Friday - March 30, 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 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 – Titanium Metals Corporation (TIE) Titanium Metals Corporation (TIE) is enjoying strong demand for its products and is focused on investment in expansion of its productive capacity. The stock is only covered by one analyst, but earnings estimates have jumped. Over the past 60 days, this year's estimates have risen 13 cents to $1.65 per share. The stock is attractive at 17.9x next year's estimates, below its projected growth rate of 25%. Read the full analysis on TIE now! PartnerRe, Ltd. (PRE) exceeded analysts’ earnings expectations in 11 out of the past 12 quarters by an average margin of 23.0%. Consensus estimates for both this year and next are up over the past two months. On Jan 25, the Board of Directors announced an increase in the company’s annual dividend by 7.5% to $1.72 per common share. PRE has a current dividend yield of 2.5% and a five-year average dividend yield of 2.3%. Read the full analysis on PRE now! Sotheby’s Holdings Inc. (BID) recently reported record quarterly and full-year profits. The company detailed plans to enhance its website, refocus on major clients and expand its international presence. Though trading at 52-week highs, Sotheby’s should continue its upward trend. Read the full analysis on BID now! Diana Shipping, Inc. (DSX) exceeded analysts’ earnings expectations for four straight quarters by an average margin of 36.6%. The Board of Directors recently increased the company’s quarterly cash dividend by 100% to 6.25 cents per common share. This Zacks #1 Rank stock has a price-to-book ratio of only 1.3, compared to 4.2 for the market. Read the full analysis on DSX 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 Track: Upgrades and Revisions 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. Here are four stocks that make the grade for the Upgrades and Revisions Profit Track: Astec Industries Inc. (ASTE) recently reported fourth-quarter earnings of 29 cents per share, surging past last year’s five cents and exceeding the consensus estimate by 21%. ASTE stated that with a record backlog, good economy, highway funding legislation in place, its efficiency initiatives and a strong balance sheet, it is excited about what can be accomplished in growing the business in both revenues and profits in 2007. The company experienced earnings per share growth of 124% over the past five years. Continue your research on ASTE now! Biolase Technology Inc. (BLTI) has seen earnings per share growth of 265% over the past five years, the highest five-year track record currently listed under this Profit Track. BLTI recently delivered fourth-quarter earnings of four cents per share. The result blew away analysts’ estimates of a one-cent loss and soared past the previous year’s loss of five cents. The company mentioned that its quarterly performance was a solid finish to a fiscal year in which BLTI saw improvements throughout its business. Continue your research on BLTI now! Horace Mann Educators Corp. (HMN) put together a five-year growth track record of 23%. In early February, the company posted fourth-quarter earnings that were ahead of the year-prior quarter and beat the consensus estimate by 12%. HMN noted that it produced solid earnings for the fourth quarter and full year, and its growth initiatives continued to gain traction. Results for the first quarter will be available on May 3, 2005. Continue your research on HMN now! MetLife Inc. (MET) released fourth-quarter and full-year 2006 results in mid-February. Operating earnings available to common shareholders for the fourth quarter totaled $1.36 per share. The result topped last year’s $1.04 and beat the consensus estimate by 15.25%. As one of its highlights, MET noted that it achieved record operating earnings available to common shareholders in Institutional Business, Individual Business and Auto & Home segments. During the past five years, MET produced earnings per share growth of 29%. Continue your research on MET now! To see the full list of stocks that currently pass 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. Learn more about the Research Wizard free trial offer and our new special report “Top 10 Stock Screening Strategies”. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Kevin Matras explains why using a backtested trading strategy is the only way to go. More... 3. ZACKS EQUITY RESEARCH Bullish in the short-term on some of the bigger markets in Latin America—particularly Brazil—Zacks senior analyst Claudio Freitas, CFA explains to us why and where he sees emerging strengths in the region. Do you see the troubles in the U.S. housing market contributing to Latin American market declines? It is definitely a risk to be considered. Even though the troubles in the U.S. housing market are a domestic matter, it is beyond any doubt that the continued increase in housing prices played an important role in the continued expansion of the U.S. consumption. Thus any problems in this area could trigger a reverse effect that will certainly reduce international commodity prices, including some goods that are exported by many Latin countries, like oil, steel, iron, pulp, agricultural products, etc. More. . .
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Until recently, commodity prices were fueled up by continued Asian demand, particularly from China. The million dollar question now is if the Chinese economic growth will be able to sustain the high prices of commodities even if U.S. falls into a recession. In my opinion, the U.S. demand is still important, however the economic growth in Asia will remain on track regardless of the U.S. situation. Thus the crisis hypothesis is unlikely, though some corrections/volatility might occur. Brazilian economic growth recently has been disappointing, but the performance of the stock market has been quite positive. Is it reasonable to expect that better economic performance in the following years will further fuel the stock market there? It is true that Brazilian economic growth has been disappointing. In the last four years, the average annual economic growth in Brazil was just 3.4%, well below other emerging economies like China and India. For the near future, there are some reasons for hope. Brazilian domestic interest rates began to fall in September 2005; they went from more than 19% per year to 11.75% now, and there is room for continued cuts throughout 2007. In the medium term we believe Brazilian interest rates will converge to international standards. Some weeks ago, the Brazilian government announced an ambitious four year, US$235 billion infrastructure investment plan, the so-called PAC, in order to increase economic growth to somewhere around 5% per year. I really do not believe the PAC will reach its target. Brazil needs some structural reforms—in pensions, tax and labor—but the current government doesn’t seem eager to implement a reform agenda. All considered, increased investments coupled with lower domestic interest rates will be strong enough to grant a growth in the 4% to 4.5% range in average in the following years—still below other emerging economies. However, it is important to note that the Brazilian stock market has a much lower valuation (around 11x P/E) compared to other emerging economies like India and China (around 20x P/E), thus the Brazilian market has a considerable upside in the short-term, mainly considering that the country should become investment-grade within two years. Read the complete ANALYST INTERVIEW article now. Claudio Freitas, CFA is a senior analyst covering the Latin American markets for Zacks Equity Research. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Analyst Blog Real-time market insights from Zacks Equity Research Analysts. Stocks featured recently include Xilinx (XLNX), Amylin Pharmaceuticals (AMLN), GameStop (GME) and AstraZeneca (AZN). To see their latest posts, click here. GameStop Corp. (GME) - Well Positioned. For full Zacks research report, click here. Amylin Pharmaceuticals (AMLN) - Overvalued. For full Zacks research report, click here. The Good and Bad Side of Higher Gas Prices Revisions Ratio for 2007 Drops to 0.80 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. INVESTMENT IDEAS The editors at Zacks.com constantly analyze the universe of stocks to find you great stocks. Today, learn how you can profit from Affluenza: Outlined below are four retail stocks that have been reaping the benefits of a strong global economy and Affluenza. These companies are showing off record profits and soaring stock prices and they don’t seem to be affected by high gas prices or rogue weather patterns. Coach Inc. (COH) Coach Inc. is a leading designer of leather handbags and accessories, for both women and men. The company has also expanded into fine jewelry, eyewear, outerwear, footwear and office furniture. In the company’s latest earnings report, EPS rose to 61 cents, three cents above expectations and 35.6% above year ago numbers. Driving the surprise was a 29% increase in revenues to $836.4 million. Strong results from the new Legacy Collection, which has price points 45% above the company’s other core offerings, was especially well received. International growth was encouraging as well, with sales in Japan rising 18%. Coach Inc.’s financial performance has been impressive. Since 2001, sales have increased at an average annual rate of 31%, well above the five-year industry average of 15%. The company’s 2006 ROE of 40% is twice the industry average. In addition, ROA has risen in each of the last five years and stands at 33% for 2006, stomping the industry average of 15%. Free cash flow has also seen consistent growth, comprising 22% of revenues in fiscal 2006, well above the industry average of 11.8%. The company’s profit margins follow a similar trend, with gross margins increasing in each of the last five years. Nordstrom (JWN) Nordstrom, Inc. is one of the nation's leading fashion specialty retailers, with stores located in a number of states, including full-line stores, Nordstrom Racks, Faconnable boutiques, and free-standing shoe stores. Nordstrom also operates Faconnable boutiques throughout Europe. On Feb 23, the company reported fourth quarter EPS of 89 cents, up 29% from last year, but one penny below expectations. The near miss was the first in over 15 consecutive quarters. However, quarterly revenues rose an impressive 15% to $2.6 billion, while same store sales grew 8.3%. In a big comeback, while Walmart (WMT) and Federated (FD) reported weak February same-store-sales due to cold weather and storms, Nordstrom bucked the trend and posted same store-sales-growth of 9.1%, beating analyst expectations of a 5.6% increase. The company also announced plans to improve its online operations and open new stores. Nordstrom currently operates 155 stores, of which only 98 are full line Nordstrom stores, allowing for plenty of growth opportunities, especially in the East and South regions. Of the stocks featured, JWN has the most compelling valuation. The stock is currently trading at 15.9x 2007 expected earnings, in line with respective market and industry multiples. EPS growth over the last five years has averaged 46%, well above the industry’s 16.9% growth. In addition, the company’s ROE of 34.9% and ROA of 14.2% are above the respective industry ratios. Read the full Investment Ideas article by clicking here. 5. FEATURED EXPERTS Here we cast the spotlight on timely Featured Expert commentaries that recently appeared on Zacks.com.
Dr. Melvin Pasternak, in his latest StreetAuthority Swing Trader newsletter, expects a very broad trading range in the S&P over the next several months. More...
Gregory Spear illustrates how jittery traders are regarding the Middle East. Read his commentary and learn about his energy holdings. More...
Mutual Fund expert Walter S. Frank discusses the erosion of S&P earnings estimates in his latest MONEYLETTER newsletter. 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 stocks (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 05/20/2013
| Company Name | Symbol | %Change |
|---|---|---|
| ORBOTECH LTD | ORBK | 10.86% |
| SONIC FOUNDR | SOFO | 9.45% |
| VIPSHOP HOLD | VIPS | 9.20% |
| RENEWABLE EN | REGI | 8.98% |
| EAGLE BULK S | EGLE | 7.84% |
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