Wednesday - February 21, 2007
 Want to view the archive of past issues? Click here. Manage Profit from the Pros subscription: 1. ZACKS RANK BUY STOCKS Zacks #1 Ranked stocks average a 31.8% 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 – Pinnacle Airlines (PNCL) Pinnacle Airlines (PNCL) entered into a new capacity purchase agreement with Continental Airlines, Inc. Pinnacle Airlines Corp.'s wholly owned subsidiary, Colgan Air, Inc., will operate fifteen 74-seat Bombardier Q400 regional aircraft as a Continental Connection carrier. The shares are up a whopping 176% since it was first featured. Read the analysis of PNCL now! Growth & Income – Estee Lauder Cos. (EL) The Board of Directors at Estee Lauder Cos. (EL) approved the repurchase of up to another 20 million Class A shares, upping the total buyback authorization to 68 million shares. The company is up nearly 18% since its debut as a Growth and Income pick on Jan 18. Read the full analysis on EL now! Momentum – Corrections Corporation of America (CXW) On Jan 25, Corrections Corporation of America (CXW) has nearly doubled in price since it was featured as a Momentum Stock of the Day on Aug 9, 2006. In recent news, CXW reported earnings on Feb 8, reporting EPS of 52 cents, up 30% from the same quarter last year and an 18% positive surprise above analysts’ expectations. Sales grew 10.6% to $349.6 million and income rose 51% to $32.15 million. Immediately after the earnings report, CXW set a new historic high of $54.00. Since the report, the stock has backed off slightly but remains within striking distance of the high. Given that CXW has delivered six straight positive earnings surprises, this stock is likely to continue moving higher. Read the analysis of CXW now! Value – Imperial Sugar Company (IPSU) Imperial Sugar Company (IPSU), first presented as a Value pick on Jan 11, has returned 26% in just over a month. The company topped the Street's earnings estimate for the past three quarters, most recently by 53.9%. IPSU managed to surprise to the upside by a double-digit percentage in all three quarters. Consensus earnings estimates continue to trend higher for the company. Read the full analysis on DB now!
2. SCREEN OF THE WEEK Zacks.com offers three unique weekly commentaries that all
further our mission to help you Profit from the Pros. Today is
the latest installment of Screen of the Week from Kevin Matras.
Each week, Kevin shares with you another winning screen he has
discovered using the Research Wizard software from Zacks
Investment Research. Click here to learn more about the Research Wizard. Best Buys I’m excited to share a new screen with you this week. It’s a very robust strategy in and of itself, and works exceedingly well with many of our other strategies that come loaded with the Research Wizard program. The parameters are:
Results I ran a series of separate tests over the last six-year time span using a four-week holding period and starting each run on a different start date to eliminate coincidence and to verify robustness. In 2001, this screen showed an average compounded gross return of 51.4%. In 2002, it showed a 36% return. 2003; a whopping 91.2% return. 2004 showed a 35.9% return. 2005 was 44.4%. And in 2006, the average compounded gross returns were 58.4%. I’ve also been experimenting with a slightly higher percentage of Strong Buys/Buys and have found that 60% does very well too. But much higher than that starts diminishing returns instead of increasing them. Give this strategy a try in your own trading and see how it can help you pick better stocks. This strategy always picks only five stocks per run. Here are three of them for this week (Tuesday 2/20/07):
Sign up now for your two-week free trial to the Research Wizard and get the rest of the stocks on this list. Start trading this strategy today. And don’t forget to check out the other winning trading strategies that come loaded with the program. Know when to buy and when sell. It’s all there. Discover all the Free Screening Tools on Zacks.com now! Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. 3. ZACKS EQUITY RESEARCH As the end of the 2006-2007 winter season inches onto the horizon, we were interested in finding out how coal companies have been performing thus far. For his perspective on the industry, we turn to senior coal industry analyst Matthew Thurmond. The news has been choppy regarding coal lately. What are the main issues here? That’s a good question, Mark. Actually, the main issue has been the weather. A mild summer and a warmer-than-average winter [for the most part] have led to less power generation. Utility stockpiles have been building, and this reduces the near-term demand for coal. To compound this, higher overall prices prompted miners to increase 2006 production. Anytime demand for a commodity falls as supply goes up, pricing gets a little shaky. More. . .
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - How have your coal miners handled the oversupply thus far? They have been able to dodge near-term price volatility because they sign long-term contracts with utilities. The major coal miners I cover are Arch (ACI), Peabody (BTU) and Consol (CNX). They were all able to report fairly stable pricing during the fourth quarter. However, due to the recent over-supply, every one of them has decided to scale back 2007 production plans. Arch dropped its guidance from 140 million tons to just over 130 million, and Consol is refusing to increase production unless the market clearly demands it. Peabody, the world’s largest coal miner, is putting off its massive “School Creek” mine build-out until at least 2009. So overall, my coverage base is able to keep pricing and margins stable by curbing their production levels. Any tips for investors on how to profit from the coal sector going forward? I would say sit back and wait for better prices. If the economy turns sour and we happen to have a mild summer in the midst of it, it would probably be a good time to snap up a coal miner like Peabody. Right now, however, I only have one Buy rating on the six coal-focused companies in my coverage universe. This company, Natural Resource Partners (NRP), has fairly good dividend growth prospects and trades at a reasonable valuation. It is an MLP, however, and investors need to consider their tax situation before investing. As for the rest of my companies, the coal miners especially, I think they are fully priced. Companies like Arch and Peabody seem to be getting a premium for potential coal-to-liquids and coal gasification technology. While this could be a huge tailwind for the firms, I don’t see it being a serious contributor anytime soon. Further, coal mining is a tough, fairly low-return commodity business. Pricing is difficult to predict, it is capital intensive, and oversupply by marginal producers is a constant worry. So to sum it up, wait for better prices to snap up the country’s major coal miners. If you are looking for a 5-6% yield and agree that coal has a strong long-term outlook, consider Natural Resource Partners. Matthew Thurmond is a senior coal industry analyst for Zacks Equity Research. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Analyst Blog Real-time market insights from Zacks Equity Research Analysts. Matthew Thurmond is a senior coal industry analyst for Zacks Equity Research. To see their latest posts, click here. Chesapeake Energy (CHK) - Strong Growth Continues. For full Zacks research report, click here. Enzon Pharmaceuticals (ENZNM) - Sales Deterioration. For full Zacks research report, click here. Earnings Preview for the Week of Feb 19 – Feb 23 Positives Maintaining Big Lead 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. ZACKS WEALTH MANAGEMENT Every week, Zacks Wealth Management provides informative articles on how to build and protect wealth. Today’s topic is:
Not to be too philosophical, (especially since this is a financial forum) but what is the purpose of wealth? One thing I can say for certain, contrary to the Egyptians, we definitely will not be taking it with us beyond the grave. So let’s forget, at least for a moment, about “beating the market” and focus on the appropriate amount of risk you need to achieve your goals. To help you determine your optimal level of risk lets look at an example. Assume a household requires $150,000 a year to maintain their lifestyle over the next 30 years from a retirement age of 60. Assuming a rate of inflation of 4% (I believe because of rising health care costs, we should use a figure higher than CPI) and an after-tax return of 8%, they will need a total of just over $2.7 million at age 60. If that’s the case, they may have to take more or less risk to get to that point, depending on the total value of their assets before age 60. It is important to remember there are a few key variables that you control:
Keep in mind that historically equities as a broad asset class have returned approximately 10%. Investing in a no-risk savings account today will return about 4-5% and keep you slightly ahead of inflation. With these broad parameters in place, you are free to determine the appropriate amount of risk needed to fund your lifestyle through retirement. As you start to take distributions from your assets, you should seek to dampen the volatility so to avoid longevity risk. Clearly the examples we provided are rather basic, and a more in depth analysis will be needed for your individual situation. P.S. The answer to the initial question posed is…no more than needed to achieve your goals! Jonas Zamora is a Certified Financial Planner™ professional. To ask Fritz questions or to see a more real world scenario based upon individual criteria, please contact him at ffiebig@zacks.com. This article is provided for informational purposes only and does not constitute legal or tax advice. Zacks Investment Management, Inc. is not engaged in rendering legal, tax, accounting or other professional services. Publication and distribution of this article is not intended to create, and the information contained herein does not constitute, an attorney-client relationship. Do not act or rely upon the information and advice given in this publication without seeking the services of competent and professional legal, tax, or accounting counsel. CFP Board, a nonprofit regulatory organization, fosters professional standards in personal financial planning so that the public values, has access to and benefits from competent and ethical financial planning. CFP Board owns the certification marks CFP®, Certified Financial Planner™ and federally registered CFP (with flame logo), which it awards to individuals who successfully complete initial and ongoing certification requirements. CFP Board currently authorizes more than 50,000 individuals to use these marks in the United States. For more about CFP Board, visit www.CFP.net. Learn more about Zacks Wealth Management now! - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - MITCH ZACKS ON THE MARKETS The stock market should begin to benefit from flows of assets out of other investment classes. More... 5. FEATURED EXPERTS Here we cast the spotlight on a timely Featured Expert commentaries that recently appeared on Zacks.com. Jack Adamo details the recent gains experienced by some of his holdings and discusses his Income Portfolio. More... Donald Rowe says investors should focus on capturing profits from 2007-2010. Read his commentary and recommendations. More... Don Dion discusses recent market events and offers his opinion on what to expect. Read his commentary and mutual fund profile. More... 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 (Strong Sell) List has 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. Or view the full list of Zacks #1 Ranked stocks. 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, 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 Zacks Performance Rank performance is the total return of equal weighted simulated portfolios consisting of those stocks with the indicated Zacks Rank net of fees. Results reflect the reinvestment of dividends and other earnings. Simulated results do not represent actual trading and may not reflect the impact that economic and market factors might have had on decision-making if an adviser were actually managing a client's money. 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 06/18/2013
| Company Name | Symbol | %Change |
|---|---|---|
| STAAR SURGIC | STAA | 10.98% |
| LUMOS NETWOR | LMOS | 5.70% |
| INSTEEL IND | IIIN | 5.28% |
| ERICKSON AIR | EAC | 5.10% |
| ASSURED GUAR | AGO | 4.98% |
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