Magna International, Hibbett Sports, Juniper Networks, VMware and Alcatel-Lucent highlighted as Zacks Bull and Bear of the Day
CHICAGO, Aug. 30, 2013 /PRNewswire/ — Zacks Equity Research highlights Magna International Inc. (NYSE: MGA–Free Report) as the Bull of the Day and Hibbett Sports, Inc. (Nasdaq: HIBB–Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on the Juniper Networks (NYSE: JNPR–Free Report), VMware (NYSE: VMW–Free Report) and Alcatel-Lucent, S.A. (NYSE: ALU–Free Report).
Here is a synopsis of all five stocks:
Bull of the Day:
Tesla has made cars sexy again. The auto industry is in the middle of a renaissance, and that includes the auto parts suppliers like Magna International Inc. (NYSE: MGA–Free Report). This Zacks Rank #1 (Strong Buy) has surprised on the Zacks Consensus Estimate 7 quarters in a row.
Magna is based in Ontario, Canada and has 315 manufacturing operations in 29 countries. Its customers encompass nearly every auto company in the world. It produces body, chassis, interiors, exteriors, seating, powertrain, electronics, mirrors, closures and roof systems.
On Aug 8, Magna reported second quarter earnings and beat the Zacks Consensus by 11.3%. Sales jumped 16% to a record$8.96 billion. This was better than vehicle production which rose 7% in North America and fell 1% in Europe.
Complete vehicle assembly sales jumped 23% to $796 million compared to $645 million last year.
The auto supplier is optimistic about North American production. It gave 2013 guidance of 16.1 million vehicles.
It also raised full year revenue guidance to the range of $33.3 billion to $34.7 billion from its previous guidance of $32.6 billion to $34 billion.
Magna didn’t give EPS guidance but that didn’t stop the analysts from raising their estimates for both 2013 and 2014 after the big earnings beat.
8 out of 10 estimates have moved higher for 2013 since the report, pushing the Zacks Consensus Estimate up to $6.14 from$5.96.
What’s going on in the sporting goods market? Hibbett Sports, Inc. (Nasdaq: HIBB–Free Report) recently lowered fiscal 2014 earnings and same store sales guidance.
This Zacks Rank #5 (Strong Sell) is only expected to grow earnings by 1.3% in fiscal 2014 as the retail environment remains challenging.
Hibbett Sports operates sporting goods stores predominantly in the South, Southwest, Mid-Atlantic and Midwest regions of the U.S. Its stores average about 5,000-square-feet and are located in strip malls and enclosed malls in small to mid-sized markets.
On Aug 23, Hibbett reported second quarter results and did beat the Zacks Consensus by 2 cents. Earnings were 40 centscompared to the Consensus of 38 cents.
But comparable same store sales rose just 0.3% year over year. The company blamed the soft sales on a “challenging economic environment.”
Despite being encouraged by a strong start to the third quarter, and beating the Consensus Estimate for the second quarter, Hibbett still lowered its full year earnings guidance to the range of $2.65 to $2.77 from previous guidance of $2.85 to $3.05.
Full year comparable store sales are now expected to be in the low single-digit range which is down from the low to mid single-digit range it had been forecasting.
The analysts didn’t wait around for more news. They cut fiscal 2014 to $2.76 from $2.91 but they also aren’t optimistic on fiscal 2015 either. They slashed fiscal 2015 to $3.16 from $3.35.
Juniper, VMWare Expand Partnership
One of the leading providers of networking solutions and communications devices, Juniper Networks (NYSE: JNPR–Free Report) recently announced that it has extended its partnership with VMware (NYSE: VMW–Free Report) to offer solutions for connecting virtual and physical networks within a virtual data center. VMware is an industry-leading virtualization software company.
The partnership involves Juniper’s VMware NSX L2 Gateway integration and VXLAN routing products that enable connection within a data center and between data centers and speed up the transition to software-defined networking (SDN). Considering VMware’s market position and customer clout, the partnership should help Juniper Networks expand its customer base.
The increasing complexity in cloud infrastructure has led to growing demand for SDN solutions. These solutions increase the flexibility of the infrastructure and reduce costs for companies. It is expected that the lower cost proposition will lead to quicker adoption of SDN technology, which bodes well for suppliers such as Juniper.
Juniper’s second-quarter 2013 revenues moved up 7.2% to $1.15 billion from the year-ago quarter and 8.6% sequentially. It is witnessing strong revenue growth in some of its key business markets and is gaining traction in its routing and switching portfolio. The company’s new products, cost reduction initiatives and improving execution are expected to remain the positives, going forward.
Juniper Networks Inc. is a leading provider of networking solutions and communications devices. The company develops, designs and sells products that help to build network infrastructure, which are used for services and applications based on single Internet protocol networks worldwide.
However, the pending outcome of the SEC investigation, competition from Alcatel-Lucent, S.A. (NYSE: ALU–Free Report), among others, still-sluggish federal spending and unfavorable macroeconomic conditions remain near-term headwinds.
Currently, Juniper has a Zacks Rank #2 (Buy).
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 the Analyst Blog
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.
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.
Zacks “Profit from the Pros” e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Click here to subscribe to this free newsletter today.
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978. The later formation of the Zacks Rank, a proprietary stock picking system; continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it’s your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros.
Join us on Facebook: http://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.
Zacks Investment Research
800-767-3771 ext. 9339
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 http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
SOURCE Zacks Investment Research, Inc.