Tuesday - November 20, 2007
 Want to view the archive of past issues? Click here. Manage Profit from the Pros subscription: 1. ZACKS RANK BUY STOCKS Zacks #1 Rank stocks average a 32% annual return. Every day
on Zacks.com we highlight four new Zacks Rank Buy stocks. Each
individual stock is chosen based on how well they match the
criteria for the four main schools of investing: Aggressive
Growth, Momentum, Growth & Income and Value. Aggressive Growth - FLIR Systems, Inc. (FLIR) Astronics Corporation (ATRO) recently reported another great quarter. Sales grew to $37.7 million, a 36% increase compared from sales of $27.8 million in the third quarter of 2006. Net income for the quarter was $4.1 million, up $2.5 million from the third quarter of 2006. These outstanding numbers have not gone unnoticed by investors. The company's stock price has almost tripled in the last seven months and is still locked into a very nice upward trend. Read the full analysis on ATRO now! Both of the covering brokerage analysts raised their 2007 projections on TBS International (TBSI) last week. The revisions pushed the consensus estimate 19 cents higher to $3.05 per share and were in reaction to a bullish third- quarter report. The shipping company exceeded expectations by nearly 25 cents with earnings of 96 cents per share. Read the full analysis on TBSI now!
2. PROFIT TRACKS Zacks.com is proud to share with you some of the best trading strategies that truly allow you to Profit from the Pros. Today we highlight... Profit Tracks: Return on Equity One of the quickest ways to gauge whether a company is creating assets or gobbling up investor's cash is to look at their Return On Equity (ROE). The fast moving ROE Profit Track screening strategy from Zacks.com has generated an impressive return of +21.4% in 2005. In 2006, it continued to outperform the S&P 500, returning +27.0% versus the S&P 500 rise of +16.7%. Here are four stocks that make the grade for the Return on Equity Profit Track: AU Optronics Corporation (AUO) enjoys a ROE of almost 15.3%, which passes the parameter for this profit track of greater than or equal to 10%. The LCD maker has experienced a rise in this year's earnings estimates since its third-quarter report in late October. AU Optronics announced earnings per share and revenue that improved year over year, helping expectations for
2007 rise over the past month. Some highlights in the quarter included a sequential rise of 14.3% for large-sized panel shipments and a rise of 26.3% for small- and medium-sized panel. Given the demand for this Zacks #1 Rank's products and its ROE, AU Optronics appears to be creating assets with positive momentum. Read the full analysis on AUO now! Hertz Global Holdings, Inc. (HTZ) announced solid third- quarter results late last month, including adjusted earnings per share of 65 cents that marked a positive surprise of approximately 14% over the consensus. Revenues increased 9.3% to $2.45 billion, as worldwide car rental revenues moved forward 11%. Looking forward, the company expects 2007 revenue and EPS at the upper end or above its previous guidance. Earnings estimates for this year have been trending higher. Hertz qualifies for this profit track with a ROE of almost 14.2%, a price/sales ratio of 0.66 and a Zacks #1 Rank. Read the full analysis on HTZ now! PartnerRe Ltd. (PRE) is a leading reinsurer that's creating assets, as evidenced by its ROE of 20.8%. Another parameter of this profit track that PRE passes is the price/sales ratio, which is at 0.99. Earnings estimates for this year are up over the past two months and the past 30 days. On Oct 22, PartnerRe announced operating earnings per share of $4.78, which soared past the consensus and year-ago result. Total revenues advanced 7% to $1.2 billion, while net premiums written and net premiums earned rose 8% and 8.5%, respectively. Read the full analysis on PRE now! Valassis (VCI) sports a ROE of 33.5%, which tops this screen's requirement of greater than or equal to 10%. It also has a price/sales ratio of 0.34, which betters the parameter of less than or equal to one. Earlier this month, the marketing services company announced that third-quarter earnings per share of 34 cents eclipsed the analyst consensus by almost 48%.
Furthermore, revenues soared 144% year over year to $607.2 million, thanks in large part to its Mar 2 acquisition of ADVO.
Over the past month, earnings estimates for this year are up. Read the full analysis on VCI now! To see the track details for this winning screen, click here. All the Profit Track strategies were created and backtested using the Research Wizard software from Zacks Investment Research. If you like this screening strategy, but want to narrow down the list of stocks and even improve the performance, then you should start a free trial to this powerful stock picking tool. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Minimizing Market Risk and Volatility with `Beta' Stocks with low betas outperformed the market on average over the last four-week and one-week periods. More... 3. ZACKS EQUITY RESEARCH Real estate investment trusts, or REITS: what lies ahead for this group? Joining us today is Zacks senior REIT analyst Greg Sukenik for his perspective on the industry. Now third quarter earnings is the first time you're able to see the impact of the credit squeeze on real estate companies in your coverage, isn't it? Well, third quarter earnings were relatively good. REITs, on average, reported good FFO [funds from operations] growth of over 10%, which was above our projections. So we would say, operationally, most REITs are still performing quite well. More. . .
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - The credit squeeze has had a negative effect on REITs and the stock market in general. It's much harder to finance deals, buyout activity in the REIT space has slowed a lot, and, in addition, as credit becomes more expensive, property values inevitably have to fall, which will decrease the value of the underlying assets of REITs in their net asset value, or NAV. You've been favorable on apartment REITs over the past few months. How have these companies' earnings looked? The third quarter was generally good for apartment REITs, although it does appear the fundamentals in this sector have peaked after a very good 2006. Rent growth is beginning to moderate, and we do expect this to continue into next year. As the economy softens, it's harder for these companies to push rents like they were doing last year and earlier this year without affecting occupancy. Apartment REITs have been down about 20% this year, although we think a lot of this has to do with investors taking profits off the table after multi- year gains. What would a slowing economy do for the REIT market, should we see one over the next couple quarters? Well, a slowing economy would undoubtedly affect REITs - and all sectors - in a negative way. We're starting to see this already among suburban office building owners and apartment REITs, as occupancies have been relatively flat. Rental rate growth has slowed. In addition, companies with large development pipelines are going to suffer as lease uptakes longer and yields do compress. We're already starting to see this on projected development yields, which are falling due to a slowing economy and what seem to be ever-rising construction costs. So it does seem that fundamentals may have peaked for most sectors, and we don't expect as good of operating results in 2008 as we had this year. To read the complete Analyst Interview, click here. Greg Sukenik is a senior analyst covering the real estate investment trust [REIT] market for Zacks Equity Research. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Real-time market insights from Zacks Equity Research Analysts.Stocks featured recently include ExpressJet Holdings (XJT), Transocean (RIG), El Paso (EP) and Cincinnati Bell (CBB). Get their latest posts: click here. Garmin, Ltd. (GRMN) - Buy on Weaknes. For full Zacks research report, click here. ChoicePoint (CPS) - Mortgage Exposure. For full Zacks research report, click here. Listen to the audio podcast for Earnings Preview through Zacks' Audio Feature. The Week of Nov 19 - Nov 23 Median EPS Growth Strong Find out which stocks have been recently upgraded by Zacks Equity Research: click here. Read the reports on all of the stocks on the Zacks Equity Research Buy List: click here.
4. OPTIONS CENTER Zacks has partnered with the leading options experts, Schaeffer's Investment Research, to provide you the best options commentary, research, and trading tools on the market today. Free Online Options Research on Zacks.com. Zacks/Schaeffer’s Options Trading service. Here is this week's article on how Schaeffer's Tools can help you Profit with Options. Last week, I took a look at Fossil, as it showed up on the Zacks Put/Call Ratio Greater than 1.0 filter. This week, let's shift focus and take a look at Zacks' Most Active Options Filter. According to Zacks, the filter takes a look at the most-active contracts traded in the most recent trading session (Thursday, Nov 15). This activity is significant as large amounts of call or put activity can indicate large speculative or institutional interest in a particular company. It is this reason that Zacks notes that "this list [is] worthy of monitoring daily." Before we dive any deeper into technicals and sentiment for Wal-Mart Stores (WMT), a little background is in order. What is the filter? Well, let's first define a put and a call. A put is simply a bet that the underlying stock is going to move lower, while a call is a bet that the underlying stock is going to move higher. According to our Expectational Analysis(R) methodology, heavy attention paid to puts by investors indicates an increase in pessimism toward an equity, and can present the opportunity for a solid bullish addition to your portfolio. Before looking at WMT specifically, let's address our Schaeffer's methodology. As mentioned above, we are contrarian-based investors, indicating that we want to see skepticism toward an outperforming stock. On the other hand, we typically like to see optimism toward an underperformer. In our eyes, too much optimism is a sign that nearly everyone who wants to invest in a particular stock already has. Just because a stock sees substantial optimism doesn't mean that we will blindly short that particular security; we need to see some negative price action or a major catalyst for a downside move in order to pull the trigger in most cases. Other indicators we use to measure overall sentiment include short interest, magazine cover stories, media comments, and analyst ratings. Last week, Wal-Mart Stores posted a third-quarter earnings surprise with 69 cents per share on revenue of $91.95 billion. The retailer also forecast fourth-quarter earnings of 99 cents to $1.03 per share; analysts expect $1.02 per share. Furthermore, the firm expects full-year 2008 earnings of $3.13 to $3.17 per share, ahead of the consensus estimate of $3.09 per share. It is this better-than-expected news that more than likely triggered the heavy activity on WMT's June 47.50 call (WMTFW). Technically, the shares are stuck in quite the rut, and the heavy optimistic activity on the 47.50 level should be a bit unsettling. The 47.50 level rests directly ahead as the largest roadblock, and the fact that it is the site of heavy call open activity going forward intensifies the potential resistance. Should the stock break through the overhead resistance presented by its 10-month and 20-month moving averages, the 47.50 level looms overhead ready to stop any potential advance. Another reason to suspect that the 47.50 level could provide resistance is that it provided support in the past. The equity relied on this support various times since the turn of the century, so we could see 47.50 relish in the reversed role and thwart any advances. The only pessimistic sentiment that could unwind in the form of buying pressure is provided by the speculative options crowd. WMT's Schaeffer's put/call open interest ratio (SOIR) of 0.69 is higher than 72% of those taken during the past 52 weeks. This high percentile ranking suggests that a sudden shift could help the stock overtake the various levels of overhead resistance the shares face. On the other end of the sentiment spectrum falls the analysts and their views of WMT. According to Zacks, the retailer earns 11 "strong buys," two "buys," and five "holds." This extremely bullish configuration affords far too much of a chance of a rather weighty downgrade.The optimism from the analyst bunch makes WMT an attractive contrarian bearish play, I would like to see a touch more optimism from the options players. Nonetheless, WMT could be a nice bearish addition to any contrarian's portfolio. Make sure to continue utilizing all of the valuable filters on these pages for more money-making ideas. Moreover, don't be afraid to make a few paper trades in order to see what strategy works best for you. Please remember that, when it comes to options, the majority of your trades are going to be losers. Don't get discouraged, because that's the beauty of the leverage that options provide. It takes only a few winners out of every 10 trades to make you a very happy investor. Thanks for reading, best of luck in your trading! To read more thoughts on the market, please visit the Schaeffer's Daily Market Blog section throughout the trading day. To learn more about the Most Active Call Options filter, click here. Discover all the tools and commentary available from the Zacks.com Options Center. Leverage the timeliness of Zacks #1 Rank stocks with options trades that maximize profits and minimize risks. Learn more about our new Options Trading service. 5. Best of the Zacks $100,000 Challenge Zacks is conducting a nationwide talent search to find the very best stock pickers. The winner gets a $100,000 dream job with Zacks! Sign up for free to join the competition, or just read what stocks the leading players are trading on the Zacks Challenge Player Blogs. Best of the Zacks Challenge Player Blogs Here's what the leading players are saying lately: RebelPOW WHAT GAP SCREENS TELL YOU (GRMN) Read More or Comment on this post. DreyerD NOV 19TH WEEKLY TOP 5 WITH CHARTS Read More or Comment on this post. TradeKing1 TRADEKING1'S ROUND TABLE (SEED) Read More or Comment on this post. Read all the Player Blog posts. OTHER TOOLS FROM ZACKS At the heart of Zacks Investment Research is the Zacks Rank investment philosophy that continues to vastly outperform the market. Our Zacks #1 Ranked (Strong Buys) have produced the following results for investors:
And just as importantly, the Zacks #5 Rank stocks (Strong Sell) List has alerted investors as to which stocks to dump from Their portfolios to avoid unnecessary losses. Gain full access to all Zacks Rank resources FREE PORTFOLIO TRACKER Do you believe that these events affect stock prices?
If you answered yes, then how are you staying on top of these changes for your stocks? If you are one of the 60,000 investors who wake up every morning to the Daily Portfolio Updates emails from Zacks.com, then you are all set. If not, then sign up now to get this vital information sent to you daily to help take definitive action to improve your portfolio's performance. Did we mention it's free? Get started now! We hope you enjoyed this issue of "Profit from the Pros", And we look forward to visiting with you again next week. REFER-A-FRIEND If you enjoy this e-mail newsletter, then please pass it along to a friend. Simply forward them the link below to sign up for their own free subscription. If you're reading a forwarded copy, sign up for your own, so you get this wealth of information every week. Just click here. THANKS! Regards and Happy Investing, Charles Rotblut, CFA p.s. What is the mission for Zacks Profit from the Pros? Click here to find out how we will help you become a more successful investor. The performance of the Zacks Rank portfolios shown above for annual and year-to-date periods are the linked monthly total returns (price changes + dividends) of equal weighted hypothetical portfolios, consisting of those stocks with the indicated Zacks Rank, assuming monthly rebalancing and zero transaction costs. These are not the returns of actual portfolios. The hypothetical portfolios were created at the beginning of each month from Jan 1988 forward based on the values of the Zacks Rank available to Zacks' clients before the beginning of each month. The portfolios created monthly from 1988 through September 2006 exclude ADRS and are comprised of stocks that have the indicated Zacks Rank and were covered by at least two analysts at the time of the stocks inclusion in the portfolio. Starting in October 2006 and going forward, the portfolios are comprised of all stocks with the indicated Zacks Rank and do not exclude ADRs, which is more reflective of the list of stocks that customers will find on the Zacks web sites. 2007 returns are for the period of Jan 1 - Jun 30, 2007. These performance numbers have been audited from 1995 through 2003 by Autschuler Melovan, a division of American Express Financial. The S&P 500 Index is a well-known, unmanaged index of the prices of 500 large-company common stocks, mainly blue-chip stocks, selected by Standard & Poor's. The S&P 500 Index assumes reinvestment of dividends but does not reflect advisory fees. An investor cannot invest directly in an index. Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security. To contact us by mail: Zacks Investment Research To unsubscribe from receiving "Profit from the Pros" e-mail newsletter, click here. | |||||||||
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Zacks #1 Stocks on the Move 05/17/2013
| Company Name | Symbol | %Change |
|---|---|---|
| VIASAT INC | VSAT | 19.35% |
| OLD SECOND B | OSBC | 5.76% |
| GAMCO INVEST | GBL | 4.61% |
| CORNING INC | GLW | 4.47% |
| SYNCHRONOSS | SNCR | 4.23% |
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