Zacks Bull and Bear of the Day Highlights: ENSCO, Overseas Shipholding Group, Inc., T.J. Maxx, Saks and Colgate-Palmolive.

For Immediate Release

Chicago, IL – May 22, 2009 – Zacks Equity Research highlights ENSCO (ESV - Analyst Report) as the Bull of the Day and Overseas Shipholding Group, Inc. (OSG - Analyst Report) the Bear of the Day. In addition, Zacks Equity Research provides analysis on T.J. Maxx (TJX - Snapshot Report), Saks (SKS - Analyst Report) and Colgate-Palmolive (CL - Analyst Report).

Full analysis of all these stocks is available at http://at.zacks.com/?id=2676.

Here is a synopsis of all five stocks:

Bull of the Day:

The recent strength in crude oil prices has improved the outlook for a cyclical recovery. Historically, jackup drillers like ENSCO (ESV - Analyst Report) have enjoyed strong early-cycle leverage, a trend that we believe will play out this time as well.

While the near-term situation is expected to remain weak, with rig oversupply and soft demand weighing on dayrates, the medium to long-term outlook remains favorable. ENSCO enjoys strong leverage to this outlook given its fleet of premium jackup rigs, an exceptionally strong balance sheet, and growing deepwater exposure.

Our new $45 price objective, raised from $40 before, results from 2009 P/E and EV/EBITDA multiples of 7.4x and 4.3x, respectively, both well within historical trading ranges.

Bear of the Day:

We are maintaining our Sell recommendation on Overseas Shipholding Group, Inc. (OSG - Analyst Report), and raising our target price to $30. OSG reported first quarter diluted EPS before nonrecurring items of $1.03, above the $1.00 consensus, but below our $1.06 estimate as revenues came in weaker than expected from lower spot tanker rates, partly offset by increased revenue days.

We are slashing our 2009 diluted EPS estimate to a loss of $0.45 per share from earnings of $2.10 per share, as we now believe the impact of the global economic slowdown will be more pronounced than previously expected. We have cut our 2009 revenue assumptions due to reduced estimates for spot market rates (roughly 45% of the company s fleet is exposed to the spot market) and fewer revenue days.

Our initial estimate for 2010 is a $0.05 loss per share. While OSG recently increased its dividend by 40%, we cannot rule out a dividend cut in the event of a protracted economic downturn.

Latest Posts on the Zacks Analyst Blog:

Initial Claims – No Clear Signal

The current level of initial unemployment claims is about what we saw in February. In February, the economy lost 681,000 jobs, and in March it lost 699,000. It is hard for me to see how with the current level of claims we will not lose less than 600,000 jobs. Depending on how many people become "discouraged" and leave the work force (or become encouraged and restart their job search) this would probably mean that the unemployment rate (U3) will rise to about 9.3% in May. That would exceed the low end of the Fed’s central tendency for unemployment in the fourth quarter (range 9.2% to 9.6%).

The rise in unemployment will keep pressuring consumer spending downward. If you have to invest in retail, go with the discounters. Think T.J. Maxx (TJX - Snapshot Report), not Saks (SKS - Analyst Report), as people will continue to pinch their pennies.

Even though they have lagged in the big bounce since early March, I continue to favor large, strong companies with bullet-proof balance sheets and which make products that people need, rather than just want -- things that they will buy regardless of how the economy is doing. One name that comes to mind that fits that description is Colgate-Palmolive (CL - Analyst Report).

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About the Bull and Bear of the Day

Every day, the analysts at Zacks Equity Research select two stocks that are likely to outperform (Bull) or underperform (Bear) the markets over the next 3-6 months.

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