Top Analyst Reports for Merck, Palo Alto & Freeport

Thursday, August 14, 2025

The Zacks Research Daily presents the best research output of our analyst team. Today's Research Daily features new research reports on 12 major stocks, including Merck & Co., Inc. (MRK), Palo Alto Networks, Inc. (PANW) and Freeport-McMoRan Inc. (FCX), as well as a micro-cap stock Espey Mfg. & Electronics Corp. (ESP). The Zacks microcap research is unique as our research content on these small and under-the-radar companies is the only research of its type in the country.

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 >>>

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You can read today's AWS here >>> Economic Data at 3-Year Highs: PPI, Jobless Claims

Today's Featured Research Reports

Shares of Merck have underperformed the Zacks Large Cap Pharmaceuticals industry over the year-to-date period (-15.7% vs. -4.2%). Rising competitive and generic pressure on some drugs and persistent challenges for Gardasil in China remain overhangs for the company. There are concerns about Merck’s ability to successfully navigate the Keytruda loss of exclusivity and potential competition for the drug. 

Nevertheless, Merck’s second-quarter earnings beat estimates while sales met. Its blockbuster drug, Keytruda, and new products have been driving sales. With label expansion into new indications, particularly earlier-stage launches, Keytruda is expected to see continued growth. 

Animal health is also contributing to growth. Merck has been making meaningful pipeline progress. It is also actively pursuing M&A deals to enhance its pipeline and diversify away from Keytruda.

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

Palo Alto’s shares have gained +2.6% over the past year against the Zacks Security industry’s gain of +21%. The company has been benefiting from continuous deal wins and the increasing adoption of its next-generation security platforms, which are attributable to the rise of the hybrid work trend and the heightened need for stronger security.

PANW’s strong back-to-back quarterly performances reflect its sustained focus on product innovation, a shift in its business model to subscription-based services, platform integration and continued investments in the go-to-market strategy. The normalization of the supply chain is also aiding growth across the Products, Services and Subscription segments. 

However, softening IT spending amid macroeconomic headwinds may hurt its near-term prospects. Forex headwinds and higher marketing and sales expenses are likely to continue hurting its profitability. Also, high acquisition-related expenses are denting margins.

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

Shares of Freeport have outperformed the Zacks Mining - Non Ferrous industry over the year-to-date period (+11% vs. +6.8%). The company’s adjusted earnings and sales for the second quarter beat the respective Zacks Consensus Estimate. Freeport is conducting exploration activities near existing mines to expand reserves. It is expected to gain from progress in exploration activities that will boost production capacity. 

Freeport is executing several smelter projects in Indonesia. It is also well-positioned to benefit from automotive electrification, which is positive for copper, as electric vehicles are copper-intensive. The company's efforts to reduce debt are also encouraging. 

However, weak copper volumes may also hurt its performance. Sizable capital spending is also likely to impact free cash flow generation. Copper prices also remain volatile amid trade uncertainties.

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

Espey Mfg. & Electronics’ shares have outperformed the Zacks Electronics - Military industry over the year-to-date period (+59.6% vs. -20.7%). This microcap company with a market capitalization of $134.46 million posted strong YTD FY25 results, with revenue up 26.7% to $34.4 million, driven by defense power supply programs and improved gross margins. Its record $138 million backlog — anchored by long-term contracts and key customer relationships — provides multi-year revenue visibility, with nearly half scheduled beyond FY26. 

Strategic wins include $49.3 million in multi-year contracts for the U.S. Navy’s Columbia-class submarines, supporting long-term positioning in electrification systems. A debt-free balance sheet, $28.3 million in liquidity, and $10.8 million in federal funding for capacity upgrades enhance strategic flexibility and throughput. 

Espey benefits from defense modernization tailwinds, especially in naval and airborne electrification. However, risks include persistent margin headwinds from early-stage programs, fixed cost pressures, and high customer concentration. 

(You can read the full research report on Espey Mfg. & Electronics here >>>)

Other noteworthy reports we are featuring today include Telefónica, S.A. (TEF), PPL Corp. (PPL) and Antero Midstream Corp. (AM).

Mark Vickery
Senior Editor

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

Keytruda Drives Merck (MRK) Sales Amid Gardasil Issues

Palo Alto (PANW) Rides on Shift to Subscription Services

Exploration Progress, Debt Reduction to Aid Freeport (FCX)

Featured Reports

Telefonica (TEF) Rides on Robust 5G Coverage Amid Forex Woes
Per the Zacks analyst, Telefonica's extensive 5G footprint across Spain, Germany and Brazil is solidifying its position. However, global macroeconomic uncertainty and forex volatility are concerning.

Investments, Clean Generation Focus Aid PPL Corporation (PPL)
Per the Zacks analyst, PPL's strategic investment of $20 billion during 2025-2028 should strengthen its infrastructure. Focus on renewables projects should further boost margins.

Antero Midstream (AM) Shines on Fee-Based Revenue Stability
Per the Zacks analyst, Antero Midstream's long-term fee-based contracts ensure predictable cash flows, supporting steady dividends, debt reduction, and sustained shareholder value in 2025.

Strong Solvency, New Launches Boost Globus Medical (GMED)
Globus Medical exited the second quarter of 2025 with no long-term debt, boasting solid financial stability amid an overall tough macroeconomic landscape. Furthermore, new product launches aid growth.

Fee Income to Support Bank OZK (OZK), Asset Quality Weak
Per the Zacks analyst, fee income, high rates, efforts to boost mortgage banking business and diverse loans will likely aid Bank OZK's financials. Yet, weak asset quality and high costs are woes.

New Upgrades

Low Fuel Costs & Fleet Upgrade Efforts Aid SkyWest (SKYW)
The Zacks analyst likes the company's efforts to modernize its fleet. Low fuel costs are aiding the regional carrier's bottom line.

Wolverine's (WWW) Product Initiatives to Boost Market Share
Per the Zacks analyst, Wolverine is actively pursuing a comprehensive strategy to enhance brand portfolio, focusing on Merrell and Saucony brands. These efforts are expected to help gain market share.

New Downgrades

AI Tax Assist Benefits H&R Block (HRB) Amid Low Liquidity
Per the Zacks Analyst, integration of a generative AI-powered technology, AI Tax Assist, in H&R Block's DIY tax preparation boosts top line. Low liquidity is concerning.

Inflation, Tariffs, and Costs Strain Carter's (CRI) Margins
Per the Zacks analysts, Carter's profitability remains pressured as cost inflation, higher clearance activity, tariffs, and FX headwinds continue to weigh on margins despite strategic investments.

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This article originally published on Zacks Investment Research (zacks.com).

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