The Dallas-based chemical giant Celanese Corp. (CE) recently completed the sale of its polyvinyl alcohol (PVOH) business to Japanese peers Sekisui Chemical Co. The company sold the business for $173 million following an agreement signed in April.

The PVOH business, a part of Celanese's Industrial Specialties segment, produces and sells a broad portfolio of performance chemicals engineered to meet specific customer requirements. The PVOH products are used in paints and coatings, adhesives, building and construction, glass fiber, textiles and paper.

The sale of the PVOH business includes its facilities in Calvert City, Kentucky, Pasadena, Texas, one unit within the complex at Tarragona, Spain, and resources from Celanese's Houston Technology Center. As many as 250 employees located at these operations will be transferred to Sekisui. There will also be long-term supply agreements between both the companies.

The downturn in the global economy and lower demand forced Celanese to reduce its capacities. This is expected to continue through the rest of 2009.

In the first quarter of 2009, Celanese reported a net loss from continuing operations of $20 million or $0.17 per diluted share. Net sales for the quarter declined 38% to $1.15 billion, driven by lower volumes on continued weak global demand and lower pricing for acetyl products.

In light of the above conditions, we continue to recommend CE as Sell with a target price of $16.00.

STATES WITH PROJECTED FY2010 BUDGET GAPS
State	FY2010 pre-budget	FY2010 mid-year gap	FY2010 Total	FY2010 Total % of Budget
Alabama	$1.2 billion	0	$1.2 billion	16.70%
Alaska	$1.3 billion	0	$1.3 billion	30.00%
Arizona	$4.0 billion	0	$4.0 billion	41.10%
Arkansas	$146 million	0	$146 million	3.20%
California*	$34.2 billion	$19.5 billion	$53.7 billion	58.20%
Colorado	$1.0 billion	$384 million	$1.4 billion	18.60%
Connecticut	$4.1 billion	0	$4.1 billion	23.20%
Delaware	$557 million	0	$557 million	17.60%
District of Columbia	$650 million	$150 million	$800 million	12.70%
Florida	$5.9 billion	0	$5.9 billion	22.80%
Georgia	$3.1 billion	$750 million	$3.9 billion	22.30%
Hawaii	$682 million	$297 million	$978 million	19.10%
Idaho	$411 million	0	$411 million	16.40%
Illinois	$9.2 billion	0	$9.2 billion	33.00%
Indiana	$1.1 billion	0	$1.1 billion	7.50%
Iowa	$779 million	0	$779 million	13.20%
Kansas	$1.4 billion	Yes, DK size	$1.4 billion	22.60%
Kentucky	0	$1.1 billion	$1.1 billion	11.30%
Louisiana	$1.8 billion	0	$1.8 billion	21.60%
Maine	$640 million	0	$640 million	21.40%
Maryland	$1.9 billion	Yes, DK size	$1.9 billion	13.60%
Massachusetts	$5.0 billion	0	$5.0 billion	17.90%
Michigan	$2.4 billion	0	$2.4 billion	12.00%
Minnesota	$3.2 billion	0	$3.2 billion	21.00%
Mississippi	$480 million	0	$480 million	9.60%
Missouri	$923 million	0	$923 million	10.30%
Nebraska	$150 million	0	$150 million	4.30%
Nevada	$1.2 billion	0	$1.2 billion	37.80%
New Hampshire	$250 million	0	$250 million	16.20%
New Jersey	$8.8 billion	0	$8.8 billion	29.90%
New Mexico	$345 million	0	$345 million	6.30%
New York	$17.9 billion	0	$17.9 billion	32.30%
North Carolina	$4.6 billion	0	$4.6 billion	21.90%
Ohio	$3.3 billion	0	$3.3 billion	12.30%
Oklahoma	$600 million	0	$600 million	10.50%
Oregon*	0	0	0	0.00%
Pennsylvania	$4.8 billion	0	$4.8 billion	18.00%
Rhode Island	$590 million	0	$590 million	19.20%
South Carolina	$725 million	0	$725 million	12.50%
South Dakota	$32 million	0	$32 million	2.90%
Tennessee	$1.0 billion	0	$1.0 billion	9.70%
Texas	$3.5 billion	0	$3.5 billion	9.50%
Utah	$721 million	$279 million	$1.0 billion	19.80%
Vermont	$278 million	0	$278 million	24.80%
Virginia	$1.8 billion	Yes, DK size	$1.8 billion	10.90%
Washington	$3.4 billion	$195 million	$3.6 billion	23.30%
West Virginia	$200 million	0	$200 million	5.30%
Wisconsin	$3.2 billion	0	$3.2 billion	23.20%
Wyoming	0	$32 million	$32 million	1.70%
Total	$143.2 billion	$22.7 billion	$165.9 billion	24.40%

This will lead to very drastic cuts in state budgets. Access to medical care by the poor will likely be one of the first things to be cut.

Education budgets will also probably be pared. This could be decreased spending on new textbooks, which would not be good news for publishers like McGraw-Hill (MHP) and Scholastic (SCHL).

Another area that is likely to be hit is new equipment at the municipal level. For example, I would not expect Oshkosh (OSK) to have a very good year selling new fire engines and snow removal equipment to municipalities.

Layoffs of state and municipal workers will simply add to the already high and rising unemployment rate. In short, a big part of the federal stimulus spending is being offset by (legally mandated) anti-stimulus actions at the state level.

As the graph shows, state fiscal problems tend to persist well after the recession is officially over. Indeed the problem is usually worse in the second or third year since by then the "rainy day funds" have already been used up.

Following the last recession, states collectively had their worst year in 2004 with a shortfall of $80 billion (or less than half what they face for fiscal 2010), which was well after the recession officially ended. Thus 2011, and possibly even 2012, will be a very lean year at the state level as well.

Company Description

Corrections Corporation of America ("CCA") is the largest operator of correctional and detention facilities in the United States. Only the federal government and three states are larger prison operators.

The company operates 64 facilities, with 44 of those being company owned. It has a total design capacity of about 86,000 beds in 19 states and the District of Columbia.

CCA also operates educational and rehabilitation programs as well as providing health care and food services within the correctional facilities.

Revenue Climbed 6.5% in the First Quarter

On May 7, CCA reported first quarter 2009 results that surprised on analysts' estimates by 11.54%. Earnings per share were 29 cents compared to Wall Street estimates of 26 cents per share.

Revenue rose 6.5% to $404.2 million from $379.4 million during the year ago quarter. Total compensated man-days increased 3%. The average inmate population gained 4.2% during the quarter.

Revenue from federal customers rose 5.5% to $160.1 million from $151.8 million fueled by per diem increases during 2008.

Revenue for managing state customers increased 9.5% to $211.8 million from $193.5 million in the year ago time frame.

State revenue growth was primarily due to increased inmate populations in the states of California, Colorado and Idaho, which offset declining inmate populations in Minnesota, Washington, New Mexico, and Kentucky, as well as per diem increases during 2008.

"We are pleased that we were able to capitalize on our bed developments in 2008 through the award of three new contracts during the first quarter of 2009 for nearly 4,000 additional inmates," said John Ferguson, Chief Executive Officer.

"The remaining 6,700 beds in inventory positions us for additional growth in the future," he added.

Share Repurchase Program

In Nov 2008, the company announced a $150 million share repurchase program. Through May 1, 2009, CCA repurchased 10.7 million shares for a cost of $125 million. The company accelerated share repurchases in the first quarter, spending $108.4 million on 9.6 million shares.

Guidance Clouded by State Budget Concerns

CCA provided second quarter earnings per share guidance in the range of 26 cents to 28 cents. Full year 2009 EPS is expected to be between $1.17 to $1.25 per share.

The magnitude of the economic crisis on state budgets is a not yet apparent as fiscal year 2010 budgets are due by July 1. The company cautioned that the earnings guidance included its best estimate of potential outcomes in states that are customers.

However, the company believes it will see long-term benefits from the supply and demand imbalance in the number of beds that continues in the industry.

Consensus Estimates Rise

Covering analysts appear to be cautious despite the company's guidance. Second quarter estimates are at the high end of the forecast range, at 28 cents per share, but they've been there for the last 60 days.

Full-year estimates are up 5 cents to $1.21 per share in the last 2 months but 2 have lowered and 1 has raised within the last 30 days.

Value Fundamentals

Corrections Corporation of America is a Zacks #1 Rank (strong buy) stock. It has a forward P/E of 13.33. Its price-to-book ratio is 1.48. The company has a 5-year average return on equity (ROE) of 10.15%.

Zacks Investment Research

What is a Smart-Grid?

"Smart-grids" deliver electricity from suppliers to consumers using digital technology to save energy, reduce costs and increase reliability. Many global governments are promoting such a modernized electricity network as a means of increasing energy independence and reducing global warming issues.

An electricity grid is not a single entity but an aggregate of multiple networks and multiple power generation companies with multiple operators employing varying levels of communication and coordination, most of which are manually controlled.

Smart grids increase the connectivity, automation and coordination between suppliers, consumers and networks, which perform either long distance transmission or local distribution tasks. Transmission networks move electricity in bulk over medium-to-long distances, are actively managed, and generally operate from 400kV to 800kV over AC and DC lines.

Local networks traditionally moved power in one direction, "distributing" the bulk power to consumers and businesses via lines operating at 132kV and lower. This paradigm is changing as businesses and homes begin generating more wind and solar electricity, enabling them to sell surplus energy back to their utilities.

Efficiency Through Technology

Modernization is necessary for energy consumption efficiency; real-time management of power flows; and to provide the bi-directional metering needed to compensate local producers of power. Although transmission networks are already controlled in real-time, many in the US and European countries are antiquated by world standards, and unable to handle modern challenges such as those posed by the intermittent nature of alternative electricity generation, or continental scale bulk energy transmission.

According to Deloitte, in 2009, smart grid providers may represent one of the largest and fastest growing sectors within the "clean," green energy industry. Deloitte forecasts that electricity, as a percentage of total energy consumption, will increase from 9% in 1973 to 16% through 2009.

Additionally, they estimate that modern smart-grids offer approximately twice the efficiency, at 60%, as the average efficiency of the world's legacy electricity grids at  approximately 33%.

Finally, Deloitte estimates that the annual cost  of power outages and power quality disturbances in the U.S. approximates $180 billion.

Likewise, a recent study by the U.S. Department of Energy study estimates that smart-grid modernization of U.S. electricity grids with would save between $46 to $117 billion over the next 20 years.

Among other conclusions, Deloitte deduces through its smart-grid analysis that "[M]ajor manufacturers and utilities should explore partnerships with, and consider acquisitions of, smart energy companies."  Such is the case we now see with Duke Energy and Cisco.

Both Companies Known as Trail-Blazers

At the risk of over-stating the significance of this relationship, particularly for the traditionally staid, 100+ year old electricity industry, both Duke Energy and Cisco rank as consensus innovative leaders in their respective industries. Under terms of the agreement, Cisco seeks to develop and deliver to Duke Energy a state-of-the-art, industry-leading, end-to-end, power plant-to-customer, smart-grid network communications infrastructure.

Empirically speaking, U.S. support for smart-grid technology became federal policy with passage of the Energy Independence and Security Act of 2007. Subsequently, smart-grids received additional support with the passage of the American Recovery and Reinvestment Act of 2009, which appropriated $11 billion for the creation of a smart-grid.

Support from the Federal Government

As recently as January 2009, in his National Address, President Obama requested Congress to pass legislation including the development of new electricity "smart-grids."  On March 19, 2009, The Federal Energy Regulatory Commission (FERC) issued a proposed policy statement and action plan for standards governing the development of a smart-grid. Successful progress toward national implementation of smart-grids continues.

Upon completion, the new, "internet protocol-based open standards" architecture will replace Duke's existing, antiquated analog electric grid with a long-overdue, secure digital backbone infrastructure.

The resultant smart-grid, widely thought to be replicated by other leading energy utilities, will modernize some the most outdated infrastructure in the U.S. - electricity delivery systems - with secure, reliable and efficient data, networks and communications.

The collaboration project will ultimately update the delivery to, and use of electricity by, Duke's 11 million customers served in five states: Ohio, Indiana, North Carolina, South Carolina and Kentucky. Throughout the term of the project, and in subsequent years, Duke will install large-scale new smart-grid technology, including millions of electric and natural gas "smart meters," in addition to hardware and software for distribution.

"Smart meters" replace analog mechanical meters with digital meters which record energy usage in real-time. Smart meters provide a communications pathway extending from generation plants to electrical outlets and other smart grid-enabled devices.

Manifold benefits await Duke Energy and its customers.

The proposed modernized electric grid will:

• Build an 'Energy Internet', which will enable decentralized power generation, so that customers may be both energy clients and suppliers; allow supplier selection of power consumption to offer flexibility to energy consumers;
• Integrate solar and other renewable energy sources into the electric grid;
• Encourage consumers to actively participate in operations of the grid; improve electricity delivery, improve systems efficiency and reliability, increase energy independence, decrease environmental impact, and help customers reduce their energy consumption, strengthen grid security and resist attack;
• Provide higher quality power that will save money wasted from outages;
• Incorporate two-way digital communication to detect power outages and be readily inter-operable, upgradeable and scalable to new emerging technologies.

Going forward, Cisco plans to continue to deliver products and services to support this initiative serving a growing smart grid communications infrastructure market projected by Cisco to reach $20 billion annually over the next five years.

Duke Energy maintains a Street analyst consensus recommendation with a Buy-rated bias; an average long-term EPS growth rate of 4.2%, within a range of 2.0% to 6.0%, and a target price of $15.48 per share, within a range of $14.00 to $20.00 per share.

Cisco Systems boasts a Street analyst consensus Buy rating with an average estimated long-term EPS growth rate of 10.9, within a range of 2.0% to 20.0% and an average target price of $22.38 per share, within a range of $15.00 to $30.00 per share.

Durable Orders for April increased by 1.9% to $161.5 billion, the second increase in the past three months, following a revised 2.1% decline in March from an originally reported -0.8% change, and was expected to increase by 0.4% over the month.  Factoring in the huge downward revision for March's levels, the level of durable orders in April did not come as strong of a positive surprise considering that much of the increase offset the revision from the previous release.  Over the past 12 months, Durable Orders have dropped by 27.3%.  Excluding transportation, new orders increased by 0.8%, while transportation equipment showed the largest increase, $2.1 billion, by 5.4% to $40.5 billion.

New Home Sales for April increased slightly by 0.3% to an annual pace of 352,000, less than the expected 362,000 annual rate.  Over the year, this figure has plummeted down 34% from the 533,000 pace in April of 2008. The mean price of a new home sold in April increased to $209,700 from $201,400 in March.  Estimated inventory of new houses for sale at the end of April is 297,000 representing a 10.1 month supply at current prices.

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Here are highlights from Thursday's Analyst Blog:

A Green Shoot Starting to Wilt

There are a huge number of obvious sources to cause initial claims to start to rise again. The most notable of these are the effects of the Chrysler bankruptcy and the very high potential for General Motors (GM) to follow. This not only causes layoffs directly at GM, but throughout the country. Just this week, AK Steel (AKS) announced that it was closing a mill in Kentucky which will cause 750 layoffs, and ArcelorMittal (MT) will close a steel plant in Indiana causing 1,000 jobs to be lost.

Even under the out-of-court restructuring plan, GM is going to shut down over 2000 dealers. If you assume 50 people work at each dealership (salesmen, mechanics, etc.) that adds up to 100,000 jobs right there. State and local budgets are also under severe stress, and that may cause very significant layoffs of teachers, firefighters, prison guards and social workers (not to mention even longer waits at the Department of Motor Vehicles).

Yes the stimulus package helped a bit there, but it has only partially filled the hole. The four-week average is a key indicator. Watch it closely, since it could go either way at this point.

Regulation of OTC Derivatives?

The roots of the current problem go back to December 2000 when the Commodity Futures Modernization Act was adopted, which made the derivative instruments largely unregulated. The law came about after heavy lobbying from the bankers on the Wall Street.

The derivatives market which was relatively small then has since exploded and the face value of all derivatives contracts outstanding at the end 2008 totaled more than $680 trillion. In view of the enormous size of the market and the threat these instruments pose to the financial system, their regulation is long overdue.

We anticipate exchanges like CME Group (CME) and Intercontinental Exchange (ICE) to benefit from the new regulations.

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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 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. Subscribe to this free newsletter today: http://at.zacks.com/?id=2677

About Zacks

Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leonard Zacks. As a PhD in mathematics Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which 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 at http://at.zacks.com/?id=4580.

Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.

Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.

Contact:
Mark Vickery
Web Content Editor
312-265-9380
Visit: www.zacks.com

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Here are highlights from Wednesday's Analyst Blog:

Big Day for Semiconductors

Intel Corp. (INTC) has been fined 1.06 billion Euros by the European Commission (EC) for anti-competitive business practices. We have blogged about the suit in the past, and short of the amount (which is historic), it is not a surprise.

The suit alleges Intel gave discounts in exchange for preferential treatment for the manufacturers that used its chips. While the amount of the fine is historic, it will not dent the cash balance of INTC. We would be more concerned about how it affects Intel's market share over the coming quarters.

Applied Materials (AMAT) also released results last night with the top-line beating expectations and the bottom-line meeting them. Guidance was cautious, which was expected.

Entergy Results Disappoint

Entergy Corp. (ETR) released financial results for the 1st quarter of 2009 in which the company reported a 23.8% decrease in earnings of $235.3 million, or $1.20 per diluted share ($1.22 basic), compared to $308.7 million, or $1.56 per diluted share ($1.60 basic), in the year-ago quarter.

Ongoing operating earnings were reported at $252.6 million, or $1.29 per share, compared with $308.7 million, or $1.56 per share, in the comparable prior-year quarter.

Alpha Buying Foundation Coal

Today, Alpha Natural Resources, Inc. (ANR) announced that it would purchase, in an all stock deal, Foundation Coal Holdings, Inc. (FCL) whereby FCL shareholders would receive 1.084 shares of ANR for every share of FCL. Based off of its 5-day moving average of $32.73 per share, this represents a 37% premium over FCL's 5-day moving average.

Alpha will also assume the +$500 MM of Foundation's net debt. The merged company will trade and operate under the Alpha name. The merger effectively gives the new company diversification -- the old ANR was exclusively focused in Central and Northern Appalachia (W. Virginia, Virginia, Kentucky, Pennsylvania), while the majority of Foundation Coal reserves and production come from the Powder River Basin (Wyoming). The reserve diversity will help the new ANR because the old ANR brings a higher margin product -- metallurgical coal -- whereas Foundation Coal produces almost all steam coal, which is used in the electric generation process, and does not experience as much market volatility as metallurgical coal.

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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 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. Subscribe to this free newsletter today: http://at.zacks.com/?id=2677

About Zacks

Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leonard Zacks. As a PhD in mathematics Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which 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 at http://at.zacks.com/?id=4580.

Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.

Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.

Contact:
Mark Vickery
Web Content Editor
312-265-9380
Visit: www.zacks.com

Company Description

Yum Brands is the world's largest restaurant company in terms of system restaurants with more than 35,000 restaurants in more than 110 countries and territories. Four of Yum's restaurant brands, KFC, Long John Silver's, Pizza Hut and Taco Bell, are the global leaders of the chicken, quick-service seafood, pizza and Mexican-style food categories. A&W Restaurants is the longest running quick-service franchise chain in America.

The company, which is based in Louisville, Kentucky, saw more than $10 billion in total revenues in 2007, including company sales and franchise fees.

Growth in the First Quarter

The company recently posted robust results, including first-quarter earnings of 48 cents per share, excluding items. The result topped the year-prior 42 cents and exceeded Street expectations by 20%.

Yum saw worldwide sales growth of 1%, including 2% growth in mainland China, which offset weaker U.S. sales.

Management said the power of Yum's global portfolio allowed the company overcome a challenging environment by accelerating productivity and managing costs while continuing to drive and invest in global growth strategies.

Yum issued a full-year earnings guidance of $2.10 per share, which represents 10% over last year. Analysts are in agreement, pegging 2010 earnings 11% higher at $2.34. The most accurate estimates are higher at $2.11 for 2009 and $2.35 for 2010.

Solid Income

YUM continues reward shareholder with income. The company is a dividend leader among its industry peers, offering an annual dividend of 76 cents per share, which translates into a yield of 2%. YUM nearly quadrupled its quarterly dividend since the initiation of dividends in May 2004. Zacks Investment Research

The Trade Deficit decreased to $26 billion in February from $36.2 billion in January revised from $36 billion, expected to remain steady at $36.1 billion.  February exports were $126.8 billion, $2 billion more than January levels, and February imports were $152.7 billion, $8.2 billion less than January imports.

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Company Description

Headquartered in Waynesboro, VA, NTELOS Holdings Corp. is an integrated communications provider. The company provides products and services to customers in Virginia, West Virginia, Kentucky, Ohio, Tennessee, Maryland and North Carolina, including wireless phone service, local and long distance telephone services, IPTV-based video services as well as data services for internet access and wide area networking.

Higher Forecasts

The company is seeing upbeat forecasts from analysts on solid fourth-quarter and full-year results. The current consensus estimate for 2009 earnings of $1.56 per share is 1% above last month's projection and 11% higher than the level of 2 months ago. The most accurate forecast is higher at $1.64.

Estimates for the first quarter of 40 cents per share are up from last month's 37 cents.

Growth in the Fourth Quarter

The company recently announced fourth-quarter earnings of 15 cents per share, topping the previous year's 10 cents. Operating revenues for the quarter totaled $140.6 million, up from the year-prior $127.9 million.

NTLS noted that one of the highlights for the quarter was its launching or expansion into 6 markets, which led to 70% of total cell sites being upgraded at year-end.

The company also declared a quarterly cash dividend of 26 cents per share, which translates into a robust, industry-leading yield of 5.4%. The dividend is payable April 13 to stockholders of record on March 19.

Favorable Industry Comparisons

NTELOS Holdings offers a return on equity (ROE) of 23%, above the industry average of 13%.

The company earnings per share are expected to grow 12% over the next 3 – 5 years, which is in line with the industry average.

NTELOS Holdings has a net profit margin of 9%, compared to the industry average of 7%. Zacks Investment Research

Company Description

Yum! Brands is the world's largest restaurant company in terms of system restaurants with more than 35,000 restaurants in more than 110 countries and territories. Four of YUM's restaurant brands, KFC, Long John Silver's, Pizza Hut and Taco Bell, are the global leaders of the chicken, quick-service seafood, pizza and Mexican-style food categories. A&W Restaurants is the longest running quick-service franchise chain in America.

The company, which is based in Louisville, Kentucky, saw more than $10 billion in total revenues in 2007, including company sales and franchise fees.

Solid Growth

Yum! Brands posted fourth-quarter earnings of 46 cents per share, beating the previous year's 42 cents and exceeding the consensus estimate by 2%. Worldwide sales jumped 6% year-over-year. Same-store-sales advanced by 3% , the company 21st consecutive quarter of same-store-sales growth.

David C. Novak, Chairman and CEO, said, “I'm very pleased to report 14% EPS growth for the full year 2008, ending the year with impressive 17% operating profit growth in the fourth quarter, both before special items. These results for 2008 again exceeded our annual target for at least 10% EPS growth and represent our seventh straight year of at least 13% growth.

Our China and YRI Divisions, which now account for 60% of operating profit, are a major factor in driving this consistency of performance. 2008 was no exception, as we opened a record 1,495 new restaurants outside the U.S., generated worldwide same-store-sales growth of 3%, and grew worldwide operating profit by 8%.”

Growth Should Continue

Yum! Brands has outpaced the Dow ($DJI), S&P 500 (SPX) and Nasdaq (COMP) over the past year.

Analysts see future earnings growth for YUM, which topped the consensus estimate by an average of 5.4% over the past 4 consecutive quarters.

For 2009, analysts project 9% earnings per share growth. For the following year, analysts are forecasting 16% growth.

In addition to the company's fundamental growth, YUM rewards shareholders with income. The company offers an industry-leading dividend yield of 3%. Zacks Investment Research

Company Description

Headquartered in Waynesboro, VA, NTELOS Holdings Corp. is an integrated communications provider. The company provides products and services to customers in Virginia, West Virginia, Kentucky, Ohio, Tennessee, Maryland and North Carolina, including wireless phone service, local and long distance telephone services, IPTV-based video services as well as data services for internet access and wide area networking.

Growth in the Fourth Quarter

The company recently announced fourth-quarter earnings of 15 cents per share, topping the previous year's 10 cents. Operating revenues for the quarter totaled $140.6 million, up from the year-prior $127.9 million.

NTLS noted that one of the highlights for the quarter was its launching or expansion into 6 markets, which led to 70% of total cell sites being upgraded at year-end.

The company also declared a quarterly cash dividend of 26 cents per share, which translates into a robust, industry-leading yield of 5.4%. The dividend is payable April 13 to stockholders of record on March 19.

Higher Forecasts

Analysts lifted estimates on the strong quarter. The average full-year earnings projection of $1.54 per share was upped from last months $1.52. The most accurate forecast is higher at $1.60.

Estimates for the first quarter edged up a penny to 38 cents per share in just the past week. The most accurate projection of the first quarter is a more bullish 41 cents.

Favorable Industry Comparisons

NTELOS Holdings offers a return on equity (ROE) of 23%, above the industry average of 13%.

The company earnings per share are expected to grow 12% over the next 3 – 5 years, which is in line with the industry average.

NTELOS Holdings has a net profit margin of 9%, compared to the industry average of 7%. Zacks Investment Research

Company Description

Yum! Brands is the world's largest restaurant company in terms of system restaurants with more than 35,000 restaurants in more than 110 countries and territories. Four of YUM's restaurant brands, KFC, Long John Silver's, Pizza Hut and Taco Bell, are the global leaders of the chicken, quick-service seafood, pizza and Mexican-style food categories. A&W Restaurants is the longest running quick-service franchise chain in America.

The company, which is based in Louisville, Kentucky, saw more than $10 billion in total revenues in 2007, including company sales and franchise fees.

Earnings are Expected to Grow

In early December, Yum issued a its outlook on earnings. The company is looking for growth of 12% per share in 2008 and another 10% in 2009 on the back of international expansion, organic sales growth and robust margins.

Analysts see 13% growth in 2008 and 10% for 2009, which translate into earnings per share of $1.90 and $2.08, respectively.

Fourth quarter and year 2008 results are scheduled for release on February 3.

Competitive Income Payouts

The company declared a dividend of 19 cents per share, noting that it will be distributed February 6, 2009, to shareholders of record at the close of business on January 16, 2009.

YUM stated that it has nearly quadrupled its quarterly dividend since the initiation of dividends in May 2004.

The company's dividend yield of 2.7% stands high above the industry average as the majority of YUM's peers pay no dividends.

Robust Growth

The company' third-quarter results included worldwide system-sales growth of 10% and mainland China unit growth of 21%. YUM said its worldwide same-store-sales growth of 3%, marks its 20th consecutive quarter of global same-store-sales growth.

Earnings per share of 58 cents topped the year-prior 50 cents and exceeded the consensus estimate by 7.41%. YUM's earnings per share have been, on average, about .6% ahead of analyst estimates over the past 4 straight quarters.
"YUM" Free Stock Analysis: Buy? Sell? Hold?
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Company Description

Headquartered in Waynesboro, VA, NTELOS Holdings Corp. is an integrated communications provider. The company provides products and services to customers in Virginia, West Virginia, Kentucky, Ohio, Tennessee, Maryland and North Carolina, including wireless phone service, local and long distance telephone services, IPTV-based video services as well as data services for internet access and wide area networking.

Growth in the Third Quarter

In early November, the company announced third-quarter earnings per share of 31 cents, which soared past the year-prior 18 cents and topped the consensus estimate by 7%.

NTLS has a solid track record of exceeding analyst expectations for earnings and outperformed the market for the 2008 year.

Revenues totaled $136 million, growing from last year's level of $127 million.

Management stated that financial results for the third quarter continued to be quite strong, despite overall economic weakness. Chief Executive Officer James S. Quarforth said, “our third quarter consolidated adjusted EBITDA was up 9.5% from third quarter last year and is up 11.2% for the first nine months of 2008.

Favorable Industry Comparisons

NTELOS Holdings Corp. rewards shareholders with a robust dividend yield of 4.4%, while industry peers pay virtually no income.

The company earnings per share are expected to grow 12% over the next 3 – 5 years, versus the industry average projection of 11%.

NTELOS Holdings has a net profit margin of 9%, compared to an industry average that is in the negative.
"NTLS" Free Stock Analysis: Buy? Sell? Hold?
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The company also declared that it will shed 375 jobs as the second-biggest U.S. printer maker struggles to cope with falling demand amid a weak economy.

Shares dropped more than 11% on the news.

The Kentucky-based company forecasted earnings between 71 cents and 76 cents a share, excluding items like job-cut expenses. Analysts are expecting a profit of 81 cents. Lexmark sees a first-quarter profit in the range of 65 cents and 75 cents a share, which excludes restructuring costs.

Lexmark aims to save $50 million a year from the present jobs cuts. The company is expected to meet charges of $45 million with this move.

The company is a Zacks #3 Rank ("Hold").

YUM has an excellent record of exceeding analyst earnings estimates dating back to February 2004. During the most recent 5 consecutive quarters, the company topped forecasts by an average of 6%.
"YUM" Free Stock Analysis: Buy? Sell? Hold?
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The Kentucky-based company reported profit of 94 cents per share, compared to 83 cents a year earlier. It was also in-line with analysts' estimates. Brown-Forman's net sales advanced 5% to $934.7 million.

The manufacturer of Jack Daniel's and Southern Comfort increased its annual earnings forecast. Brown-Forman now expects profit to be in the range of $3.00 to $3.20 per share. Analysts' estimates are at $3.01.

Brown-Forman is a Zacks #3 Rank ("Hold") company.

• American Express Co. (AXP) said yesterday (Thursday) that it plans to cut 7,000 jobs, or 10% of its global work force, in an effort to reduce costs by $1.8 billion in next year, The Associated Press reported. The company will also suspend management-level salary increases next year and institute a hiring freeze. American Express has reported four straight quarters of profit declines.

• Oil prices fell more than 2% yesterday (Thursday), after economic data showed a 0.3% decline in gross domestic product (GDP). Light, sweet crude fell $1.54 at settle $65.96 a barrel, after trading as high as $70.60…

• American Express Co. (AXP) said yesterday (Thursday) that it plans to cut 7,000 jobs, or 10% of its global work force, in an effort to reduce costs by $1.8 billion in next year, The Associated Press reported. The company will also suspend management-level salary increases next year and institute a hiring freeze. American Express has reported four straight quarters of profit declines.

• Oil prices fell more than 2% yesterday (Thursday), after economic data showed a 0.3% decline in gross domestic product (GDP). Light, sweet crude fell $1.54 at settle $65.96 a barrel, after trading as high as $70.60…

This from Today's Financial News:

Although we have heard stories of horrific markets from across the country, the really negative action is coming from just a few localities. Places like southern California, Las Vegas, Miami, and Manhattan have gotten slammed. But the true heart of the nation, places like North Dakota, Kentucky, Delaware, Colorado, Georgia and every other moderate population center, has not seen a huge plunge in its real estate market.

There is no doubt some home prices are about to drop. But will they ever see the 20% or 40% drops making headlines? I doubt it.

In the average American market, a drop of ten percent or more would be an extreme case. Most likely, thanks to mortgage rates hovering just below 6% and thoughts of the Federal Reserve dropping benchmarks even lower, potential buyers will begin to trickle in on any news of price reductions.

To prove that I think we are quite close to the bottom, I put my own money on the line and purchased a house. The asking price on this particular property has dropped by over fifteen percent since it was originally listed over nine months ago.

Like so many other properties on the market, its selling price could not go any lower or the current homeowner would be upside-down on his mortgage. In other words, he would still owe money on it after he sold it.

There are a lot of properties on the market in a similar situation, especially recently built homes. These “over-mortgaged” homes are helping the market keep from making a dramatic and sudden plunge.

Thanks to this phenomenon, the markets may slow to a crawl, but prices will not plunge.

The real estate market is making a lot of headlines and buyers are sitting on the sidelines. The wait may payoff for a few, but for most of America the bottom is so close the risk of missing out on a cheap dream house may not be worth the possible reward of saving a few bucks on your monthly mortgage payment.

Make a realtor happy and start looking for buying opportunities today.

Source: Real estate bottom: Are we there or is a major drop on the way? 

Company Description

Massey Energy Company, which is the fourth largest coal company in the United States based on produced coal revenue, is headquartered in Richmond, Virginia, with operations in West Virginia, Kentucky and Virginia.

Growth Through Mine Acquisition

The company recently announced the acquisition of a metallurgical coal mine in West Virginia. MEE noted that this acquisition can add significant metallurgical coal production almost immediately with relatively low start-up costs.

An Update on the Company's Guidance

In early September, Massey Energy backed its 2008 forecast, noting that it still expects full-year 2008 results, excluding a litigation charge recorded in the second quarter, to be within the ranges of full-year guidance provided previously but with produced tons sold and average price per ton trending toward the lower end of the respective ranges.

Management added that Global demand for coal remains very strong and prices have remained at very high levels. Massey's Chairman and CEO Don Blankenship said, "with continuing progress in our expansion efforts and prices in excess of our original plans, Massey is on track for another record year."

In the company's second-quarter report, which was released in late July, it projected 2008 produced coal shipments to be between 41.5 and 43.0 million tons, with average produced coal realization between $65.00 and $66.00 per ton. MEE said that excluding the WP litigation charge, average cash cost per ton for the full year 2008 is expected to be between $47.00 and $50.00. Other income is expected to be between $20 and $100 million.

More on the Second Quarter

Results for the second quarter included a year-over-year increase of 38% for produced coal revenue and an 8% increase in produced coal tons sold, thanks to the strength of its expanding operations in Central Appalachia. Second-quarter produced coal revenue reached a record $710.3 million, versus the prior-year $516.2 million.

The company's earnings per share totaled $1.15, soaring past 43 the previous year's 43 cents and exceeding the consensus estimate by 42%.

Income

Massey declared a quarterly dividend of 5 cents per share, which is payable on October 14 to shareholders of record on September 30.

Stellar Growth is Expected for MEE

The company's earnings per share are expected to grow by an impressive 40% over the next 3 – 5 years, which is well above the industry average projection of 13%.
"FLR" Free Stock Analysis: Buy? Sell? Hold?
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Company Description

Massey Energy Company, which is the fourth largest coal company in the United States based on produced coal revenue, is headquartered in Richmond, Virginia, with operations in West Virginia, Kentucky and Virginia.

An Update on the Company’s Guidance

Massey Energy recently backed its 2008 forecast, noting that it still expects full-year 2008 results, excluding a litigation charge recorded in the second quarter, to be within the ranges of full-year guidance provided previously but with produced tons sold and average price per ton trending toward the lower end of the respective ranges.

Management added that Global demand for coal remains very strong and prices have remained at very high levels. Massey's Chairman and CEO Don Blankenship said, "with continuing progress in our expansion efforts and prices in excess of our original plans, Massey is on track for another record year."

In the company’s second-quarter report, which was released in late July, it projected 2008 produced coal shipments to be between 41.5 and 43.0 million tons, with average produced coal realization between $65.00 and $66.00 per ton. MEE said that excluding the WP litigation charge, average cash cost per ton for the full year 2008 is expected to be between $47.00 and $50.00. Other income is expected to be between $20 and $100 million.

More on the Second Quarter

Results for the second quarter included a year-over-year increase of 38% for produced coal revenue and an 8% increase in produced coal tons sold, thanks to the strength of its expanding operations in Central Appalachia. Second-quarter produced coal revenue reached a record $710.3 million, versus the prior-year $516.2 million.

The company’s earnings per share totaled $1.15, soaring past 43 the previous year’s 43 cents and exceeding the consensus estimate by 42%.

Income

Massey recently declared a quarterly dividend of 5 cents per share, which is payable on October 14 to shareholders of record on September 30.

Stellar Growth is Expected for MEE

The company’s earnings per share are expected to grow by an impressive 40% over the next 3 – 5 years, which is well above the industry average projection of 11%.
"FLR" Free Stock Analysis: Buy? Sell? Hold?
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Almost Family, Inc. provides home health care services in various states throughout the United States. The company operates in two segments, visiting nurse and personal care. The company was founded in 1985, has a market cap. of $206 million and is headquartered in Louisville, Kentucky.

A Great Quarter

Almost Family's share price has been on an intense rally for the last two months, and after the company reported record setting second-quarter results on August 6, it was obvious why.

Net services revenue increased 50% from last year to $48.7 million. Net income surged to $3.9 million, up from $2 million in the same period last year, a 95% gain. This produced earnings of 50 cents per share, blowing past analyst estimates of 38 cents per share. The company noted that it was able to achieve these impressive earnings results in spite of issuing an additional 2,512,500 shares.

Almost Family has continued to experience exceptional growth from its visiting nurse segment, which posted a 66% increase in revenue from last year to $38.9 million.

A History of Surprising

This was the fourth time in four quarters that AFAM has either matched or beaten analyst estimates, having done so by an average of 8 cents, or 22%.

Almost Family noted during its press conference that it had recently been added to the Russell 2000 Index and had been named one of Fortune Small Business' 100 fastest-growing small public companies.

Analyst Estimates

Almost Family's share price has been advancing in tandem with analyst earnings estimates. The current-year estimate now stands at $1.88 per share, up from $1.42 per share 90 days ago and up from $1.51 30 days ago. The next-year estimate is bullish, projecting earnings of $2.23 per share, a 19% jump from this year.

The Chart

As previously mentioned, shares of AFAM have been on a big rally since early June, climbing to the recent high above $41 from just below $23. More recently, shares have once again begun to advance and are now pressuring the 52-week and all-time high. Take a look at the chart below.

"SENR" Free Stock Analysis: Buy? Sell? Hold?
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