November employment report shows stronger-than-expected hiring momentum amid uncertain macroeconomic conditions. Despite a string of layoffs, mostly in tech, demand for workers continues to outpace the number of unemployed people looking for work.
This steady employment growth has kept consumer spending strong, which is set to receive a further boost from slowing inflation. Moreover, the Fed's slowing interest rate hikes should further boost consumer sentiment.
In such a scenario, it could be wise not to miss out on fundamentally sound stocks Biogen Inc. (BIIB), APA Corporation (APA), and Nathan’s Famous, Inc. (NATH) to boost your portfolio returns.
Biogen Inc. (BIIB)
BIIB develops, manufactures, and delivers therapies for treating neurological and neurodegenerative diseases. The company has a leading portfolio of medicines to treat multiple sclerosis, has introduced the first approved treatment for spinal muscular atrophy, and developed the first and only approved treatment to address a defining pathology of Alzheimer’s disease.
On November 29, BIIB and Eisai Co., Ltd. (ESALY) announced the release of the results from ESALY’s large global Phase 3 confirmatory Clarity AD clinical study of lecanemab, an investigational anti-amyloid beta (Aβ) protofibril antibody for the treatment of mild cognitive impairment (MCI) due to Alzheimer’s disease (AD) and mild AD (collectively known as early AD) with confirmed presence of amyloid pathology in the brain.
This is yet another step towards the efficacy and safety of an agent in development to treat MCI.
On October 17, BIIB announced that the U.S. Food and Drug Administration (FDA) extended the new drug application (NDA) review period for tofersen by three months. This follows responses submitted by BIIB to information requests by the FDA, which the FDA considered a Major Amendment to the application that will require additional time for review.
On the same day, BIIB and Sage Therapeutics, Inc. (SAGE) presented additional data from the Phase 3 SKYLARK Study of zuranolone in adult women with postpartum depression (PPD), at the 35th European College of Neuropsychopharmacology (ECNP) Congress. The company has found the results of the study satisfactory.
During the fiscal third quarter, ended September 30, 2022, BIIB’s total revenue came in at $2.51 billion, registering a slight year-over-year decline due, in part, to a decrease in multiple sclerosis revenues, including royalties on sales of OCREVUS. The total cost and expenses declined 54.3% year-over-year to $1.14 billion.
BIIB’s total assets stood at $24.85 billion as of September 30, 2022, compared to $23.88 billion as of December 31, 2021. The non-GAAP quarterly net income attributable to BIIB came in at $691.2 million, or $4.77 per share.
Analysts expect BIIB’s EPS for the fourth quarter of the current fiscal year (ending December 2022) to increase 2.9% year-over-year to $3.49. The company has surpassed consensus EPS estimates in three of the trailing four quarters, which is impressive.
The stock has gained 5.7% over the past month and 23.6% year-to-date to close the last trading session at $301.85.
BIIB’s fundamental strength is reflected in its POWR Ratings. It has an overall rating of A, equating to a Strong Buy in our POWR Ratings system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.
BIIB also has grade A for Value and Quality and grade B for Sentiment. It is ranked #7 among 379 stocks in the Biotech industry.
To see additional POWR Ratings for Growth, Momentum, and Stability for BIIB, click here.
APA Corporation (APA)
As an independent energy company, APA explores, develops, and produces natural gas, crude oil, and natural gas liquids (NGLs). The company operates in the United States, Egypt, and the offshore United Kingdom in the North Sea, Suriname, and other international locations.
On November 28, APA updated drilling operations had concluded at the Awari exploration prospect in the previously untested northwest portion of Block 58 of Suriname. APA holds a 50% working interest, while TotalEnergies (TTE) is the operator on the block with a 50% working interest.
On November 14, APA announced the achievement of a compensation-linked environmental, social, and governance (ESG) goal to reduce upstream routine flaring across Egypt operations by 40%. The goal was reached ahead of schedule and is the result of numerous emissions reduction projects executed in Egypt throughout 2022.
For the third quarter of fiscal 2022 ended September 30, 2022, APA’s total revenues came in at $2.89 billion, up 40.2% year-over-year. During the same period, APA’s adjusted earnings came in at $651 million or $1.97 per share, up 75% and 101% year-over-year.
Analysts expect APA’s revenue and EPS for the current fiscal year (ending December 31, 2022) to increase 33.5% and 114.2% year-over-year to $10.72 billion and $8.35, respectively.
The stock has gained 1.4% over the past month and 66.5% year-to-date to close the last trading session at $46.72.
APA has an overall POWR Rating of B, which translates to a Buy in our proprietary rating system. The stock has grade A for Momentum and Quality and grade B for Sentiment.
APA is ranked #10 of 92 stocks in the B-rated Energy – Oil & Gas industry.
Click here to learn the additional POWR Ratings for Growth, Value, and Stability for APA.
Nathan’s Famous, Inc. (NATH)
NATH operates in the food service industry as an owner of franchise restaurants under Nathan’s Famous brand name. The company also sells products bearing Nathan’s Famous trademarks through various distribution channels.
Today, NATH paid its quarterly dividend of $0.45 per share. The company pays $1.80 annually as dividends, translating to a yield of 2.70% at the current price, better than the four-year average dividend yield of 2.31%.
NATH’s total revenues increased 14% year-over-year to $37.50 million in the fiscal second quarter ended September 25, 2022. During the same period, the company’s Adjusted EBITDA and income from operations increased 32.8% and 33.3% year-over-year to $10.32 million and $9.91 million, respectively.
NATH’s quarterly net income came in at $5.96 million or $1.46 per share, up 68.1% and 69.8% year-over-year, respectively.
The stock has gained 2.5% over the past month and 13.1% year-to-date to close its last trading session at $66.64.
It’s no surprise that NATH has an overall A rating, which translates to Strong Buy in our POWR Rating system. It has an A grade for Quality and a B for Stability and Sentiment.
As a result, NATH tops the list of 45 stocks in the B-rated Restaurants industry.
To see the additional POWR Ratings for Growth, Value, and Momentum for NATH, click here.
BIIB shares were trading at $298.96 per share on Friday afternoon, down $2.89 (-0.96%). Year-to-date, BIIB has gained 24.61%, versus a -13.34% rise in the benchmark S&P 500 index during the same period.
About the Author: Santanu Roy
Having been fascinated by the traditional and evolving factors that affect investment decisions, Santanu decided to pursue a career as an investment analyst. Prior to his switch to investment research, he was a process associate at Cognizant. With a master's degree in business administration and a fundamental approach to analyzing businesses, he aims to help retail investors identify the best long-term investment opportunities.
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