For Immediate Release
Chicago, IL – March 7, 2012 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Loews Corporation ( (L - Analyst Report), Diamond Offshore ( (DO - Analyst Report), CNA Financial Corporation ( (CNA - Snapshot Report), Nokia Corp. ( (NOK - Analyst Report) and Microsoft Corp. ( (MSFT - Analyst Report).
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Here are highlights from Tuesday’s Analyst Blog:
Loews Corp. to Underperformed
We are downgrading Loews Corporation ( (L - Analyst Report) to Underperform from Neutral on the back of weak fourth quarter results. Operating earnings in the fourth quarter lagged the Zacks Consensus Estimate owing to lower investment income from the limited partnership, increase in insurance reserves for its payout annuity business, lower earnings at Diamond Offshore and weak equity investments.
Loews’ subsidiary – Diamond Offshore ( (DO - Analyst Report) – again posted lower earnings in the fourth quarter due to a higher number of planned downtime days for scheduled maintenance, survey, mobilization and upgrades. For 2012, Diamond Offshore estimates a year-over-year decline in contract drilling revenues due to downtime for rig mobilizations, regulatory surveys and shipyard projects.
Also, CNA Financial Corporation’s ( (CNA - Snapshot Report) exposure to catastrophe loss cost it $208 million, a substantial deterioration from $113 million in the year-ago quarter.
HighMount, the exploration and production business wing, generated weaker revenues and net income on lower sales volumes. The downside resulted from less drilling activity and low natural gas prices.
However, CNA’s property and casualty operation continues to deliver solid performance on the back of new business, continued rate improvement and higher retention. Besides, 2011 marked the fifth consecutive year of favorable prior-year property and casualty loss development. Also, CNA’s merger with CNA Surety, completed in June 2011, will help it to expand its Specialty franchise.
Loews maintains a strong balance sheet with minimal debt. It has aggressively bought back shares in the past. Loews spent $718 million in 2011 to buy back 18.2 million shares, with 0.8 million shares repurchased in the fourth quarter.
The quantitative Zacks #4 Rank (short-tem Sell rating) for the company indicates downward pressure on the shares over the near term.
Headquartered in New York, Loews Corporation is a diversified holding company. The company’s principal subsidiaries are CNA Financial Corporation, Diamond Offshore Drilling Inc., Boardwalk Pipeline Partners LP, Loews Hotels Holding Corporation and HighMount Exploration & Production LLC.
Nokia Suffers S&P Downgrade
Nokia Corp. ( (NOK - Analyst Report) has suffered a setback as Standard & Poor’s Ratings Services (S&P) downgraded its credit rating. Currently, S&P rates Nokia as BBB-, which is the lowest rank of the rating agency’s investment grade category. As per S&P, Nokia’s partnership with Microsoft Corp. ( (MSFT - Analyst Report) may help the company to strengthen its competitive position in the global smartphone market, but significant fall in demand for the company’s legacy Symbian-based handsets will more than offset the positives of Windows Phone based smartphones.
Quarterly net revenue in the fourth quarter of 2011 was approximately $13,496.7 million, down 21% year over year. Smartdevices (including smartphones and tablets) revenue was $3,705.7 million, down 38% year over year. Mobile Feature Phone revenue was $4,101 million, down 23% year over year. Smartdevices average selling price (ASP) was $188.9, down 9% year over year. Mobile Feature Phone ASP was $43.2, down 24% year over year. In the fourth quarter of 2011, Nokia shipped 19.6 million smartdevices and 93.9 million Mobile Feature Phones, down 31% and 1% year over year, respectively.
Despite fairly good market traction for its Lumia series of Windows Phone-based smartphones, Nokia’s top line fell primarily due to poor performance of its Symbian-based handsets compared with low-cost handsets from Samsung, LG, and HTC in the Asian markets.
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