Back to top

Cirrus Logic, Skechers, Valeo SA ADR, H Lundbeck AS and Quanta Services highlighted as Zacks Bull and Bear of the Day

Read MoreHide Full Article

For Immediate Release

Chicago, IL – November 08, 2016 – Zacks Equity Research highlights definitely Cirrus Logic (NASDAQ:(CRUS - Free Report) – Free Report) as the Bull of the Day and Skechers (NYSE:(SKX - Free Report) – Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Valeo SA ADR (OTCMKTS:(VLEEY - Free Report) –Free Report),H Lundbeck AS (OTCMKTS: (HLUYY - Free Report) –Free Report) and Quanta Services (NYSE:(PWR - Free Report) – Free Report).

Here is a synopsis of all five stocks:

Bull of the Day:

Apple’s decision to remove the headphone jack from iPhone 7 surprised many, but this audio chipmaker’s content increased substantially and the transition represents huge growth opportunity going forward.

The Company

Founded in 1984 and headquartered in Austin, Texas, Cirrus Logic (NASDAQ:(CRUS - Free Report) – Free Report) is a supplier of high-precision analog and digital signal processing components for a variety of audio, energy and industrial applications. They have ~1,380 employees and ~3,200 customers worldwide. Majority of their products are sold through direct sales channels.

The company has a strong intellectual property portfolio with 2,400 patents issued and pending. Cirrus Logic is the only supplier of a complete audio IC solution from capture to playback. Their audio chips are used in the leading smartphone brands, tablets, digital headsets, wearables and many emerging smart home applications.

Apple is CRUS’s largest customer, accounting for ~78% of the revenue in the reported quarter though the company develops solutions for many industry leading global brands.

Jack-less iPhone a Boon for Cirrus

Apple’s decision to remove the headphone jack has been great for this company. Their content in each iPhone 7 unit has gone up substantially because their chips are used in new lightning EarPods and adapter.

This is a huge opportunity for Cirrus because Apple sells about 45 million units in a quarter and is expected to sell 70 million in the holiday quarter.

Many other smartphone makers are also making the switch from tradition headphones to digital headphones, following’s Apple’s lead.

Excellent Earnings and Upbeat Guidance

The chipmaker reported its Q2 fiscal 2017 results on October 27. Revenue of $428.6 million came in above the high end of their guidance thanks to better-than-expected demand for some portable audio products.

Adjusted earnings of $1.24 per share were substantially above the Zacks Consensus Estimate of $0.95 per share.

“We are extremely pleased with our progress in the September quarter as we began volume shipments of our new digital headset solution, expanded our share with boosted amplifiers and ramped production in a mid-tier smartphone at another leading customer”, said the CEO.

They also raised their guidance for the current year after solid results. Revenue is expected to range between $475 million and $515 million while GAAP gross margin is expected to be between 47 and 49%.

Bear of the Day :

Footwear stocks have not been very popular with investors this year. What lies ahead for this footwear maker whose stock has been hammered this year on growth concerns?

Founded in 1992 and headquartered in Manhattan Beach, California, Skechers (NYSE:(SKX - Free Report) – Free Report) designs, develops, markets, and distributes footwear for men, women, and children in the US and overseas Their products are available in more than 160 countries and territories.

Results Disappoint; Stock Plunges

Skechers’ Q3 earnings of $0.42 per share came in below the Zacks Consensus Estimate of $0.46 per share and were down 2.3% year-over-year. Higher expenses and currency headwinds hurt the bottom line. This was the second consecutive quarterly miss for the company.

Net sales of $942.4 million were also below the Zacks Consensus Estimate of $953 million but they were up 10.1% year-over-year. The quarterly sales increase was mainly due to strong growth in international business, which now comprises 40.1% of total sales. However domestic net sales decreased 3.4% in the quarter.

Domestic e-commerce business grew 13% during the quarter in which the company also launched its app.

Their guidance for the current quarter was also rather downbeat. Shares plunged almost 17% after the report.

Falling Estimates

Analysts have slashed their estimates for the company after disappointing results. Zacks Consensus Estimates for the current and the next fiscal year are $1.64 per share and $1.73 per share respectively, down from $1.77 and $1.92, 30 days ago. Declining estimates sent the stock to a Zacks Rank #5 (Strong Sell).

The Bottom-Line

Shares are down about 30% year-to-date and analysts remain bearish on the stock. The management also provided a bleak outlook for the current quarter.
Further the Zacks Industry Rank of 233 out of 265 (bottom 12%) also indicates chances of underperformance in the short-term. It is safer for investors to avoid this stock for the time being.

More Stocks to Sell. Now.

Beyond our Bear Stock of the Day, today's list of 220 Zacks Rank #5 Strong Sells demand even more urgent attention. If any are lurking in your portfolio or Watch List, they should be removed immediately. Many appear to be sound investments but, since 1988, such stocks have actually performed more than 11X worse than the S&P 500.

Additional content:

12 Fun Facts About U.S. Presidential Elections: Global Week Ahead

This Global Week Ahead is totally dominated by the U.S. Presidential election.

In light of that Tuesday, Nov. 8th watershed event -- and related to how incredibly tired and bored I am with the nasty election tone -- I found Karin Lehnardt of Fact Retriever’s “47 Interesting Facts About the U.S. Presidential Election” worth sharing (in part).

Here are 12 facts I found most interesting (or funny!), and relevant to this U.S. election of 2016. I added in the women’s suffrage facts.

I kept these 12 U.S. Presidential election facts in tight chronological order.

(1) George Washington blew his entire campaign budget on 160 gallons of liquor to serve to potential voters.

(2) During the 1800 presidential campaign, Thomas Jefferson secretly hired a writer named James Callender to attack his opponent, John Adams, in print. Callender called Adams a “hermaphroditical character” who neither had the “force of a man” or the “gentleness of a woman.” Callender was later jailed for insurrection.

(3) In 1845, Congress decided that voting day would be the first Tuesday after the first Monday in November, which was after the fall harvest and before winter conditions made travel too difficult.

(4) It wasn’t until 1856 that Congress removed property ownership as a requirement to vote in elections.

(5) In 1870, Congress passed the 15th Amendment, which granted the right to vote to African Americans and other nonwhite men. However, an African American’s right to vote was often denied in the South and parts of the North until the 1960s.

(6) The first woman to run for U.S. President was Victoria Woodhull in 1872, nearly 50 years before the 19th Amendment allowed women to vote in presidential elections. Her running mate, Frederick Douglass, was the first African-American ever nominated for Vice President ( Obama and Clinton have a clear 150-year old precedent!)

Over 200 women have run for President of the United States. However, this list includes nominees of many minor parties and candidates who ran for president before women won the right to vote in 1920.

(7) During the 1872 election, presidential incumbent Ulysses S. Grant ran against a corpse. His opponent -- Horace Greeley -- died before the election was finalized. Grant won the election.

(8) The first election to use a voting machine was in 1892. Though it was actually invented earlier, candidates initially opposed the idea because it eliminated the wheeling and dealing for votes over the phone.

(9) The first European country to introduce women's suffrage was the Grand Duchy of Finland in 1906. U.S. women won the vote in 1920 with the passage of the 19th Amendment.

(10) Congress gave Native Americans the right to vote in presidential elections in 1924. However, some states banned them from voting until the 1940s.

(11) American astronauts on the ISS (International Space Station) can vote in elections from orbit by secure email.

(12) The United States is ranked 139th out of 172 countries in voter participation.

Out here in California, the weary voter project is to get thru a 222-page General Election booklet. It holds the details on 17 Direct Democracy propositions. This is basically the result of a de facto 1-party state. We can’t elect the Republicans any more -- so we gin up a flood of propositions to send to the voters instead.

Top Zacks Rank Stocks—

(1) Valeo SA ADR (OTCMKTS: (VLEEY - Free Report) – Free Report) has a Zacks VGM score of A to go along with its Zacks #1 (STRONG BUY) Rank. It is a $13 billion market cap auto/truck company. The company is headquartered in Paris, France.

Valeo has four business groups supplying products to the original equipment market and the aftermarket. The 4 Business Groups are: Powertrain Systems, Thermal Systems, Comfort and Driving Assistance Systems, and Visibility Systems.

(2) H Lundbeck AS (OTCMKTS: (HLUYY - Free Report) – Free Report) has a Zacks VGM score of B, driven by a Zacks Growth score of A. It too has a short-term Zacks #1 Rank. This is a $7 billion market cap pharma stock. Pharma stocks are very beaten down stocks. This is a European company based in Copenhagen, Denmark.

H. Lundbeck products are targeted at disorders like depression and anxiety, schizophrenia, insomnia, Huntington's, epilepsies, Alzheimer's and Parkinson's diseases.

(3) Quanta Services (NYSE:(PWR - Free Report) – Free Report) has a Zacks VGM score of A, driven by an A for Zacks Growth, and a short-term Zacks #1 Rank. This is a $4.0 billion market cap engineering and R&D services firm.

Quanta is a leading provider of specialty electrical contracting and maintenance services primarily related to electric and telecommunications infrastructure in North America.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>

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 >>.

Get the full Report on CRUS - FREE

Get the full Report on SKX - FREE

Get the full Report on VLEEY - FREE

Get the full Report on HLUYY - FREE

Get the full Report on PWR - FREE

Follow us on Twitter:

Join us on Facebook:

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.

Media Contact
Zacks Investment Research

800-767-3771 ext. 9339 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. .

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 for information about the performance numbers displayed in this press release.

More from Zacks Press Releases

You May Like