For Immediate Release
Chicago, IL – November 11, 2016 – Zacks Equity Research highlights definitely Ubiquiti (NASDAQ:(UBNT - Free Report) – Free Report) as the Bull of the Day and Abaxis (NASDAQ:(ABAX - Free Report) – Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Walt Disney Company (NYSE:(DIS - Free Report) – Free Report).
Here is a synopsis of all three stocks:
Bull of the Day:
Ubiquiti ( NASDAQ:(UBNT - Free Report) – Free Report) develops networking technology for service providers and enterprises worldwide. The company’s service provider product platforms offer carrier-class network infrastructure for fixed wireless broadband, wireless backhaul systems, and routing; and enterprise product platforms provide wireless LAN infrastructure, video surveillance products, switching and routing solutions, and machine-to-machine communication components. Ubiquiti was founded in 2003, is based in San Jose, California and has over 500 employees. The stock is Zacks Rank #1 (Strong Buy) and todays Bull of the Day.
Ubiquiti has a market cap of $4 billion with a forward PE of 18. The stock sports Zacks Style Scores of “C” in both Value and Growth, but “A” in Momentum. The company sits in an industry that is ranked 49 out of 265 (Top 18%) in the Zacks Industry Rank. Q1 earnings and guidance were impressive and the recent dip in the stock is a buying opportunity.
Q1 Earnings and Guidance
Ubiquiti released its third quarter earnings on November 3rd with a 32% beat. The company reported $0.79 verse the $0.69 expected. Revenue came in at $204.8 million verse the $185 million expected. Gross profit was seen at 48.0 versus the 48.3% seen last quarter.
In addition to the earnings beat, the company raised guidance for the second quarter. They now see a range of $0.73-0.79 verse the $0.69 expected. Revenue is now expected at $200-210 million verse the $188 million expected.
Traders reacted very positively to the numbers at first, sending the stock up 15% after hours. However, the next morning the stock lost almost all of its gains. This was likely traders taking profits after a nice run up in the stock. Looking into estimates, they might regret taking profits, as analysts are taking estimates higher.
Since earnings, estimates have ticked higher across all time frames. For fiscal 2017, estimates have come up over 11% over the last 7 days, going from $2.66 to $2.96. For the current quarter, there has been a 13% jump, from $0.66 to $0.75. Earnings will next be reported on February 2nd, where the company will go for its ninth straight beat.
8 Straight Beats
Looking at the charts, the stock is now back to 2014 highs and looks to breakout above those levels. After basing in the lower $30s the stock exploded higher after fifth straight EPS surprise to the upside. Now three beats later, the stock is ready to charge into 2017 at all-time highs.
Moreover, the stock is currently holding its 50-day moving average and as long as it holds its post-earnings low above $50, it should grind higher.
Bear of the Day :
Abaxis ( NASDAQ:(ABAX - Free Report) – Free Report) develops, manufactures, markets, and sells portable blood analysis systems for use in human or veterinary patient care settings to provide rapid blood constituent measurements for clinicians worldwide. A miss on earnings and weakness in the sector due to a Trump presidency is making investors nervous. For these reasons Abaxis is the Bear of the Day after falling to a Zacks Rank #5 (Strong Sell).
The company has a market cap of $1.1 Billion with a PE of 38. The stock has Zacks Style Scores of “F” in Value and “D” in Growth. The company resides in an industry ranked 65 out of 265 (Top 25%) of the Zacks Industry Rank. However, the threat to Obamacare is a threat to medical device makers and the sector could suffer under Trump.
Earnings and Outlook
On October 25th, Abaxis reported earnings that caused the stock to fall 10%. The second quarter EPS came in at $0.34 versus the $0.36 expected, with revenues coming in below the $61.4 million expected at $58.6 million.
CEO Clinton Severson reviewed the quarter: "The results for Q2 continued to build on the progress achieved in Q1. Medical market revenues increased 9% and veterinary market revenues grew by 4%, compared to the same period last year. Consumables sales accounted for 78% of total revenues and increased by 9% during the quarter, compared to the same period last year. Additionally, we achieved international sales growth of 7% over the same period last year. We were particularly pleased with revenue growth of 19% in medical reagent discs over the same period last year and unit sales of medical reagent discs now account for 40% of total reagent disc unit sales.”
While the tone was upbeat, traders sold the stock aggressively lower, to levels not seen since July. The stock has recovered half its losses, but investors might want to get out here as estimate revisions are headed lower.
Over the last month estimates have fallen for both the current year and next year. In addition, analysts are in full agreement in bringing down the numbers with a total of seven revision lower over for both 2017 and 2018.
For 2017, estimates have fallen 3% from $1.35 to $1.31. For 2018, there has been a 4.6% drop from $1.57 to $1.50. Abaxis will next report January 26 th, expect the stock to remain week into the report as it could see its third straight miss on EPS.
Disney (DIS - Free Report) Misses Earnings and Revenues Estimates, ESPN Sheds Subscribers
The Walt Disney Company (NYSE:(DIS - Free Report) – Free Report) just released its fourth-quarter earnings results, posting earnings of $1.10 per share and revenue of $13.52 billion.
Currently, DIS has a Zacks Rank #3 (Hold), but it is subject to change following the release of the company’s latest earnings report. Here are 5 key statistics from this just announced report below.
Missed earnings estimates. The company posted earnings of $1.10 per share, just edging out our Zacks Consensus Estimate of $1.15.
Missed revenue estimates . The company saw revenue figures of $13.14 billion, missing our estimate of $13.47 billion.
Media Networks revenue fell 3% to $5.658 billion. This was pushed by a 7% drop in cable networks revenue, which fell to $3.9 billion. The company stayed silent on specific ESPN numbers, but it did mention that a “decline in subscribers” for the channel contributed to lower revenue.
Studio Entertainment revenue grew 2% to $1.811 billion, while Parks and Resorts revenue grew 1% to $4.386 billion.
DIS was down 2.67% to $92.42 as of 5:03 p.m. EST in after-hours trading shortly after its earnings report was released.
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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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