Tag Archives: Zacks Rank

Business, Finance, Occupation & Industry

Big 5 Hits Home Run As Sales Boom

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By Zacks.com

Big 5 Sporting Goods Corporation (BGFV) recently delivered its third consecutive positive earnings surprise on the back of its largest same-store sales increase in over 10 years. Despite a relatively modest earnings beat, analysts revised their estimates significantly higher for both 2013 and 2014, sending the stock to a ZacksRank #1 (Strong Buy).
The company also announced a 33% increase in its quarterly dividend. It now yields a solid 2.6%. And valuation looks reasonable too with shares trading below the industry median.
Company Description
Big 5 is a sporting goods retailer in the western United States with 414 stores in 12 states. It operates under the “Big 5 Sporting Goods” name. The company was founded in 1955 and is headquartered in El Segundo, California. It has a market cap of $334 million.
Strong Fourth Quarter Results
Big 5 delivered better than expected fourth quarter results on February 26. Earnings per share came in at 19 cents, beating the Zacks Consensus Estimate by a penny. It was the company’s third straight positive earnings surprise.
Net sales increased 7.4% to $243.6 million, ahead of the Zacks Consensus Estimate of $242.0 million. This was driven by a 6.5% increase in same-store sales, which was its largest increase in over 10 years. Meanwhile, the gross profit margin expanded 100 basis points to 32.2% of net sales. On top of this, the company leveraged its selling and administrative expenses, which declined 210 basis points to 29.2% of net sales.
In the press release, the company also announced a 33% increase in its quarterly dividend to 10 cents per share. It now yields a solid 2.6%.
Estimates Surging Higher
Despite a relatively modest EPS beat, analysts revised their estimates significantly higher for both 2013 and 2014, sending the stock to a Zacks Rank #1 (Strong Buy). Over the last 30 days, the 2013 consensus has surged from $0.88 to $1.07. Meanwhile, the 2014 consensus has increased from $1.09 to $1.23.
Based on current consensus estimates, analysts project 47% EPS growth this year and 15% growth next year. The company currently anticipates opening approximately 15-20 new stores in 2013, including three relocations, and closing approximately three relocated stores.
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Reasonable Valuation
Given Big 5’s strong growth projections, you might expect a sky-high P/E multiple. But that’s not the case. Shares trade a relatively modest 14x 12-month forward earnings, a discount to the industry multiple of 16x. And its price to book ratio of 2.0 is well below the 3.3 median for its peers. …read more
Source: FULL ARTICLE at Forbes Markets

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Progressive Waste Down In The Dumps After Earnings Miss

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By Zacks.com, Contributor

Progressive Waste Solutions Ltd. (BIN) reported a fourth quarter earnings miss, and management provided weak guidance for 2013. This prompted analysts to revise their estimates lower for both 2013 and 2014, sending the stock to a Zacks Rank #5 (Strong Sell) stock. Although shares have sold off a bit after the report, valuations still do not look cheap. Progressive Waste Solutions is a full-service waste management company that provides non-hazardous solid waste collection, recycling and disposal services to commercial, industrial, municipal and residential customers in 13 U.S. states and the District of Columbia and six Canadian provinces. It is headquartered in Vaughan, Canada and has a market cap of $2.4 billion. Earnings Miss, Weak Guidance Progressive Waste Solutions reported its Q4 results on February 14. Earnings per share came in at 24 cents, missing the Zacks Consensus Estimate by 8%. This marked the company’s third earnings miss in the last four quarters. EPS was also 25% lower than in the same quarter in 2011. Revenues did rise 8%, but this was driven mostly by acquisitions and favorable foreign currency effects. Organic revenues were up just 0.6%. Meanwhile, adjusted operating income fell 19% year-over-year. Management also provided weak guidance for 2013, prompting virtually every analyst to revise his estimates lower for both 2013 and 2014. This sent the stock to a Zacks Rank #5 (Strong Sell). The 2013 Zacks Consensus Estimate has fallen 16% since the Q4 report to $0.99, while the 2014 consensus is down 8% to $1.23. The Zacks Industry Rank isn’t very bullish either. The ‘Pollution Control’ industry ranks in the bottom quartile of all the industries that we rank. Special Offer: Stocks recommended in Forbes Dividend Investor are up 12.6% since July 11, 2011, versus 7.3% for the S&P 500.  Click here for a trial subscription with instant access to all picks and the Top 25 portfolio.  Average yield is 5.7%. Premium Valuation Shares of Progressive Waste are down about 8% since the Q4 earnings release, but the stock still looks a bit pricey. BIN trades at 20x 12-month forward earnings, ahead of the industry median of 18x and the stock‘s historical median of 19x. Progressive Waste also carries a long-term ‘Underperform’ Zacks Recommendation. The Bottom Line With negative earnings momentum, sluggish organic top-line growth and premium valuation, don’t expect strong outperformance from this stock anytime soon. BIN data by YCharts Todd Bunton is the Growth & Income Stock Strategist for Zacks Investment Research and Editor of the Income Plus Investor service. …read more
Source: FULL ARTICLE at Forbes Latest

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IGT Beats The House Through Online Reinvention

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By Zacks.com, Contributor

This stock might not be as much of a gamble as you think. International Gaming technology (IGT ) is a Zacks Rank #2 and trades at just over 12 times forward earnings. The company has beaten the Zacks Consensus Estimates two earnings reports in a row (5 of the last 6), exceeding analysts’ expectations by an average of 17.4%. …read more
Source: FULL ARTICLE at Forbes Latest

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Avery Dennison Turns Triple Play, Stock Tagging Fresh Highs

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By Zacks.com, Contributor

Avery Dennison completed a triple play in the fourth quarter: a positive earnings surprise, a positive sales surprise, and strong management guidance. This prompted analysts to revise their estimates higher for both 2013 and 2014, sending the stock to a Zacks Rank #1 (Strong Buy) stock. Although shares have risen more than 10% off the strong quarter, valuations still look very reasonable. So shares of Avery Dennison have plenty of room to continue marching higher. Avery Dennison manufactures labeling and packaging materials for a wide variety of industries around the globe. It reports its results in three segments: -Pressure-sensitive Materials: 71% of total sales -Retail Branding & Information Solutions: 25% -Other Specialty Converting Businesses: 4% Pressure-sensitive materials consist primarily of papers, plastic films, metal foils and fabrics, which are coated with special adhesives, and then laminated with specially coated backing papers and films. These label and packaging materials are sold worldwide to label printers and converters for labeling, decorating, fastening, electronic data processing and special applications in the home and personal care, beer and beverage, durables, pharmaceutical, wine and spirits, and food market segments. The Retail Branding & Information Solutions segment makes a wide variety of brand identification and information management products for retailers, apparel manufacturers, distributors and industrial customers around the globe. Its brand identification products include woven and printed labels, graphic tags and barcode tags, and its information management products include price tickets, carton labels, RFID tags and printing applications. Avery Dennison was founded in 1935 and is headquartered in Pasadena, California. It has a market cap of $4.0 billion. Special Offer: We asked some of the most successful investors in the country to name their #1 pick for 2013. Get details on their top 10 stocks in this free report, Forbes Top Stocks for 2013…10 to Buy Now. Solid Fourth Quarter Results Avery Dennison delivered better-than-expected Q4 results on January 30. Earnings per share came in at 54 cents, well ahead of the Zacks Consensus Estimate of 49 cents. It was a 50% increase over the same quarter in 2011. Net sales rose 5% to $1.532 billion, beating the Zacks Consensus Estimate of $1.486 billion. Organic sales growth was even better at 7%. The Pressure-sensitive Materials segment saw organic top-line growth of 6% while sales in Retail Branding & Information Solutions jumped 10%, driven by increased demand from U.S. and European retailers and brands, including accelerating RFID adoption. Meanwhile, the adjusted operating margin expanded 170 basis points to 6.6%. Bullish Guidance Following strong Q4 results, management provided encouraging guidance for 2013. The company expects adjusted EPS from continuing operations of $2.40 to $2.80 in 2013, which prompted analysts to revise their estimates higher. The ZacksConsensus Estimate for 2013 is now $2.57, up from $2.45 before the Q4 release. This represents 23% growth over 2012 EPS. The 2014 consensus increased too, rising 15 cents to $2.86. This corresponds with 12% annual EPS growth. It is a Zacks Rank #1 (Strong Buy) stock. Valuation Shares of AVY are up …read more
Source: FULL ARTICLE at Forbes Latest

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Caterpillar Crawls To A Standstill After Years Of Explosive Growth

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By Zacks.com, Contributor

After three years of double digit earnings growth, including 93% growth in 2010, it looks like Caterpillar (CAT) is going to hit a wall in 2013 as earnings are expected to decline by 4.4%. The bad news started with a 13% fourth quarter 2012 earnings miss even as the company reported record full year 2012 sales. The world’s largest construction and mining equipment maker also had the embarrassing episode of having to announce it was writing down $580 million for its purchase of Zhengzhou Siwei Mechanical & Electrical Manufacturing, which made roof-support equipment for underground coal mines, after it discovered discrepancies in the physical inventory after it closed on the deal in October 2012. It blamed “coordinated accounting misconduct” inside the Chinese company. That acquisition had been the company’s largest Asia investment since 2010. Revenue fell to $16.08 billion from $17.24 billion in the fourth quarter of 2011 as China slowed and Europe remained mired in a recession. Inventory was lowered by $2 billion in the quarter. Special Offer: What you don’t own is just as important as what investments you do own. Top investing experts named names when it comes to securities to avoid in the year ahead. Get the results in this free downloadable report, 24 Widely-Held Investments You Should Sell Now. Caterpillar announced a huge EPS guidance range for 2013, which signals that it basically has no idea how business is going to be this year. It expects earnings anywhere from $7.00 to $9.00. China is still expected to be weak in the first half of 2013 which leaves a second half of the year rally to revive the company’s prospects. But will it? Eleven estimates have come down for 2013 in the last 30 days. The 2013 Zacks Consensus has fallen to $8.25 from $8.69 a month ago. The stock has slid to a Zacks Rank #5 (Strong Sell). CAT data by YCharts Tracey Ryniec is the value stock strategist for Zacks.com. She is also the editor of the Turnaround Trader and Value Investor services. You can follow her on twitter at @TraceyRyniec. Read the full Analyst Report on CAT …read more
Source: FULL ARTICLE at Forbes Latest

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Despite Super Bowl Ad Rejection, SodaStream Remains Bubbly

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By Zacks.com, Contributor

Getting a commercial rejected from the Super Bowl telecast is turning out to be the best thing to happen to SodaStream International (SODA) in quite some time. The maker of home beverage carbonation systems had its first ever Super Bowl commercial rejected by CBS, supposedly due to the references made to two of the biggest sponsors of the Super Bowl, Coke and Pepsi. It ran a shorter, and tamer commercial during the game instead. But the original commercial, entitled “Game Changer” has been put up on YouTube and has already garnered 4.3 million views and counting. Not too shabby for a company with a $990 million market cap making its first advertising push into the U.S. market. SodaStream, headquartered in Israel, makes home soda makers, flavored syrups, gas cylinders and bottles. It entered the U.S. market in 2009. The U.S. market now makes up about a third of the company’s sales and turned profitable in 2012. It sells its beverage systems in 15,000 retailers across the United States and in thousands of retailers worldwide. SodaStream went public in November 2010. Since then, it has been a growth machine. In 2012, earnings are expected to grow 57%. Analysts expect another 27% growth in 2013 and over the next five years, earnings are projected to grow 30.4%. On Nov. 7, SODA reported record third quarter results. Revenue jumped 48.7% to $112.5 million as it saw gains in all geographic regions and product categories. Earnings rose 66.7% to 80 cents per share, which beat the Zacks Consensus by 17.7%. SodaStream has been running circles around the analysts. It has surprised on every earnings report since it went public in 2010. It is expected to report fourth quarter results on March 6. The Zacks Consensus Estimate is looking for 38 cents. Stay tuned. Special Offer: If you’ll be paying for college anytime in the next decade, don’t miss this new free report. There are many moves you can make today to lower college costs and increase financial aid options. Find out how in 12 Insider Tricks to Pay For College. Read it now FREE. It’s not every day that you can find a company with strong double digit earnings growth and a valuation that isn’t at nosebleed levels. SodaStream trades with a forward P/E of 18 which is more expensive than the S&P 500 at 13.5x, but compared with high growth peers, it is downright cheap. It also has other solid fundamentals. SodaStream has a 1-year return on equity (ROE) of 18.1%, which is well above its peers at 10.6%. SodaStream is a Zacks Rank #1 (Strong Buy). It’s got the great combination of being a small-cap aggressive growth company with still manageable valuations. SODA data by YCharts Tracey Ryniec is the Value Stock Strategist for Zacks.com. She is also the Editor of the Turnaround Trader and Value Investor services. You can follow her on twitter at @TraceyRyniec. Read the full Snapshot Report on SODA …read more
Source: FULL ARTICLE at Forbes Latest

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Still Time To Harvest Growth From This Agricultural Equipment Maker

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By Zacks.com, Contributor Lindsay Corp. (LNN) delivered a big fiscal first quarter earnings beat in January. The company, which provides irrigation systems and infrastructure products, experienced strong top-line growth and saw profit margin expansion in the quarter, leading to a 400% increase in earnings per share. Earnings estimates jumped significantly higher after the beat, sending the stock to a Zacks Rank of 1 (Strong Buy). Lindsay manufactures irrigation equipment primarily used in agricultural markets. It also manufactures infrastructure and road safety products through its wholly owned subsidiaries, Barrier Systems and Snoline S.P.A. Lindsay was founded in 1954 and has a market cap of $1.2 billion. On January 8, Lindsay reported results for the first quarter of its fiscal 2013. Earnings per share came in a $1.15, crushing the Zacks Consensus Estimate of $0.75. Revenue soared 24% to $147 million, well ahead of the consensus of $130 million. This was primarily driven by a 33% increase in irrigation equipment revenues. Domestic irrigation revenues were particularly strong with a 59% increase over the same quarter last year. The gross profit margin expanded from 25.4% to 29.1% as due to lower input costs, a strong pricing environment and the leveraging of fixed costs. The operating profit margin expanded from 4.3% to a whopping 15.1%. And the backlog of unshipped orders was strong too as drought conditions combined with positive farmer sentiment, farm incomes and commodity prices continued into fiscal 2013. As of November 30, 2012, Lindsay recorded a backlog of $85.1 million compared with $52.8 million on the same date last year. Special Offer: If you’ll be paying for college anytime in the next decade, don’t miss this new free report. There are many moves you can make today to lower college costs and increase financial aid options. Find out how in 12 Insider Tricks to Pay For College. Read it now FREE. Given the huge first quarter beat and strong backlog, analysts revised their estimates significantly higher for both 2013 and 2014. This sent shares to a Zacks Rank of 1 (Strong Buy). The 2013 Zacks Consensus Estimate increased from $4.12 before the report to $4.86 after it. And the 2014 consensus jumped from $4.40 to $5.01. The valuation picture looks reasonable for LNN. Shares trade at 19x forward earnings, which is a premium to the industry group but a discount to its 10-year median forward multiple of 22x. LNN also boasts a debt-free balance sheet and strong returns on invested capital. With a strong earnings and revenue beat, rising estimates and reasonable valuation, Lindsay offers a lot to like. LNN data by YCharts Todd Bunton is the Growth & Income Stock Strategist for Zacks Investment Research and Editor of the Income Plus Investor service.
Source: FULL ARTICLE at Forbes Latest

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Mellanox Technologies Stumbles In The Fourth Quarter

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By Zacks.com, Contributor Mellanox Technologies (MLNX) delivered mixed fourth quarter results on January 23. Revenue was mostly in line with expectations, but earnings per share fell well short of the Zacks Consensus Estimate. The company’s first quarter revenue guidance was also significantly below consensus, prompting a flurry of negative estimate revisions from analysts. It is a Zacks Rank #5 (Strong Sell). Mellanox supplies end-to-end InfiniBand and Ethernet interconnect solutions and services for servers and storage. Fourth quarter revenues surged 68% to $122 million, ahead of the consensus of $120 million. However, the gross profit margin declined 50 basis points quarter-over-quarter to 70.0%. Earnings per share came in at 47 cents, missing the Zacks Consensus Estimate of 55 cents. Special Offer: We asked some of the most successful investors in the country to name their #1 pick for 2013. Get details on their top 10 stocks in this free report, Forbes Top Stocks for 2013…10 to Buy Now. On the conference call, management provided weak first quarter revenue guidance, and analysts unanimously cut their estimates for both 2013 and 2014. The 2013 Zacks Consensus Estimate is now $1.43, down from $3.27 before the report. And the 2014 consensus slid from $4.39 to $2.35. It is a Zacks Rank #5 (Strong Sell). In addition to negative earnings momentum, shares look pricey too. Mellanox now trades at a frothy 36x 12-month forward earnings, well ahead of the industry median of 23x. The stock also carries a long-term ‘Underperform’ Zacks Recommendation. MLNX data by YCharts Todd Bunton is the growth & income stock strategist for Zacks Investment Research and editor of the Income Plus Investor service.
Source: FULL ARTICLE at Forbes Latest

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ResMed Stock Still Breathes Easy After 60% Run To New Highs

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By Zacks.com, Contributor Another record quarter for ResMed boosted this maker of sleep apnea products back to a Zacks #1 Rank this week. In the San Diego-based company’s earnings report last week, EPS for the second quarter of FY13 came in at 53 cents, a 4% beat over the analyst consensus. This is ResMed’s 5th consecutive earnings beat and its 15th beat of the last 17 quarters. And investors who were not awake for this story got on board after this report, driving the stock up 5.5% last Friday to new all-time highs above $48. A Sleeper in Medical Devices Honestly, I had no idea what this company was about until a few weeks ago when I saw the stock as a big gainer in my colleague Brian Bolan’s HomeRun Investor portfolio. He woke up to the growth story in early August of last year after a big earnings beat and jumped on the shares in the mid-30s. ResMed Inc. (RMD – Snapshot Report) is a leading designer, manufacturer and distributor of medical equipment for treating and diagnosing sleep disordered breathing. Sleep disordered breathing includes sleep apnea and related respiratory conditions. The company sells a comprehensive range of diagnostic and treatment devices in countries through a combination of wholly owned subsidiaries and independent distributors. New Awareness, New Growth Revenues soared 13% year over year to $376.5 million, a record high for ResMed. Riding on the back of increasing awareness regarding sleep-disordered breathing and a vastly under-penetrated and growing sleep-disorder breathing market, revenues in the Americas surged 16% to $211.8 million whereas revenues outside the Americas increased 10% at $164.7 million. Growth in the overseas market was due to strong contributions from Germany, France, the U.K. and Japan. As more physicians diagnose sleep-related breathing disorders, the demand for ResMed solutions and diagnostics continues to grow. And the international markets clearly offer some of the biggest growth opportunities ahead for the company. How the Zacks Rank Picked This Winner Looking back at the historical Zacks Rank for RMD, it appears the stock has consistently been a #1 Strong Buy or #2 Buy since late 2011. And growth investors recognized this earnings momentum, taking the stock from $24 in December 2011 to a double in 13 months. To see why the rising earnings estimates made this so, you need only look at the Price & Consensus chart, which plots the shifting earnings consensus for a given year against the stock price. Attractive, Steady Growth ResMed’s current path of revenue and earnings growth are both in the mid-teens. In the medical products industry group, it trades slightly above peers on a trailing P/E basis at 24X vs. 20X. But its price to sales ratio is 4.8X vs an industry average of 7.7X. With the recent spike in shares, investors may want to wait and see if they can catch a drift lower that possibly threatens to fill the price gap up from below $46. But be aware that the last big earnings beat which launched the shares from $32 to $36 never saw a “look back” to fill that gap. With the stock‘s 50 and 100-day moving averages on a steep ascent down around $42 right now, it is likely shares do spend some time resting below the recent highs. And investors will be watching both the company’s sales and the rising public awareness of sleep-related breathing disorders in the run-up to their next report in April. Kevin Cook is a Senior Stock Strategist with Zacks.com
Source: FULL ARTICLE at Forbes Latest

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Taubman Centers Riding The REIT Rebound

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By Zacks.com, Contributor Taubman Centers (TCO) has increased its dividend 15 times since it went public in 1992, and currently pays a regular quarterly dividend that yields 2.3% annually. Furthermore, this Zacks Rank #2 (Buy) REIT reported impressive third-quarter results in October, leading to positive FFO estimate revisions for 2013.
Source: FULL ARTICLE at Forbes Latest