For Immediate Release
Chicago, IL – January 11, 2012 – Zacks Equity Research highlights WESCO International ( (WCC - Free Report) as the Bull of the Day and Darden Restaurants, Inc. ( (DRI - Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Apple Inc ( (AAPL - Free Report) , Google Inc ( and Research In Motion Inc. ( .
Full analysis of all these stocks is available at https://at.zacks.com/?id=2678.
Here is a synopsis of all five stocks:
Bull of the Day:
WESCO International ( (WCC - Free Report) is one of the largest distributors of electrical products in the U.S. The company's third quarter results beat the Zacks Consensus and forward guidance was encouraging.
WESCO's strong market position, the improved conditions in the industrial and utility markets, strengthening construction markets, the global account model, restructuring benefits and the LEAN initiative are strong positives. Therefore, although results bear a positive correlation to GDP growth (which was not that impressive in 2011) and operating margins continue to lag the company's target, we think the time is right to buy the shares.
We therefore upgrade the shares to Outperform from Neutral. We have set a target price of $67 (15.4X P/E), which is a premium to the peer group.
Bear of the Day:
Although Darden Restaurants, Inc. ( (DRI - Free Report) registered improving blended comparable restaurant sales for the last few quarters, recent woes at Olive Garden continue to nag the company. Stiff competition resulting in higher discounting rates and promotional offers, increasing food costs for the upcoming quarter and cautious consumer spending add to the worry.
Moreover, a recent cut in guidance compels us to downgrade the stock from a Neutral to Underperform recommendation. The company now expects earnings per share from continuing operations to grow 4 7% as against the lower end of 12-15% guided earlier.
Our six-month target price of $40.00 equates to about 11.2x our estimate for 2012. The target price implies an expected total negative return of 9.5% over that period. We recommend an Underperform rating on the shares.
Latest Posts on the Zacks Analyst Blog:
Apple’s iOS Market Share Rises
The popularity of Apple Inc’s ( (AAPL - Free Report) operating system appears to be on the rise, according to recent numbers released by the NPD Group. According to NPD, Apple’siOS market share in the US. surged from 26% to 43% from October to November.
The NPD Group has yet to release data for the month of December. However, it has found that on Christmas Day, 6.8 million Android and iOS devices had been activated. This was up significantly from the comparable year-ago period. When the fourth quarter reports are finally released, it will likely be a close finish between the two.
Apple’s Peers Suffer a Fall
During the same period, Google Inc’s ( Android market share plummeted from 60% to 47%. Nonetheless, Android remained the leading operating system (OS).
Other operators such as Research In Motion Inc.’s ( market share dwindled from 8% in the previous quarter to 6% in October and November combined. This is a far cry from the 21% share it had in the third quarter of 2010. As it stands now, the race seems to be predominately between iOS and Android.
Meanwhile, Apple’s smartphones have been the most sought after products during the October and November period. Apple’s iPhone 4S, iPhone 4 and iPhone 3GS were the top three purchases. Samsung’s Galaxy S products (4G and II) came in fourth and fifth, respectively.
Apple’s iPhone 4S has gained popularity and is expected to boost the company’s top line significantly in the current quarter. The new iPhone has reported strong sales in the U.S. and U.K. However, iPhone 4S did not fare as well in Europe amid the macro-economic concerns.
Emerging markets such as Brazil, Mexico, Russia and China are becoming more important to Apple, representing 16% of overall sales.
Get the full analysis of all these stocks by going to https://at.zacks.com/?id=2649.
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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Updated throughout every trading day, the Analyst Blog provides analysis from Zacks Equity Research about the latest news and events impacting stocks and the financial markets.
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