Back to top

HollyFrontier, Culp, CME Group, Riot Blockchain and Bitcoin Investment Trust highlighted as Zacks Bull and Bear of the Day

Read MoreHide Full Article

For Immediate Release

Chicago, IL – June 25, 2018 – Zacks Equity Research highlights HollyFrontier Corporation (HFC - Free Report) as the Bull of the Day, Culp Inc. (CULP - Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on CME Group (CME - Free Report) , Riot Blockchain (RIOT - Free Report) and Bitcoin Investment Trust (GBTC - Free Report) .

Here is a synopsis of all five stocks:

Bull of the Day:

HollyFrontier Corporation, a Zacks Rank #1 (Strong Buy) is engaged in refining petroleum. It produces and markets gasoline, diesel, jet fuel, asphalt, heavy products and specialty lubricant products. HollyFrontier Corporation, formerly known as Holly Corporation, is headquartered in Dallas, Texas.

Recent Earnings Data

In its Q1 earnings report HFC crushed both the Zacks consensus earnings and revenue estimates as all segments beat expectations. Earnings grew to $0.77 from -$0.19 in the year ago quarter while revenues improved by +34%. The company’s impressive results were due to expanding margins, lower operating expenses, and higher throughput.  Also, the Logistics, and Lubricants and Specialty segments performed better than anticipated.  Further, the company refined more barrels of oil per day than expected (466 million barrels per day vs the expected 444 million), and reduced its overall cost to produce each barrel ($5.69 vs expected $5.98).

Management’s Take

According to George Damiris, President and CEO, “HollyFrontier's strong financial results reflect our ability to capitalize on the refining margins and crude spreads available during the first quarter. To date, crude spreads have been consistent, and we are optimistic about refining and lubricant margins going into the summer.”

Bear of the Day:

Culp Inc., a Zacks Rank #5 (Strong Sell), manufactures, sources, markets, and sells mattress fabrics and upholstery fabrics. The Company's fabrics are used in the production of residential and commercial furniture and bedding products, including sofas, recliners, chairs, loveseats, sectionals, sofa-beds, office seating, panel systems, and mattress sets. It operates in two segments, Mattress Fabrics and Upholstery Fabrics. Culp, Inc. is headquartered in High Point, North Carolina.

Recent Earnings Data

The company reported Q4 18 results where they missed both the Zacks consensus earnings and revenue estimates. On a year over year basis, earnings fell by -25%, while revenues grew by +1.3%.  For FY 18 net sales improved by +4.6%, mattress fabric sales grew by +1.0%, and upholstery fabric sales improved by +10.4%. On the down side, return on capital fell from 31.6% to 25.4%, and cash flows from operations declined from $34.1 million to $27.5 million.

Future Headwinds

Lower priced imported mattress from China have grown much more than expected in FY 17 and FY 18, but Culp did not materially feel the impact until last quarter. Currently, management expects this headwind to remain for at least the next two quarters. The company has significant exposure to the $1,000 and under market which is the area where there have been the most imports. Management admitted that these imports have and are expected to have a negative impact on sales performances over the near to mid-term. The import issue is not expected to its impact high end customers as much, but this segment only accounts for a very small portion of its sales. 

Management’s Take

According to Frank Saxon, President and CEO, “As we look ahead to fiscal 2019, we are facing a significant challenge with the growth in imported Chinese mattresses and its effect on fabric demand from many of our customers. We are aware of actions being considered by the industry to address this situation in the near term, and we are optimistic that such actions will be successful.”

Additional content:

Here’s Why Bitcoin Is Tumbling Once Again

The price of bitcoin and most other major cryptocurrencies dropped sharply on Friday after financial regulators in Japan ordered several crypto exchanges to improve their anti-money laundering practices, adding to long-standing fears that government crackdowns could hurt the market.

In response to the mandate from Japan’s Financial Services Agency, bitFlyer—the largest cryptocurrency exchange in the country—suspended the creation of new accounts while it improves its practices.

“Our management and all employees are united in our understanding of how serious these issues are, as well as how serious we are in responding to them going forward,” bitFlyer said in a statement.

Japanese regulators gave the same order to five other exchanges after reportedly noticing weaknesses in how they combatted money laundering.

To some, the move might seem like a minor setback that should be expected as users and governments continue to adapt to new technologies. But Friday’s selling stems from a few legitimate concerns about what Japan’s regulatory move could mean in the near- and long-term future.

For starters, bitFlyer’s response interrupts the flow of new capital to one of the largest cryptocurrency exchanges in the world. The Japanese yen accounts for a majority of bitcoin’s daily volume, so it is obvious that any interruption in this market will cause headwinds.

Moreover, the regulatory order speaks to a greater concern for crypto enthusiasts—one which threatens the potential long-term impact of digital currencies. Widespread government crackdowns and new laws could very well diminish the overarching point of cryptocurrencies, which—for many users—is to circumvent traditional financial sector barriers.

Japan has led the way in terms of regulation so far, although other countries have joined in the effort recently. Just a few weeks back, The Wall Street Journal reported that U.S. regulators are investigating potential price manipulation at four major exchanges occurring after CME Group launched bitcoin futures.

According to CoinMarketCap.com, bitcoin prices have dropped more than 7.7% over the past 24 hours. In that time, Ethereum—the world’s second largest cryptocurrency by way of market cap—has slumped about 9.9%, Ripple has tumbled 6.5%, and Bitcoin Cash has lost more than 11.8%. Litecoin, a popular coin among traders and retail investors, has also dropped about 11.5%.

Overall, only two of the top 100 cryptocurrencies have remained in the green in the past day, based on CoinMarketCap’s data. The total capitalization of the global crypto market has shed nearly 9.5%.

Shares of crypto-proxy stocks like Riot Blockchain and the Bitcoin Investment Trust were also sharply lower on Friday morning.

Want more market analysis from this author? Make sure to follow @Ryan_McQueeney on Twitter!

Looking for Stocks with Skyrocketing Upside?

Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.

Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.

See the pot trades we're targeting>>

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 >>.

Follow us on Twitter:  https://twitter.com/zacksresearch

Join us on Facebook:  https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts

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

support@zacks.com

https://www.zacks.com

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.



More from Zacks Press Releases

You May Like