CHICAGO, May 5, 2011 /PRNewswire/ -- Zacks Equity Research
highlights Eastman Chemical Company (NYSE: EMN) as the Bull
of the Day and PMI Group Inc (NYSE: PMI), as the Bear of the
Day. In addition, Zacks Equity Research provides analysis on
ValueClick Inc. (Nasdaq: VCLK), Google Inc. (Nasdaq:
GOOG) and Yahoo! Inc (Nasdaq: YHOO).
(Logo:
http://photos.prnewswire.com/prnh/20101027/ZIRLOGO)
Full analysis of all these stocks is available at
http://at.zacks.com/?id=2678.
Here is a synopsis of all five stocks:
Bull of the Day:
Eastman Chemical Company (NYSE: EMN) delivered EPS of
$2.52, significantly beating the
Zacks Consensus Estimate of $1.97.
Revenues of $1.8 billion, which
outpaced the Zacks Consensus Estimate of $1.5 billion, were driven by higher sales volume
and increased selling prices.
Eastman Chemical's revenue increased by double digits in all
regions and the growth was driven by the company's growth
initiatives as well as the rebound in the global economy. EMN is
also upbeat about the restart of an olefin cracking unit, lower
interest expense, its full-year results from the company's
Genovique Specialties acquisition and its acetate tow expansion in
Korea.
In the second quarter, earnings per share are expected to be
slightly better than the first quarter. Based on the strong first
quarter results and the second quarter outlook, we are maintaining
our Outperform recommendation and a target price of $129.00.
Bear of the Day:
PMI Group Inc's (NYSE: PMI) fourth quarter operating loss
widened from Zacks Consensus Estimate due to continued large losses
and lower premiums earned partially offset by lower underwriting
and operating expenses. We expect losses and loss adjustment
expenses from mortgage insurance operations, increased valuation
allowances and lower premiums earned.
The company is also effectively lowering delinquency rates.
Though the company may benefit from the recent U.S. regulatory
moves to reduce foreclosures, we expect results to remain pressured
in the coming quarters until the housing situation bottoms out.
Valuation looks stretched on a price-to-book basis, given a
negative trailing 12-month ROE, versus a positive 11.9% for the
industry average. Our six-month target price of $1.75 is based on 0.68x our estimated book value
of $2.58 per share.
Latest Posts on the Zacks Analyst Blog:
ValueClick Beats Estimates
ValueClick Inc. (Nasdaq: VCLK) reported first quarter
2011 earnings (including stock-based compensation but excluding
amortization of intangibles) of 24
cents per share. The EPS comprehensively beat the Zacks
Consensus Estimate of 18 cents and
was up 41.2% year over year from 17
cents per share reported in the prior-year quarter.
Earnings on a non-GAAP basis (excluding both amortization of
intangibles and stock-based compensation expense) came in at
26 cents per share, well above
management's guidance range of 21 cents to
22 cents. This also surpassed last year's earnings of
19 cents per share.
Sales and technology investments made in the previous year
positively impacted the results in this quarter.
Revenues, adjusted EBITDA and earnings per share exceeded
management's guided range that was provided last quarter.
Guidance
For the forthcoming quarter management expects revenues in the
range of $120–$122 million.
On a yearly basis, the company expects revenues from Media and
Affiliate Marketing to grow in the mid double-digit percentage
range. Owned & Operated websites are expected to increase in
the low-twenties range. Technology is expected to grow in the high
single-digits to low double-digits range.
Adjusted EBITDA is expected in the range of $34.0–$35.0 million, which represents a adjusted
EBITDA margin of 28.5% at the mid-point.
Earnings on a GAAP basis are projected to be in the range of
19 cents-20 cents per share, while
earnings on a non-GAAP basis are expected to be between
25 cents and 26 cents.
Our Take
Strength in the Internet advertising industry, increasing
e-commerce spending,improving display ad growth trends in the U.S.,
synergies from the Investopedia acquisition, share repurchases,
impressive cash flow and a debt-free balance sheet are the
positives for the company.
We also remain upbeat on ValuClick's growing Affiliate Marketing
segment and expect a rebound in its Owned and Operated business. We
are also optimistic about the media section of the company, where
it has made an acquisition and expects a positive revenue
contribution of around $4.0 million
in the coming quarter.
However, intense competition from Google Inc. (Nasdaq:
GOOG) and Yahoo! Inc (Nasdaq: YHOO) is reason for concern.
Although we expect the company to deliver improved results in 2011
on an accelerating top line, we maintain our Neutral rating on the
stock, awaiting sustained growth.
Currently, we have a Zacks #2 Rank for ValueClick, which
translates to a short-term Buy rating.
Get the full analysis of all these stocks by going to
http://at.zacks.com/?id=2649.
About the Bull and Bear of the Day
Every day, the analysts at Zacks Equity Research select two
stocks that are likely to outperform (Bull) or underperform (Bear)
the markets over the next 3-6 months.
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