Sponsored Links 
Zacks Analyst Blog Highlights: Dell, Hewlett-Packard, Overseas Shipholding Group, Frontline and Teekay
Print
ShareFor Immediate Release
Chicago, IL – March 15, 2011 – Zacks.com Analyst Blog features: Dell Inc. (DELL - Analyst Report), Hewlett-Packard Company (HPQ - Analyst Report), Overseas Shipholding Group Inc. (OSG - Analyst Report), Frontline Ltd. (FRO - Snapshot Report) and Teekay Corp. (TK - Snapshot Report).
Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=4579
Here are highlights from Monday’s Analyst Blog:
Dell on the Move
Computing major Dell Inc. (DELL - Analyst Report) is continuing on its deal winning spree. Recently, the company announced a two-year extension with The Massachusetts Health Connector Authority (Health Connector). Per the agreement, the technology major will provide solutions for a range of enrollment, billing, website and customer experience services.
The deal focuses on services that Massachusetts Health will provide through “Commonwealth Care,” a low-cost health insurance option. Dell is currently applying its technical know-how and best practices to other state government organizations that the company has developed in association with Health Connector.
Dell also provides maintenance services for the company’s portals, which meet specific healthcare needs of individuals. Although this is a renewal agreement, Dell did not disclose the financial details.
Dell also clinched another six-year information technology outsourcing deal with TUI Travel plc, a company under TUI AG, a renowned European travel group. As usual, Dell did not comment on the financial impact, but said that it would provide hardware and software asset management, as well as help desk, printer management, patch management, deployment, software compliance, and other services in the UK, Germany, France, Spain, the Netherlands and Switzerland.
Apart from winning meaningful deals at regular intervals, the company continues to benefit from the enterprise PC upgrade cycle, server upgrades and server virtualization. Although Hewlett-Packard Company (HPQ - Analyst Report) is the market leader in the PC segment, of late, Dell has been seeing market share gains in the developing world. This is expected to catalyze its business growth over the long term and result in more deal wins from the region.
Moody’s Downgrades OSG
Overseas Shipholding Group Inc. (OSG - Analyst Report), a leading energy products transportation company, recently suffered a setback as Moody’s Investor Service downgraded its credit ratings. Primary reason for this downgrade is the continuously falling oil tanker rates attributable to significant increase in supply of tankers.
Moody’s downgraded the corporate family and default ratings of Overseas Shipholding to “B1” from “Ba2.” At the same time, the rating agency also lowered the senior unsecured debt to “B2” from “Ba3.”
Overseas Shipholding reported mounting losses in the fourth quarter of 2010. The company has a massive 70% spot exposure. The average spot rate of oil tanker fell 55% in the last quarter, which significantly eroded the company’s bottom line.
Overseas Shipholding Group Inc. (OSG - Analyst Report), a leading energy products transportation company, recently suffered a setback as Moody’s Investor Service downgraded its credit ratings. Primary reason for this downgrade is the continuously falling oil tanker rates attributable to significant increase in supply of tankers.
Moody’s downgraded the corporate family and default ratings of Overseas Shipholding to “B1” from “Ba2.” At the same time, the rating agency also lowered the senior unsecured debt to “B2” from “Ba3.”
Overseas Shipholding reported mounting losses in the fourth quarter of 2010. The company has a massive 70% spot exposure. The average spot rate of oil tanker fell 55% in the last quarter, which significantly eroded the company’s bottom line.
The oil tanker industry is highly competitive and fragmented. Overseas Shipholding competes with large U.S. and international flag tankers. Its major competitors include Frontline Ltd. (FRO - Snapshot Report) and Teekay Corp. (TK - Snapshot Report).
Also, spot freight rates are extremely volatile. Fuel is the largest expense in shipping operations when vessels are under spot charter and increase in fuel prices may hurt profitability.
Also, spot freight rates are extremely volatile. Fuel is the largest expense in shipping operations when vessels are under spot charter and increase in fuel prices may hurt profitability.
Nevertheless, Overseas Shipholding maintains a state-of-the-art fleet of vessels with major emphasis on quality, safety, and environmental issues.In late 2010, Overseas Shipholding completed an organizational restructuring.
Management decided to focus on three core areas: crude oil, international products, and U.S. Flag. The company shifted its standalone LNG carrier management business to its International Product Carrier and Gas Strategic business unit.
As a result of global economic improvement, we believe fundamentals of the oil tanker industry remain compelling. Recent political turmoil in the Arab countries may also raise demand for oil tankers at least for the short term.
Importantly, in the previous quarter, the U.S. Flag business rose 12% year over year. The company now expects this segment to contribute positively in 2011 compared with an operating loss of $35 million in 2010.
We maintain our long-term Neutral recommendation on Overseas Shipholdong. Currently, it holds a short-term Zacks #3 Rank (Hold) on the stock.
Want more from Zacks Equity Research? Subscribe to the free Profit from the Pros newsletter: http://at.zacks.com/?id=5514.
Management decided to focus on three core areas: crude oil, international products, and U.S. Flag. The company shifted its standalone LNG carrier management business to its International Product Carrier and Gas Strategic business unit.
As a result of global economic improvement, we believe fundamentals of the oil tanker industry remain compelling. Recent political turmoil in the Arab countries may also raise demand for oil tankers at least for the short term.
Importantly, in the previous quarter, the U.S. Flag business rose 12% year over year. The company now expects this segment to contribute positively in 2011 compared with an operating loss of $35 million in 2010.
We maintain our long-term Neutral recommendation on Overseas Shipholdong. Currently, it holds a short-term Zacks #3 Rank (Hold) on the stock.
Want more from Zacks Equity Research? Subscribe to the free Profit from the Pros newsletter: http://at.zacks.com/?id=5514.
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=5516
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=4580.
Follow us on Twitter: http://twitter.com/ZacksResearch
Join us on Facebook: http://www.facebook.com/ZacksInvestmentResearch
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 DELL
Read the full analyst report on HPQ
Read the full analyst report on OSG
Read the full analyst report on FRO
Read the full analyst report on TK
Loading Stories...
-74.92