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BlackRock, Pier One Imports, Alkermes, Vertex Pharmaceuticals and Agenus highlighted as Zacks Bull and Bear of the Day
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For Immediate Release
Chicago, IL – Jan 17, 2018 – Zacks Equity Research highlights BlackRock (BLK - Free Report) as the Bull of the Day, Pier One Imports as the Bear of the Day. In addition, Zacks Equity Research provides analysis onAlkermes plc( (ALKS - Free Report) , Vertex Pharmaceuticals Inc. (VRTX - Free Report) and Agenus Inc. (AGEN - Free Report) .
Headquartered in New York, BlackRock is the world’s largest asset manager, with more than $6 trillion in AUM.
They have a comprehensive range of products and services across asset classes, geographies and investment strategies and in a variety of structures that include separate accounts, mutual funds, iShares (ETFs) and other pooled investment vehicles.
Excellent Q4 Results
The company reported excellent results for Q4 and FY 2017, beating on both the top and bottom lines. Adjusted earnings for the quarter came in at $6.24 per share, ahead of the Zacks Consensus Estimate of $6.08 and up 21% year-over-year.
Revenues (GAAP basis) came in at $3.47 billion, up 20% year over year and ahead of the Zacks Consensus Estimate of $3.35 billion.
Founded in 1962 and headquartered in Fort Worth, Texas, Pier One Imports is a retailer of home furnishings and decorations. Their products include decorative home furnishings, dining, kitchen goods, bath, bedding accessories, and specialty items.
Shares Plunge After Weak Results
The retailer reported weak results for its third quarter ended November 25, 2017. Net sales decreased 1.4% to $469.2 million while comparable sales decreased 0.7%. Hurricanes in Texas and Florida also impacted results.
Earnings per share of $0.09 fell significantly short of the Zacks Consensus Estimate of $0.12. The stock plunged about 30% after the report.
“Our third quarter financial performance was impacted by the hurricanes in Texas and Florida, as well as deeper than expected promotional activity in October and November We saw improved sales in November, including a solid Black Friday weekend, driven by our strong promotional message. However, overall trends dropped considerably during the first two weeks of December,” said the CEO.
The management reduced its full year adjusted earnings per share (non-GAAP) guidance to $0.17 --$0.25 versus prior guidance of $0.38 -- $0.48, “reflecting the current tone and volatility of the business in the first two weeks of December.”
Falling Estimates
Analysts have slashed their estimates for the company after weak results and guidance. Zacks Consensus Estimates for the current and next fiscal year have fallen to $0.24 per share and $0.23 per share from $0.43 and $0.44 respectively, before the results.
Bottom Line
The stock has fallen to a Zacks Rank #5 (Strong Sell) after weak results. While some of their initiatives in the areas of cost cutting and boosting online sales were effective in the recent past, weak holiday sales have made the outlook cloudy.
The stock lost more than 50% of its value during 2017 but a rebound does not appear likely in view of sliding estimates. Investors should avoid the stock for the time being.
Additional Content:
3 Biotech Stocks Starting Healthy in 2018
In 2018, the biotech industry is expected to witness a continuation of last year’s favorable trends. Last year, the industry benefited from a number of FDA approvals, new product sales ramp up, R&D success and innovation, strong clinical study results and continued strength in some legacy products. There were some first-time approvals for innovative/game-changing treatment options.
Noteworthy among them was the approval of Novartis’ Kymriah, the first cell-based gene therapy known as CAR-T therapy, which is an innovative treatment option for cancer. This was followed by another CAR-T approval, that of Kite Pharma’s Yescarta. Spark Therapeutics’ Luxturna, the first gene therapy to treat a rare, inherited form of childhood blindness, was also approved last year.
The NASDAQ Biotechnology Index gained 17.8% in 2017. Moreover, the Medical - Biomed/Genetics industry increased 2.8% in the same time frame.
Though pricing pressure, rising competition, pipeline setbacks, slowdown in growth of mature products and generic competition for certain key drugs are some of the headwinds, the above-mentioned factors should continue contributing to the sector’s growth in 2018.
In December, the tax overhaul was signed into law, slashing corporate tax rates from 35% to 21% which can boost profits of large drug/biotech companies. Meanwhile, the change in tax code will also allow companies to bring back huge cash held overseas at a one-time tax rate of 10%.
Also, the tax cuts are expected to prevent inversions, which were rampant in the drug industry. These changes should definitely leave more cash in the hands of drug/biotech companies. The cash can be invested for mergers/acquisitions, which have been few in 2017.
With this bullish outlook for the sector, we look at three biotech stocks that have seen their share price rise more than 5% this year so far and look well positioned for the rest of 2018. All the three stocks have witnessed upward estimate revisions and have a favorable Zacks Rank - Zacks Rank #1 (Strong Buy) or #2 (Buy).
Alkermes plc: Alkermes is focused on the development and marketing of treatments for central nervous system ("CNS") diseases. Year 2018 is expected to be a transformative year for Alkermes’ development pipeline.
Key events lined up for the year include FDA’s review of ALKS 546’s new drug application (NDA) for the treatment of major depressive disorder, the phase III data readout for ALKS 3831 in schizophrenia, the NDA filing for ALKS 8700 in the first half of 2018, which is being evaluated for the treatment of multiple sclerosis. The company could also gain FDA approval for new initiation product of Aristada (Aripiprazole Lauroxil NanoCrystal Dispersion) for the treatment of schizophrenia by Jun 30.
Alkermes, a Zacks Rank #2 stock, has seen its shares gain 7.3% year to date compared with the 2.4% rally of the industry it belongs to. You can see the complete list of today’s Zacks #1 Rank stocks here. The company has seen the Zacks Consensus Estimate for 2018 earnings being revised 50% upward over the last 30 days.
Vertex Pharmaceuticals Inc.: Vertex sports a Zacks Rank #1. Its earnings per share estimates for 2018 have moved up 2.8% in the last 30 days. The company delivered a positive earnings surprise in each of the last four quarters, with an average beat of 32.67%. Share price of the company has increased 5.4% year to date.
Year 2017 was a tremendous year for Vertex with positive data read-outs and regulatory approvals leading to an increase in eligible patient population for its two cystic fibrosis (CF) products - Kalydeco & Orkambi. The trend continues in 2018 with Orkambi getting EU approval for pediatric use.
With a consistent expansion in patient population, Vertex’s CF product revenues increased through 2017. The company is optimistic that the positive trend in CF sales will continue in 2018 on additional reimbursement approvals for Orkambi in ex-U.S. markets and approval to launch tezacaftor (VX-661)/ivacaftor combination medicine.
Vertex’s CF pipeline is also quite strong with a broad portfolio of next-generation CF correctors. Vertex also made decent clinical progress across multiple CF studies in 2017 and has meaningful pipeline catalysts. Investor focus is on triple combination CF regimens, which are crucial for long-term growth as these have the potential to treat up to 90% of CF patients. Vertex plans to initiatepivotal phase III studies on up to two of the four triple combination regimens in the first half of 2018.
Agenus Inc.: Agenuscarries a Zacks Rank #2. Loss estimates for the company narrowed by 0.7% for 2018 in the last 30 days. Share price of the company has increased 18.7% year to date.
Agenus has formed collaborations with Merck and Incyte to discover and develop multiple checkpoint antibodies.
In October 2017, the FDA granted marketing authorization to GlaxoSmithKline's herpes zoster vaccine, Shingrix, which contains Agenus' proprietary immune adjuvant QS-21 Stimulon. This is good news for Agenus as Shingrix has a blockbuster potential and an increase in its sales will impact the business of Agenus positively
Earlier this month, the company announced a $230 million non-dilutive royalty financing transaction with HealthCare Royalty Partners (HCR) which will significantly boost its cash position. Agenus will use part of these proceeds to redeem its royalty bond from Oberland and to fund its pivotal pipeline programs. The company also announced new leadership appointments to enhance its team and advance ongoing pivotal programs with CTLA-4 and PD-1 which will support its planned BLA filings in the second half of 2019 and in 2020.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
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.
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 analyst 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.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year. See these high-potential stocks free >>.
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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BlackRock, Pier One Imports, Alkermes, Vertex Pharmaceuticals and Agenus highlighted as Zacks Bull and Bear of the Day
For Immediate Release
Chicago, IL – Jan 17, 2018 – Zacks Equity Research highlights BlackRock (BLK - Free Report) as the Bull of the Day, Pier One Imports as the Bear of the Day. In addition, Zacks Equity Research provides analysis onAlkermes plc( (ALKS - Free Report) , Vertex Pharmaceuticals Inc. (VRTX - Free Report) and Agenus Inc. (AGEN - Free Report) .
Here is a synopsis of all five stocks:
Bull of the Day:
Headquartered in New York, BlackRock is the world’s largest asset manager, with more than $6 trillion in AUM.
They have a comprehensive range of products and services across asset classes, geographies and investment strategies and in a variety of structures that include separate accounts, mutual funds, iShares (ETFs) and other pooled investment vehicles.
Excellent Q4 Results
The company reported excellent results for Q4 and FY 2017, beating on both the top and bottom lines. Adjusted earnings for the quarter came in at $6.24 per share, ahead of the Zacks Consensus Estimate of $6.08 and up 21% year-over-year.
Revenues (GAAP basis) came in at $3.47 billion, up 20% year over year and ahead of the Zacks Consensus Estimate of $3.35 billion.
Bear of the Day:
Founded in 1962 and headquartered in Fort Worth, Texas, Pier One Imports is a retailer of home furnishings and decorations. Their products include decorative home furnishings, dining, kitchen goods, bath, bedding accessories, and specialty items.
Shares Plunge After Weak Results
The retailer reported weak results for its third quarter ended November 25, 2017. Net sales decreased 1.4% to $469.2 million while comparable sales decreased 0.7%. Hurricanes in Texas and Florida also impacted results.
Earnings per share of $0.09 fell significantly short of the Zacks Consensus Estimate of $0.12. The stock plunged about 30% after the report.
“Our third quarter financial performance was impacted by the hurricanes in Texas and Florida, as well as deeper than expected promotional activity in October and November We saw improved sales in November, including a solid Black Friday weekend, driven by our strong promotional message. However, overall trends dropped considerably during the first two weeks of December,” said the CEO.
The management reduced its full year adjusted earnings per share (non-GAAP) guidance to $0.17 --$0.25 versus prior guidance of $0.38 -- $0.48, “reflecting the current tone and volatility of the business in the first two weeks of December.”
Falling Estimates
Analysts have slashed their estimates for the company after weak results and guidance. Zacks Consensus Estimates for the current and next fiscal year have fallen to $0.24 per share and $0.23 per share from $0.43 and $0.44 respectively, before the results.
Bottom Line
The stock has fallen to a Zacks Rank #5 (Strong Sell) after weak results. While some of their initiatives in the areas of cost cutting and boosting online sales were effective in the recent past, weak holiday sales have made the outlook cloudy.
The stock lost more than 50% of its value during 2017 but a rebound does not appear likely in view of sliding estimates. Investors should avoid the stock for the time being.
Additional Content:
3 Biotech Stocks Starting Healthy in 2018
In 2018, the biotech industry is expected to witness a continuation of last year’s favorable trends. Last year, the industry benefited from a number of FDA approvals, new product sales ramp up, R&D success and innovation, strong clinical study results and continued strength in some legacy products. There were some first-time approvals for innovative/game-changing treatment options.
Noteworthy among them was the approval of Novartis’ Kymriah, the first cell-based gene therapy known as CAR-T therapy, which is an innovative treatment option for cancer. This was followed by another CAR-T approval, that of Kite Pharma’s Yescarta. Spark Therapeutics’ Luxturna, the first gene therapy to treat a rare, inherited form of childhood blindness, was also approved last year.
The NASDAQ Biotechnology Index gained 17.8% in 2017. Moreover, the Medical - Biomed/Genetics industry increased 2.8% in the same time frame.
Though pricing pressure, rising competition, pipeline setbacks, slowdown in growth of mature products and generic competition for certain key drugs are some of the headwinds, the above-mentioned factors should continue contributing to the sector’s growth in 2018.
In December, the tax overhaul was signed into law, slashing corporate tax rates from 35% to 21% which can boost profits of large drug/biotech companies. Meanwhile, the change in tax code will also allow companies to bring back huge cash held overseas at a one-time tax rate of 10%.
Also, the tax cuts are expected to prevent inversions, which were rampant in the drug industry. These changes should definitely leave more cash in the hands of drug/biotech companies. The cash can be invested for mergers/acquisitions, which have been few in 2017.
With this bullish outlook for the sector, we look at three biotech stocks that have seen their share price rise more than 5% this year so far and look well positioned for the rest of 2018. All the three stocks have witnessed upward estimate revisions and have a favorable Zacks Rank - Zacks Rank #1 (Strong Buy) or #2 (Buy).
Alkermes plc: Alkermes is focused on the development and marketing of treatments for central nervous system ("CNS") diseases. Year 2018 is expected to be a transformative year for Alkermes’ development pipeline.
Key events lined up for the year include FDA’s review of ALKS 546’s new drug application (NDA) for the treatment of major depressive disorder, the phase III data readout for ALKS 3831 in schizophrenia, the NDA filing for ALKS 8700 in the first half of 2018, which is being evaluated for the treatment of multiple sclerosis. The company could also gain FDA approval for new initiation product of Aristada (Aripiprazole Lauroxil NanoCrystal Dispersion) for the treatment of schizophrenia by Jun 30.
Alkermes, a Zacks Rank #2 stock, has seen its shares gain 7.3% year to date compared with the 2.4% rally of the industry it belongs to. You can see the complete list of today’s Zacks #1 Rank stocks here. The company has seen the Zacks Consensus Estimate for 2018 earnings being revised 50% upward over the last 30 days.
Vertex Pharmaceuticals Inc.: Vertex sports a Zacks Rank #1. Its earnings per share estimates for 2018 have moved up 2.8% in the last 30 days. The company delivered a positive earnings surprise in each of the last four quarters, with an average beat of 32.67%. Share price of the company has increased 5.4% year to date.
Year 2017 was a tremendous year for Vertex with positive data read-outs and regulatory approvals leading to an increase in eligible patient population for its two cystic fibrosis (CF) products - Kalydeco & Orkambi. The trend continues in 2018 with Orkambi getting EU approval for pediatric use.
With a consistent expansion in patient population, Vertex’s CF product revenues increased through 2017. The company is optimistic that the positive trend in CF sales will continue in 2018 on additional reimbursement approvals for Orkambi in ex-U.S. markets and approval to launch tezacaftor (VX-661)/ivacaftor combination medicine.
Vertex’s CF pipeline is also quite strong with a broad portfolio of next-generation CF correctors. Vertex also made decent clinical progress across multiple CF studies in 2017 and has meaningful pipeline catalysts. Investor focus is on triple combination CF regimens, which are crucial for long-term growth as these have the potential to treat up to 90% of CF patients. Vertex plans to initiatepivotal phase III studies on up to two of the four triple combination regimens in the first half of 2018.
Agenus Inc.: Agenuscarries a Zacks Rank #2. Loss estimates for the company narrowed by 0.7% for 2018 in the last 30 days. Share price of the company has increased 18.7% year to date.
Agenus has formed collaborations with Merck and Incyte to discover and develop multiple checkpoint antibodies.
In October 2017, the FDA granted marketing authorization to GlaxoSmithKline's herpes zoster vaccine, Shingrix, which contains Agenus' proprietary immune adjuvant QS-21 Stimulon. This is good news for Agenus as Shingrix has a blockbuster potential and an increase in its sales will impact the business of Agenus positively
Earlier this month, the company announced a $230 million non-dilutive royalty financing transaction with HealthCare Royalty Partners (HCR) which will significantly boost its cash position. Agenus will use part of these proceeds to redeem its royalty bond from Oberland and to fund its pivotal pipeline programs. The company also announced new leadership appointments to enhance its team and advance ongoing pivotal programs with CTLA-4 and PD-1 which will support its planned BLA filings in the second half of 2019 and in 2020.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>
Get today’s Zacks #1 Stock of the Day with your free subscription to Profit from the Pros newsletter:
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.
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 analyst 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.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year. See these high-potential stocks free >>.
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Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.