Tuesday - November 30, 2004
 Want to view the archive of past issues? Go here. Get Profit from the Pros content in Real Time. Learn more about this free tool at: http://at.zacks.com/?id=1452. Manage Profit from the Pros subscription: 1. FEATURED EXPERTS Here we cast the spotlight on a timely Featured Expert commentary that recently appeared on Zacks.com. Following the article you will find previews of other profitable commentaries with insights and recommendations from leading investment experts.
MARKET OUTLOOK Stocks declined last week after a strong post-election rally. The S&P 500 suffered the biggest decline in falling 1.2%. The Nasdaq Composite and the Dow Jones Industrial Average suffered more modest losses of 0.7% and 0.8%, respectively. The S&P 500 was particularly hard hit due to its pharmaceutical and biotechnology exposure after questions arose over the U.S. regulatory process. This followed the news of deaths related to Merck`s Vioxx drug. The concern is that the approval process may become more difficult and/or take longer to complete. While this may not be the case with drugs offering a clear-cut benefit, marginal drugs may in fact face more scrutiny. Federal Reserve Chairman Alan Greenspan also helped to dampen enthusiasm last week when speaking before the European Banking Congress he said that there would have to be a diminished appetite for dollar-based securities at some point. Approximately $3 billion per day in foreign investment is needed to fund the U.S. current account deficit He also hinted that further interest rate increases were on the way. There is further credence added to the argument calling for higher interest rates after last week`s Consumer Price Index soared 1.7% during October. While the core rate, which excludes food and energy prices, rose a much more subdued 0.3%, both figures are above what the Fed would deem acceptable over the long term. In addition to the figures on inflation, new housing starts in October were also above expectations. Only a small decline in the index of leading economic indicators pointed toward a moderating economy over the past week. More. . .
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Despite the stock market`s decline over the past few days, the fundamental picture remains unchanged. The potential challenges have merely been highlighted. We still expect the economy to grow at a solid pace over the next year and that earnings will grow at above average rates. As such, we are confident the potential rewards outweigh potential risks over the next 12 months for stock investors. Wilshire Bancorp (NASDAQ: WIBC) today declared a 2-for-1 stock split. The additional shares will be paid on December 14 to shareholders of record on December 3. Shareholders will receive one additional share of WIBC common stock for each share owned. Ditech Communications (DITC) shares fell again last week after the company reported its fiscal second quarter results. The company dropped sharply two weeks ago after warning that its results would not meet expectations. Revenues for the second quarter were $24.3 million, a 67% increase from the same quarter last year. Income was $10.3 million, or $0.29 per share, a 256% increase over the same period a year ago. The company said revenues would drop next quarter before rebounding in the fiscal fourth quarter. Ditech should be reviewed for possible sale. Autodesk (NASDAQ: ADSK) shares spiked higher on Friday after the company reported third-quarter earnings of $48 million, or $0.38 per share, versus $23 million, or $0.20 per share, in the same period a year ago. The results were four cents above expectations. The company also said that for next year it expects to earn $2.00 to $2.15 per share on revenue of $1.33 billion to $1.38 billion. Analysts had been expecting earnings of $1.87 per share on revenue of $1.29 billion. In addition, Autodesk declared a 2-for-1 stock split, payable December 20 to shareholders of record December 6. Innovative Solutions & Support (NASDAQ: ISSC) rose after the company reported earnings of $4.5 million, or $0.37 per share, a 60% increase from the $2.8 million, or $0.23 per share, reported during the same period a year ago. The results were $0.08 above expectations. As of September 30, the company’s backlog reached a record $35.4 million and management indicated business demand is expected to remain strong. OTC Insight® specializes in growth stocks, particularly in the small to mid-cap range. This monthly publication, which focuses on Nasdaq listed stocks, is a by-product of the research we use to select stocks for our managed client portfolios through Insight Capital Research and Management, Inc.® Learn more about this newsletter and free trial offer at: http://at.zacks.com/?id=342. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Bill Martin and Matt Ragas are bullish on Homestore and are
keeping their eyes on bids for Sprint’s wireless tower business.
Use their analysis on these topics and others to generate profit
heading into the new year. More... David Moenning highlights the critical economic events coming
this week and explains why the bulls are rearing their horns. More... d) Bullish Sentiment Has The Upper Hand Dennis Slothower believes the market could continue to generate
some heat, as bullish sentiment remains high. Use this expert’s
technical analysis to better your mutual fund portfolio. More... In his most recent issue of the Chartist, Dan Sullivan points
out how being invested during a specific six month period of a
given year is historically more rewarding. Although the “six
month strategy” is alluring, there will always be exceptions. More... Richard Rhodes discusses the effects of the US Dollar plummeting
against the Euro. Learn about the relationship between these
currencies, and then take a look at several stocks from this
expert’s Trading Positions list. More... Featured Expert articles are courtesy of the 60+ leading investment newsletters that have partnered with us to create the Zacks Expert Advice service. Check out the Experts section of Zacks.com daily to find profitable stock picks and timely market commentary at: http://at.zacks.com/?id=1340.
2. WEEKLY COMMENTARY: All Star Top Picks Zacks.com offers 3 unique weekly commentaries that all further
our mission to help you Profit from the Pros. Today we will
uncover the current top picks of 5 Star analysts in a hot sector
(aka All Star Top Picks). Why? First, it makes sense to tap into
industries that have potential to outperform the market. Second,
within that sector you want to be on board the stocks with the
best prospects. To help us uncover these top picks we employ the
keen insights of 5-Star analysts. Who are they? Check out the
"About Zacks All Star Analyst Survey" section below. This week we explore the Retail Industry As of this writing, the retail industry is in the midst of Black Friday. The day after Thanksgiving is widely regarded as the biggest shopping day of the year, as millions of consumers take advantage of a day off and heavy promotion from retailers to begin their Christmas shopping. However, many analysts are not as encouraged as in years past, since consumers still have a number of factors pressuring their spending dollars. Nevertheless, the clothing retail industry enjoys a Zacks Industry Rank of 3.00, according to Nick Raich’s “Weekly Earnings and Sector Update,” placing it 95th out of more than 200 industries. All retail companies were not created equal, and the All Stars can pinpoint those companies best positioned for success this holiday season and beyond. While analysts may not be very jolly for this year’s Christmas season, they had to admit that October’s sales results were better than expected. A number of retailers, such as those profiled below, reported results that exceeded cautious estimates, as October lived up to its reputation as a clearance month. ”We thought results could be strong for the handful of retailers that had nailed the fashion-right trends on the head, fell into the luxury category, or had managed inventory well enough to avoid falling into the excessive promotion trap,” said 5-Star analyst Katherine Galligan of Aperion Group, LLC in a recent research report. “We underestimated how well.” One of the main reasons for October’s advance was cool weather. In fact, according to Planalytics, November is shaping up to be a colder month than last year, which should be a good first step for holiday sales as consumers rush out to buy sweaters, coats, etc. Other factors that aided the month’s performance included more favorable comparisons with the previous year, along with merchandising and product initiatives. However, analysts are still staying quite cautious when it comes to December. But as Galligan pointed out, there are a handful of retailers better positioned than others to succeed. These are companies that have momentum heading into the holidays, and have also managed their businesses well enough to give them an edge. Such characteristics are not often easy for investors to notice, which makes the insight of these analysts all the more important. In addition, a successful investment in clothing retail also means that the investor must be aware of popular trends in what could be unfamiliar demographics, such as what is popular with teenagers or what’s hot in the ‘board culture.’ Analysts can help answer these questions and, therefore, put you in a position to truly have a Merry Christmas and Happy New Year. The answers to these questions are found in the remainder of this All Star Top Picks article at: http://at.zacks.com/?id=1451. To see the full All Star Survey with access to all ratings, research and stock picks, then visit: http://at.zacks.com/?id=12. These are the best stock picks from the best stock pickers in the business. This portfolio only includes stocks recommended by five or more of the 5-Star analysts based on stock picking performance. In 2003 it gained 46.6% nearly doubling the performance of the S&P 500. See the full portfolio at: http://at.zacks.com/?id=13. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - What sectors are hot? What sectors are not? Read on for full
details and favorite sector stock picks. More... Great Stocks often have some Great Peers Kevin Matras looks at how to find winning stocks in the
winningest Sectors, and shows how to find more of them! Plus,
get 3 top picks from the top 3 Sectors. More... 3. BEST OF ZACKS INDEPENDENT RESEARCH The analysts from Zacks Independent Research create a mountain of insightful equity research everyday of the week. Here you will find the best of that information recently published on Zacks.com. BULL OF THE DAY Medtronic (MDT) - Wider Use of Heart Treatment Products Kansas City Southern (KSU) - Acquisition Brings Credit Downgrade Bank Loan Generation Beginning to Dwindle Good Buys Remain in Non-Ferrous Metals Modest Third Quarter Growth May Lead to Late-Year Positivity
4. TRADING STRATEGIES: 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: Upgrades & Revisions Strategy This strategy focuses primarily on Positive EPS Estimate Revisions and Brokerage Rating Upgrades. Over the last 20 years Zacks Investment Research has proven that “earnings estimate revisions are the most powerful force driving stock prices.” Studies have also shown that stocks receiving upward EPS revisions tend to receive additional upward revisions in the future. Then consider that stocks receiving these upward revisions generally have brokers upgrading their Ratings, which is also a proven mover of stock prices. There are other parameters to this strategy, but the Rating Upgrades and positive EPS Revisions are the two powerful active ingredients. This screen focuses on EPS Revisions, along with Ratings and Rating Changes. According to Zacks Investment Research “earnings estimate revisions are the most powerful force impacting stock prices”. Couple that with the proven benefits of upgrades in ratings from brokerage firms and you have a strategy with a compounded return of over 330% over the last few years. (1/5/01- 10/8/04) Archer Daniels Midland Company (NYSE: ADM) is engaged in the business of procuring, transporting, storing, processing and merchandising agricultural commodities and products. It is one of the world's largest processors of oilseeds, corn and wheat. The company recently reported a 77% jump in quarterly earnings on improved valuation of its inventory and growth in oilseed and bioproducts. Analysts also expect the companies costs to decline over the next several quarters thanks to a strong harvest and its earnings estimates are up for this year and next. Continue your research on ADM at: http://at.zacks.com/?id=1366. MicroStrategy (NASDAQ: MSTR) is a leading worldwide provider of business intelligence software and related services. The company recently reported a 42% increase in third-quarter revenue, thanks to a large tax gain. The company grew licensing revenue by 46% and turned to a significant profit, blowing away the consensus estimates. Earnings estimates for this quarter are up more than 18% over the last 4 weeks and the stock has a Zacks Rank of 1. Continue your research on MSTR at: http://at.zacks.com/?id=1368. Toll Brothers Inc. (NYSE: TOL)designs, builds, markets and arranges financing for single-family detached and attached homes in middle and high income residential communities in thirteen staes and five regions around the country. Earnings estimates for the company are soaring through the end of 2005 as demand for luxury homes remains strong. Continue your research on TOL at: http://at.zacks.com/?id=1367. To see the full list of stocks that currently pass this winning screen, then click here. More. . .
5. OPTIONS CENTER Zacks has partnered with the leading options experts, Schaeffers Investment Research, to provide you the best options commentary, research and trading tools on the market today. Read below more on Schaeffers Tools to Profit with Options. As we pointed out last week, the stock had received some positive legal news and that alone could have been the catalyst needed to push the shares higher, but we noticed something else. Although the calls after the ruling showed that the crowd was quickly becoming optimistic on the future of RMBS, a deeper look at the sentiment revealed the overall picture was quite pessimistic. From our contrarian point of view, we love to see a stock that is disliked, experience some positive news as it could lead to a massive short covering rally on the positive news. Once we saw RMBS had a very significant level of bearish shorts against it, coupled with a very few “buy” ratings from the analysts community, we had our contrarian play. As Ryan Detrick, author of Schaeffer’s Opening View, put it “Although there is some recent signs of optimism toward the shares, there is still plenty of skepticism left.” Now to the fun part, using the filter and doing a few minutes of research, on the afternoon of Friday, November 19 you could have bought some short-term December 20 calls for $2.10 a contract. Was the filter right? You bet it was. The RMBS stock closed at $20.64 a share on Friday and traded as high as $22.90 on Monday the NEXT DAY! That my friend equals a massive move of a little less than 11% - in ONLY one day. Thank you: Unusually High Call Volume filter! But wait a minute, what about the beauty of options and that December 20 call we could have bought? Well, in as little as a few market hours, you could have sold those contracts that you bought for $2.10; for as much as $3.40. That comes out to a 62% PROFIT IN LESS THAN A DAY! What does it all mean? Nothing works every time nor does it always work out as well as RMBS did, but with the proper use of the Unusually High Call Volume filter, along with a little additional research, you can potentially, find huge winners just like RMBS with the help of options. To learn more about the Unusually High Option Volume, click here. Dr. Edward Olmstead shows readers how to capitalize on positive
momentum while limiting losses through options. Use his
expertise on a pair of option trades from the construction and
transportation sectors. More... b) Beware the Post-Election Rally Jeff Carter and his team warn that this spike in the election
aftermath is in danger of descending in the same manner that it
rose. Therefore, this expert is guarding against a potential
downfall, but remains bullish enough to highlight a pair of
option trades. More... Discover all the tools and commentary available from the Zacks.com Options Center at: http://at.zacks.com/?id=614. 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, our #5 Ranked stocks (Strong Sells) have alerted investors as to which stocks to dump from their portfolios to avoid unnecessary losses. To truly take advantage of the Zacks Rank, you need to first understand how it works. That`s why we created the free special report; Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. Download a free copy now to prosper in the years to come at: http://at.zacks.com/?id=1346. Or view the full list of Zacks #1 Ranked stocks at: http://at.zacks.com/?id=1353. 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 45,000 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, Stephen Reitmeister 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 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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