Zacks Analyst Blog Highlights: McDonald Corporation, Yum! Brands, Johnson Controls, Deckers Outdoor Corporation and Skechers USA

For Immediate Release

Chicago, IL – July 26, 2010 – Zacks.com Analyst Blog features: McDonald Corporation (MCD - Analyst Report), Yum! Brands, Inc. (YUM - Analyst Report), Johnson Controls Inc. (JCI - Analyst Report), Deckers Outdoor Corporation (DECK - Analyst Report) and Skechers USA Inc. (SKX).

Here are highlights from Friday’s Analyst Blog:

McDonald’s Beats by a Penny

McDonald Corporation (MCD - Analyst Report) posted second-quarter 2010 earnings of $1.13 per share ,beating the Zacks Consensus Estimate by a penny. The second quarter earnings surged 15% from 98 cents reported in the prior-year quarter.

The better-than-expected results were driven by value offerings and premium products, and a rise in comparable-store sales across all regions.

McDonald’s, the world's largest hamburger chain, said that revenue for the quarter climbed 5% to $6.0 billion, outperforming the Zacks Consensus Estimate of $5.9 billion.

Revenues from company-operated restaurants rose 4% to $4.0 billion, while revenues from franchise-operated restaurants jumped 8% to $1.9 billion. Total operating income soared 10% to $1.8 billion.

McDonald’s global comparable-store sales continue to grow, while maintaining healthy margins on an expanding market share. Global comparable-store sales rose 4.8% during the quarter with the U.S. sales up 3.7%, Europe up 5.2% and Asia/Pacific, Middle East and Africa (APMEA) up 4.6%.

The new menu offerings -- including value-based drinks, frappes and McCafe premium coffee line-up, along with the breakfast dollar menu -- have perked up U.S. comps and operating income (up 7%).

In Europe, the U.K., France and Russia led the operating income growth of 9%. The premium product innovation, marketing promotion and restaurant re-imaging program continued to drive market share gains. In APMEA, operating income jumped 19% led by Australia and China.

During the quarter, MCDonald’s returned shareholders $1.6 billion through share repurchases and dividend.

One of McDonald’s primary competitors, Yum! Brands, Inc. (YUM - Analyst Report) reported its second quarter 2010 earnings of 58 cents per share on July 13, which surpassed the Zacks Consensus Estimate of 54 cents. The earnings increased 17% year over year, mainly on the back of strong performances in its China division.

Johnson Controls Barely Misses

Johnson Controls Inc. (JCI - Analyst Report) showed a profit that more than doubled to $367 million or 54 cents per share in the third quarter of its fiscal 2010 ended June 30, 2010 from $154 million or 25 cents per share in the year-ago quarter (all excluding non-recurring items). But the company just missed the Zacks Consensus Estimate by 1 cent per share.

The improvement in earnings was attributable to higher sales in each of its segments, driven by a recovery in the global markets. Net sales in the quarter rose 22% to $8.54 billion, exactly meeting the Zacks Consensus Estimate.

Johnson Controls reiterated its sales guidance for the full fiscal year 2010. The company expects an 18% rise in net sales to $33.5 billion for the fiscal year. However, it updated the earnings guidance for full fiscal year 2010. The company now expects to earn profits in the upper limit of its previous guidance of between $1.90 and $1.95 per share.

While announcing the previous quarter results, the company raised its forecasts for North American and European automotive production to 10.9 million units and 16.7 million units, respectively, for the full fiscal year. The company now believes the positive impact from these higher production estimates will be partially offset by the negative impact of the depreciating Euro.

Deckers Beats Zacks Estimate

Deckers Outdoor Corporation (DECK - Analyst Report), the maker of sheepskin boots and slippers, recently delivered better-than-expected second quarter results on the heels of strong demand for the product lines under the UGG and Teva brands.

The quarterly earnings of 23 cents a share outpaced the Zacks Consensus Estimate of 10 cents, and rose more than twofold from 9 cents which was posted in the prior-year quarter.

Deckers breezed past the Zacks Consensus Estimate by 130%. The company’s earnings surprise history compared to the Zacks Consensus Estimate for the preceding four quarters, varies between 16.2% and 400% with the average being 122.6%.

Deckers, which compete with Skechers USA Inc. (SKX), said that total net sales jumped to $137.1 million, up 33.7% from the prior-year quarter, comfortably surpassing the Zacks Consensus Revenue Estimate of $127 million. The company’s sustained focus on new product introductions and geographic expansion has helped achieve a robust growth.

Domestic sales for the quarter rose from 16.2% to $65.2 million, whereas international sales soared from 54.8% to $71.8 million. International sales now represent 52.4% of total sales up from 45.3% in the year-ago quarter.

The international markets provide a significant growth opportunity, and we remain optimistic about the company’s incremental sales and earnings potential. Internationally, the company distributes its products throughout Europe, Asia Pacific, Canada, and Latin America. Management targets to generate 30% of the total annual sales, internationally, by 2012.

Want more from Zacks Equity Research? Subscribe to the free Profit from the Pros newsletter: http://at.zacks.com/?id=5515.

About Zacks Equity Research

Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today: http://at.zacks.com/?id=5517.

About Zacks

Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leonard Zacks. As a PhD in mathematics Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at http://at.zacks.com/?id=5518.

Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.

Follow us on Twitter: http://twitter.com/zacksresearch

Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts.

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.

Contact:
Mark Vickery
Web Content Editor
312-265-9380
Visit: www.zacks.com

Read the full analyst report on MCD

Read the full analyst report on YUM

Read the full analyst report on JCI

Read the full analyst report on DECK

Read the full analyst report on SKX