock Analysis Report
BHP Group Limited (BHP) : Free Stock Analysis Report
Apple Inc. (AAPL) : Free Stock Analysis Report
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