Chicago, IL – March 19, 2010 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Wal-Mart (WMT), Kimberly-Clark (KMB), Procter & Gamble (PG), Bristol-Myers Squibb Company (BMY) and AstraZeneca Plc (AZN).

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Here are highlights from Thursday’s Analyst Blog:

Initial Jobless Claims Down Again

Extended claims are very helpful from a humanitarian point of view at a time when there are five job seekers for every job opening. By the time people have been out of work for six months, it is highly likely that they have already drawn down their savings and run up their credit cards. That probably includes drawing on 401-k accounts. When people do that, the money withdrawn is taxable, and they have to pay a 10% penalty.

With one out of four homeowners with mortgages now underwater and millions more extremely close to “sea level," the option of drawing on home equity is not open the way it had been in previous downturns. Thus without a paycheck, these people are left with no financial resources at all. That is clearly a severe hardship on the families involved.

However, it is also very bad news for the economy overall. The money from extended benefits tends to get spent quickly and spent on basic necessities. This means they can buy their groceries and other basic goods at Wal-Mart (WMT) instead of having to rely on already overstretched food banks. That helps keep people working at Wal-Mart. If they spend the money on toilet paper, it helps keep people working at Kimberly-Clark (KMB) or Procter & Gamble (PG).

Those people who are kept working in turn go out and spend money and keep other people working. In fact, the non-partisan Congressional Budget Office (CBO) finds that, dollar for dollar, extended claims is among the most effective form of fiscal stimulus in keeping of creating jobs.

Boost for Bristol-Myers

Recently, Bristol-Myers Squibb Company (BMY) and AstraZeneca Plc (AZN) announced that the U.S. Food and Drug Administration (FDA) has accepted their application for reviewing the combination of a fixed dose of Onglyza (saxagliptin) and metformin for treating patients suffering from type II diabetes. While Onglyza is already available for the treatment of diabetes, metformin is a widely-used generic diabetes pill.

Onglyza is co-developed by Bristol-Myers and AstraZeneca. The partners submitted a New Drug Application (NDA) to the U.S. regulatory authority for saxagliptin/metformin HCl extended-release tablets on Dec 29, 2009.

The NDA is based on bioequivalence data and data from the Onglyza late-stage clinical trial program. The data included studies on the co-administration of Onglyza and immediate release metformin, as an adjunct to diet and exercise, in adult patients suffering from type II diabetes. The subjects in the program were either treatment-naïve or their disease was inadequately controlled by metformin alone.

As a reminder, Onglyza, a dipeptidyl peptidase-4 (DPP IV) inhibitor, contributed approximately $4 million to sales in the most recent quarter (ended Dec 31, 2009). The drug has been submitted to regulatory authorities in more than 50 countries, and is approved in 38 countries and launched in the United States (the FDA approved Onglyza in July 2009), Canada , Mexico , Germany , UK and Denmark.

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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.

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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=5518.

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ATP’s other deepwater development, Canyon Express Hub, was commissioned for initial production on Mar 11, 2010 at the rate of 30 million cubic feet per day (MMcf/d) gross.
 
Year-End Proved Reserves
 
As of year-end 2009, ATP had 135.2 million barrels of oil equivalent (MMBOE) in proved reserves, of which roughly 58% was oil and condensate. The company’s 2009 year-end proved reserves tally was 14% above the year-earlier level, while achieving a reserve replacement ratio of 376%.
 
Guidance
 
The company said that it expects first quarter 2010 production to be approximately 1,500 MBOE. For 2010, ATP guided towards a capital investment program of $570 million.
 
Company Overview
 
ATP Oil & Gas is engaged in the acquisition, development and production of natural gas and oil properties in the Gulf of Mexico and the North Sea. The company concentrates its efforts on natural gas and oil properties with proved undeveloped reserves that are economically attractive but are not strategic to larger or exploration-oriented independent oil and gas companies.
 

Chicago, IL – March 18, 2010 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Freeport McMoRan (FCX), Petrobras (PBR), EnCana (ECA), ATP Oil and Gas (ATPG) and Discover Financial Services (DFS).

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Here are highlights from Wednesday’s Analyst Blog:

PPI Falls More Than Expected

It is worth noting that this fits with what we saw in the Capacity Utilization report that came out on Monday. In February, crude good production facilities were operating at 86.2% of capacity, which is roughly in line with the long term historic average of 86.5% of capacity.

Plants that produce intermediate goods were running at just 69.6% of capacity, far below the long-term average rates of 81.6%. Factories that produce finished goods were more or less in the same boat as the intermediate facilities, operating at just 70.8% of capacity, which is well below the long-term average rate of 77.5%.

With operating rates so low, the producers of those goods do not have the leverage to be able to pass through the higher crude goods prices. This would seem to indicate that producers of crude goods, like copper miner Freeport McMoRan (FCX) and oil and gas E&P firms, should be better positioned than firms closer to making the final consumer products.

When looking for E&P companies, look for those that are well positioned to increase their production over the next few years. Some of those that look interesting to me include Petrobras (PBR) with its giant offshore fields, EnCana (ECA), which is ramping up natural gas production from the shale plays, and for those of you looking for a smaller cap name that will really be increasing production this year, ATP Oil and Gas (ATPG) is where a new project in the Gulf of Mexico is coming on line and should more than double production this year.

Discover Posts Loss, Will Repay TARP

Discover Financial Services (DFS) reported a fiscal first quarter loss as the company bolstered its loan loss reserves. However, the company has received the regulatory approval to payback the $1.2 billion bailout money.

For the fiscal first quarter (ended Feb 28, 2010), Discover reported a loss of $104 million or 22 cents a share. The figure includes a pre-tax addition to loan loss reserves of $305 million ($185 million after tax). This brings its reserve coverage to approximately a year of losses. This compares with the Zacks Consensus Estimate of earnings of 4 cents.

The company reported a profit of $120 million or 25 cents per share in the prior-year period. However, that result included an approximate $297 million after-tax gain related to the Visa/MasterCard antitrust litigation settlement.

Discover’s banking unit, Discover Bank, will offer $350 million in the form of subordinated debt prior to the redemption of the $1.2 billion of preferred stock it issued to the U.S. Treasury under the TARP Capital Purchase Program. The offering is expected to be completed during the second quarter. The company does not expect to make any equity raise for the repayment.

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The decline in net loss per share was primarily due to an increase in the number of shares. Total net loss increased to $13.95 million during the reported quarter compared to $11.08 million in the year ago period.

Novavax, a vaccine developer, does not have any marketed products at present. A 34.8% increase in operating expenses led to the increased loss for the company. With the progress made by the company in the development process of its vaccines, research and development (R&D) expenses increased 87% year-over-year to $10.96 million.

Year 2009 has been quite significant for Novavax. In Sep 2009, the company made a major breakthrough in a phase II clinical trial of its trivalent seasonal influenza virus-like particle (VLP) vaccine candidate.

While the trial carried out on 221 people (aged 18 to 49 years) showed strong immune system responses against three flu strains (H3N2, H1N1, and B), no major adverse events were reported. The company expects to begin a phase III study this year.

Novavax has launched a large clinical study for its H1N1 vaccine in Mexico in collaboration with Avimex Laboratories and GE Healthcare. Final results from this study are expected in 2010. If the results are encouraging, the company expects to get the vaccine approved in Mexico.

Novavax has also identified a vaccine candidate for the prevention of respiratory syncytial virus (RSV). The company plans to complete preparations for its Investigational New Drug (IND) filing for the vaccine in 2010.

Spurred by the advancement of several of its clinical development programs, Novavax raised $45 million from equity offerings. The company exited 2009 with $43 million in cash, cash equivalents and short-term investments, up from $33.9 at the end of 2008. We are pleased to note that Novavax has retired $22 million of convertible debt.
 

Chicago, IL – March 15, 2010 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Goldcorp (GG), Barrick Gold Corporation (ABX), Kinross Gold Corporation (KGC), Yamana Gold Inc. (AUY) and GOL Linhas Aéreas Inteligentes S.A. (GOL).

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Here are highlights from Friday’s Analyst Blog:

Goldcorp Adjusts Q4 Profits Up

Gold mining company Goldcorp’s (GG) adjusted net profits more than doubled to 25 cents in the fourth quarter of 2009 from 12 cents per share in the year-ago period. Earnings which benefited from high metal prices, were also ahead of the Zacks Consensus Estimate of 24 cents.

For the full year 2009, earnings were $588.2 million or $0.80 per share. Goldcorp was able to keep costs down in an inflationary environment. In the fourth quarter, cash costs were just US$289 an ounce.

The Vancouver-based gold company also managed to keep its development projects on-time and on-budget. Goldcorp, which recently acquired exploration firm Canplats Resources, as well as 70% of the El Morro copper-gold deposit in Chile, expects to produce 2.6 million ounces of gold this year. Goldcorp completed two projects in 2009: the Camino Rojo project near Peñasquito and the El Morro project.

Goldcorp reported that the new Peñasquito mine in Mexico is expected to start commercial production in the third quarter of 2010. Production at the Éléonore project in Quebec is anticipated at around 330,000 ounces of gold a year over a 16-year mine life, with cash costs below $400 an ounce. The initial capital cost of the project is expected to be about $800 million.

Goldcorp is North America's lowest-cost gold producer. The company owns and operates the Red Lake, Porcupine and Musselwhite gold mines in Canada. Goldcorp has one of the best production profiles in the industry and competes with major gold producers like Barrick Gold Corporation (ABX), Kinross Gold Corporation (KGC) and Yamana Gold Inc. (AUY).

Goldcorp is developing new mines to be beneficial in times of higher gold prices. However, the company is exposed to foreign exchange risk as it pays most costs in local currencies and sells metal in dollars, hurting profits when currencies such as the Mexican peso and Canadian dollar rise, in spite of the company selling more gold at higher prices. We maintain our Neutral recommendation on the stock.

GOL Soars Past Estimates

GOL Linhas Aéreas Inteligentes S.A. (GOL) reported results for the fourth quarter of 2009. During the quarter, net revenues were R$1,617.6 million, up from R$1,548.6 million in the year-ago quarter.

During the quarter, GOL posted operating income of R$119.2 million, with an operating margin of 7.4%, 121.2% up from R$53.9 million and 3.5% margin in the year-ago quarter.

The improvement is a result of the company's competitive advantages in relation to greater flight frequency between domestic airports, low-cost leader, and high indicators of punctuality, regularity, safety and differentiated client service, as well as increased demand on the domestic and international markets.

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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.

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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=5518.

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Revenues

Net sales for the quarter declined 13.8% year-over-year to $2.9 billion, attributable to declines in three of the five operating segments of the company. The Pork segment contracted 15.1%, Packaged Meat declined 18.3% while the Other segment declined 0.7%. These were partially offset by increases in the International segment (+3.0%) and Hog Production (+4.7%).

Segments

Net sales in the Pork segment declined as fresh pork operating margins were lower compared to the year ago quarter, due to reduction in hog slaughter levels that negatively impacted results. Furthermore, fresh pork volumes in the third quarter declined 7% year-over-year.

Export volume in the third quarter were also flat compared to the same period last year, despite closed export markets in China and Russia, both of which are important markets for U.S. pork.

Revenues in the packaged meats segment also declined year-over-year due to planned volume decreases. This was the result of plant closures in the Pork group restructuring plan.

The International segment witnessed revenue growth driven by strong performance in Poland and brand growth as sales volumes increased 24%. Revenue growth in Hog Production was driven by a 12% improvement in live hog market prices in the U.S. and a 16% reduction in domestic raising costs.

Live hog market prices in the U.S. increased to an average of $44 per hundredweight compared to $40 per hundredweight in the year-ago period. Domestic raising costs decreased to $51 per hundredweight from $61 per hundredweight in the prior year. Furthermore, the company's international hog production operations in Poland, Romania and Mexico also delivered strong performance.

Revenues in Other segment contracted marginally year-over-year attributable to previous year’s sell-off of the company's live cattle operations. This was partially offset by improvements in live turkey
pricing.

Margins

Gross margin for the quarter expanded 733 basis points (bps) to 9.9% versus 2.5% in the comparable prior-year quarter. During the quarter, the company reported an operating profit of $96.5 million, compared to a loss of $135.5 million in the prior-year quarter.

Guidance

Concurrent with the earnings release, management provided outlook for fiscal 2010. The company anticipates that fresh pork margins will improve as hog slaughter levels continue to decline and the Sioux City plant is closed in April.

For fiscal 2011, management expects hog production to increase dramatically year-over-year. In addition, pork segment is also expected to deliver a strong performance, owing to the restructuring plan that will be complete.

For the full year 2009, earnings were $588.2 million or $0.80 per share. Goldcorp was able to keep costs down in an inflationary environment. In the fourth quarter, cash costs were just US$289 an ounce.

On a GAAP basis, fourth-quarter profit fell to $66.7 million or 9 cents a share, from $958.1 million, or $1.31 a share. The large drop was due to revaluation of future income tax liabilities, brought about by the sharp year-on-year drop in the U.S. dollar.

Quarterly revenues jumped 28% to $778.3 million, as prices of the gold, copper and silver rose sharply after the price crash of late 2008. The company sold 573,100 ounces of gold in the quarter.

For the full year, revenues increased by 13% over 2008 to $2.7 billion on gold sales of 2.3 million ounces. Earnings from operations were up 21% year over year to $241 million.

Golcorp produced 601,300 ounces of gold at a total cash cost of $289 per ounce for the quarter ended December 31, 2009. For the year, the company produced 2.42 million ounces of gold at a total cash cost of $295 per ounce.

Operating cash flows, before working capital changes, totaled $1.2 billion, or $1.61 per share, a 29% increase over 2008. Long-term debt as of Sep 30, 2009 was $719 million, considerably higher than $5.3 million as of Dec. 31, 2008. Goldcorp embarked upon external sources to finance its capital expenditure. However, with cash and cash equivalents of $874.6 million as of December 31, 2009, higher debt should not be a major concern for Goldcorp.
 
Project Update

The Vancouver-based gold company also managed to keep its development projects on-time and on-budget. Goldcorp, which recently acquired exploration firm Canplats Resources, as well as 70% of the El Morro copper-gold deposit in Chile, expects to produce 2.6 million ounces of gold this year. Goldcorp completed two projects in 2009: the Camino Rojo project near Peñasquito and the El Morro project.

Goldcorp reported that the new Peñasquito mine in Mexico is expected to start commercial production in the third quarter of 2010. Production at the Éléonore project in Quebec is anticipated at around 330,000 ounces of gold a year over a 16-year mine life, with cash costs below $400 an ounce. The initial capital cost of the project is expected to be about $800 million.

Goldcorp is North America's lowest-cost gold producer. The company owns and operates the Red Lake, Porcupine and Musselwhite gold mines in Canada. Goldcorp has one of the best production profiles in the industry and competes with major gold producers like Barrick Gold Corporation (ABX), Kinross Gold Corporation (KGC) and Yamana Gold Inc. (AUY).
 
Goldcorp is developing new mines to be beneficial in times of higher gold prices. However, the company is exposed to foreign exchange risk as it pays most costs in local currencies and sells metal in dollars, hurting profits when currencies such as the Mexican peso and Canadian dollar rise, in spite of the company selling more gold at higher prices. We maintain our Neutral recommendation on the stock.

The pension funds of Mexico have been recently deregulated to allow the Afores to invest broadly in private equity. Besides providing a capital injection to roads, ports and other big infrastructure projects, the deregulation also enables Afores to be more flexible to better manage stock and debt holdings during times of high volatility.

AMB is a leading industrial real estate company, with a strong portfolio of warehouses and distribution facilities in some of the busiest distribution markets in the world. The company’s properties are located in supply-constrained infill markets at close proximity to airports, seaports and ground transportation facilities, which enable the swift distribution of customers’ products.

AMB has two lines of businesses: real estate operations, which involve the long-term ownership and operations of industrial properties; and private capital, which provide portfolio management and reporting services to joint venture partners. The company earns acquisition, development and asset management fees in addition to priority distributions and promoted interest from the private capital business.

Company Description

Cardtronics operates over 30,000 ATMs in the U.S., Puerto Rico, the U.K. and Mexico. Additionally, the company works with merchants like 7-Eleven, Costco, CVS, and other major retailers and gas stations.

Rising Revenue

On Feb 11 Cardtronics reported fourth-quarter results that included revenue of $125 million, up 6% since the same period last year. The company also managed to improve its gross margin by 700 bps, to 31%.

Net income came in at just under $7 million, or 17 cents per share. This did fall a penny shy of expectations.

Chairman - "Outstanding Year"

Fred Lummis, Chairman of the Board said "2009 was truly an outstanding year for Cardtronics." He went on to highlight the record revenue and cash flows, that allowed the company to lower its debt ratios, strengthening the balance sheet.

Solid Growth

After the report, most Cardtronics analysts raised full-year estimates. The Zacks Consensus Estimate for 2010 is up a penny to 77 cents. If met, this would be a growth rate of 40%.

Next year's projection is also up 1 penny, to 95 cents for a growth rate of 13%.

Valuations

Cardtronics has nice growth projections but remains a good value too. The forward P/E is less than 13 times and shares carry a PEG ratio of 0.9. CATM's price-to-sales ratio is 0.8 times.

The Chart

The earnings miss sent shares sharply lower, but if you are looking to do some bottom fishing this Zacks Rank #1 stock is a solid candidate. The decline gives Cardtronics great value and the chart looks to be leveling off.

Bill Wilton is the Growth Stock Strategist for Zacks.com. He is also the Editor in charge of the market-beating Zacks Growth Trader serviceZacks Investment Research

Net sales in the quarter rose 4% to $1.5 billion. Domestic same store sales (sales for stores open at least one year) increased 1% for the quarter. Gross profit, as a percentage of sales, went up to 50% from 49.7% in the last year's quarter. The improvement in gross margin was attributable to a shift in mix of sales to higher margin product and lower product acquisition costs.

AutoZone’s inventory increased 3.3% due to the new store openings. Inventory per store was $504 thousand versus $509 thousand last year. However, net inventory (merchandise inventories less accounts payable) decreased on a per store basis to $26,000 from $50,000 last year.

During the quarter, AutoZone opened 24 new stores in the U.S. and 9 new stores in Mexico. As of February 13, 2010, the company had 4,289 stores in 48 U.S. states, the District of Columbia and Puerto Rico, and 202 stores in Mexico.

Under its share repurchase program, AutoZone repurchased 565,000 shares of its common stock for $88 million during the quarter, at an average price of $155 per share. The company has $517 million remaining under its current share repurchase authorization.

AutoZone had cash and cash equivalents of $105 million as of February 13, 2009. Total debt amounted to $2.77 billion as on that date. The company had a stockholder deficit of $422 million as of the above period. In the quarter, the company had a net cash flow of $78 million before share repurchases and changes in debt.

Estimate Revisions Trend

Over the last 30 days, out of the 26 analysts covering the stock, 6 analysts have upwardly revised estimates for full year 2010, while only one analyst has revised it downward. In the absence of any upward or downward revision of estimate from a majority of analysts, our long-term recommendation on the stock remains Neutral (Zacks #3 Rank).

With respect to earnings surprises, the stock has performed moderately well over the trailing four quarters. Its average earnings surprise was 5.23% over that time period.

The current Zacks Consensus Estimates for the third quarter and full-year 2010 are profits of $3.51 per share and $13.64 per share, respectively. The upside potential of these estimates, essentially a proxy for future earnings surprises, currently stands at plus 0.86% and minus 0.22%, respectively.

Based on the improved results, AutoZone’s stock price escalated about 1.3% to over $168 per share just after mid-day trading.

Fourth-quarter revenues grew 10.6% to $8,790 million. Revenues were positively impacted by foreign exchange (FX) fluctuations (2.4%). Full-year revenues were $30.8 billion, up 4.2%.

All the revenue segments at Abbott recorded year-over-year growth in the fourth quarter of 2009. While Pharmaceutical division revenues increased 5.2%, Nutritional sales increased 8.8%. Diagnostics and Vascular division sales grew 8.8% and 9.1%, respectively.

2010 Guidance Exceeds Expectations

Management provided better-than-expected guidance for 2010. With pharma peers like Johnson & Johnson (JNJ) and Pfizer (PFE) guiding towards single-digit bottom-line growth in 2010, Abbott's earnings guidance of $4.20 to $4.25, representing double-digit growth, is impressive.

Abbott expects strong double-digit revenue growth in 2010, including a favorable foreign exchange impact in the range of 1-2%. The Solvay acquisition should boost total revenues by $3 billion. Meanwhile, key products like Humira and Niaspan should continue contributing significantly to revenues.

While Niaspan should continue benefiting from the favorable Arbiter-6 HALTS data, Humira should benefit from launches in new territories, approval in Japan for Crohn's disease and ankylosing spondylitis and in China for rheumatoid arthritis. We expect Humira to continue growing although at a slower rate. Abbott expects Humira to grow 20% in 2010.

We also expect XIENCE V to continue performing well thanks to recent approvals in countries like Japan, China and Mexico. Japan is the second largest drug-eluting stent market in the world and represents a $500 million - $600 million market opportunity.

Meanwhile, Abbott expects full-year 2010 gross margins to improve to 59.5%, mainly due to an improved product mix and efficiency initiatives, as well as the addition of Solvay. While SG&A spending is expected to increase to more than 27% of sales, R&D expenses are expected at 9.5% of sales.

Estimate Revisions Trend

Based on the company's performance and 2010 guidance, several analysts following the stock have revised their estimates for the company. Over the past 30 days, thirteen of the 20 analysts following the stock have raised their earnings estimates for fiscal 2010 with only 2 analysts moving in the opposite direction.

On balance, 2010 estimates are up 5 cents with the current Zacks Consensus Estimate being $4.24, towards the upper end of the guidance issued by the company. Considering Abbott's previous track record, we believe the company is well-positioned to achieve its guidance. Abbott has consistently met or exceeded its guidance.

We believe that the recent acquisition of Solvay, continued double-digit growth from Humira, strong contributions from the lipid franchise, solid performance of the vascular and diagnostics divisions and new product launches should help Abbott achieve its guidance.

The Solvay acquisition should strengthen Abbott's presence in key emerging markets, where Abbott intends to double its revenues by 2013.

Earnings are also on the rise for fiscal 2011 with 7 of the analysts following the stock raising their estimates over the last 30 days. Only 1 analyst moved in the opposite direction during this time-period. On balance, 2011 earnings estimates have gone up by 9 cents with the current Zacks Consensus Estimate being $4.74.

Meanwhile, we note that 10 of the 15 analysts covering the stock have reduced their earnings estimates for the first quarter of fiscal 2010 over the past 30 days. The downward revision is not surprising as the company provided first quarter guidance that was below expectations.

Abbott is guiding towards first-quarter earnings in the range of 79 – 81 cents per share on strong double-digit revenue growth. Despite forecasting strong top-line growth, Abbott expects bottom-line growth to be affected by lower "other income" from its previous joint venture with Takeda.

On balance, earnings estimates for the first quarter are down by 5 cents with the current Zacks Consensus Estimate standing at 81 cents, towards the upper end of the company's guidance, with no upside potential.

Earnings growth should pick up as the year progresses. We note that Abbott usually starts the year by providing conservative guidance, which is revised upwards as the year progresses.

Earnings estimates for the second quarter of 2010 are up by a couple of cents with 6 of the 15 analysts covering the stock raising their estimates over the past 30 days. Five analysts moved in the opposite direction during this period. If second-quarter results come in-line with the Zacks Consensus Estimate of $1.03, earnings would be up 15.7% from the year-ago period.

In terms of earnings surprises, earnings exceeded the Zacks Consensus Estimate in each of the last four quarters, with a four-quarter average of 2.12%. This means that on average, earnings beat the Zacks Consensus Estimate by 2.12%.

Our Recommendation

We currently have a Neutral recommendation on Abbott, which is supported by the Zacks #3 Rank. Although economic weakness, generic competition for Depakote and foreign exchange headwinds slowed down top-line growth in 2009, we believe Abbott is weathering the storm relatively well.

Abbott's strong business segments, contributions from recent acquisitions and impressive late-stage pipeline should help fortify long-term earnings growth. Humira should remain a significant growth driver, though increasing competition remains a matter of concern.

Chicago, IL – February 26, 2010 – Zacks Equity Research highlights Universal Technical (UTI) as the Bull of the Day and Northern Trust (NTRS) the Bear of the Day. In addition, Zacks Equity Research provides analysis on Dr Pepper Snapple Group Inc. (DPS), Safeway Inc.(SWY) and Mylan (MYL).

Full analysis of all these stocks is available at http://at.zacks.com/?id=5506

Here is a synopsis of all five stocks:

Bull of the Day:

Universal Technical’s (UTI) leading position in providing technical education to aspiring automotive professionals, and its business model of working closely with leading OEMs provide the company a competitive advantage.

The company's sustained effort to expand educational programs helps it to boost enrollments, and in turn, the top-line. Moreover, higher education sees a counter-cyclical movement during sluggish economic conditions.

Furthermore, the company's debt-free balance sheet, and healthy cash reserves augur well for future operating performance. Our current target price is $28 per share.

Bear of the Day:

We are downgrading our recommendation on Northern Trust (NTRS) to Underperform from Neutral. The company's fourth quarter earnings came in better than the Zacks Consensus Estimate, benefiting primarily from lower provisions.

The low interest rate environment is reducing the profitability of the company's balance sheet as earning asset yields are contracting faster than its cost of funds. We expect its net interest income, securities lending revenue and money market fees to remain under pressure until interest rates rise.

Also, credit quality remains a concern. However, with a growing network of clients, the company is poised to benefit from changing demographic trends. Moreover, adequate financial strength positions it for suitable acquisitions.

Latest Posts on the Zacks Analyst Blog:

Dr Pepper Beats Estimates

Dr Pepper Snapple Group Inc. (DPS) reported strong fourth-quarter 2009 earnings of 44 cents per share. Earnings were 4 cents above the Zacks Consensus Estimate and were up compared to a loss of $2.44 per share in the prior-year period.

Net sales declined 1.5% year-over-year to $1.3 billion, as concentrate price increases taken earlier in the year, combined with 4% growth in sales volume, were fully offset by the loss of certain contract manufacturing and negative mix from higher sales of carbonated soft drink (CSD) concentrates and value juices.

Bottler case sales volume increased 4% during the quarter with carbonated soft drinks growing 4% and non-carbonated beverage sales up 5%. On a geographic basis, volume sales increased 4% in North America and Canada, and 1% in Mexico and the Caribbean.

Safeway Reports In-line

Safeway Inc. (SWY) reported fourth quarter earnings of 53 cents per share, meeting the Zacks Consensus Estimate. However, earnings were down 33% from 79 cents in the prior-year period.

After considering a goodwill impairment charge, the company had a loss of $4.06 per share during the reported quarter. For the full year 2009, Safeway’s earnings came in at $1.74 compared to $2.21 in 2008.

Safeway recorded a year-over-year decline of 8.1% in sales to $12.7 billion in the quarter primarily due to a 4.1% decline in identical-store sales (excluding fuel) and an additional week in the fourth quarter of 2008. Revenues for 2009 declined 7.4% to $40.8 billion.

Due to a lower market capitalization and a weak economy, Safeway recorded a non-cash goodwill impairment charge of $1,974.2 million ($1,818.2 million, net of tax) during the reported quarter. Gross margin of 28.64% for the quarter was 14 basis points lower than the previous year. However, the gross margin declined 16 basis points, excluding the impact of fuel sales.

Mylan Beats, Outlook Robust

Mylan (MYL) reported fourth quarter earnings per share (EPS) of 33 cents, surpassing the Zacks Consensus Estimate of 30 cents and 26 cents in the prior-year period. For the full year 2009, EPS came in at $1.30, up 62.5% from 80 cents in 2008.

Mylan reported revenues of $1.35 billion, a 12% increase compared to $1.20 billion in the year-ago period. Revenues were favorably impacted by the foreign currency translation. For the full year, the company recorded $5.09 billion in sales, marginally lower than $5.14 billion in the previous year, which included $468.1 million of previously deferred revenue related to its sale of Bystolic rights.

From the third quarter of 2009, Mylan has decided to report its results in two segments -- Generics and Specialty -- following the acquisition of approximately 24% of the remaining interest in Matrix and the related de-listing. The former Matrix segment is included in the Generics segment.

While revenues from the Generics Segment increased 14% year-over-year to $1.29 billion during the quarter, revenues from Specialty have recorded an increase of 8% to $87.5 million.

Get the full analysis of all these stocks by going to http://at.zacks.com/?id=5507.

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. Subscribe to this free newsletter today by visiting http://at.zacks.com/?id=5508.

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=5509.

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Net sales declined 1.5% year-over-year to $1.3 billion, as concentrate price increases taken earlier in the year, combined with 4% growth in sales volume, were fully offset by the loss of certain contract manufacturing and negative mix from higher sales of carbonated soft drink (CSD) concentrates and value juices.

Bottler case sales volume increased 4% during the quarter with carbonated soft drinks growing 4% and non-carbonated beverage sales up 5%. On a geographic basis, volume sales increased 4% in North America and Canada, and 1% in Mexico and the Caribbean.

Net sales of Beverage Concentrates increased 6% during the quarter due to extensive distribution of the Crush brand, strong concentrate sales to third-party bottlers ahead of the January 2010 price increase and mid-single-digit price increases taken at the beginning of the year. Segment operating profit declined 4%.

In the Packaged Beverages segment, net sales decreased 2% due the loss of certain contract manufacturing. However, segment operating profit increased 40% due to lower packaging and transportation costs and continued operating efficiencies, partially offset by higher marketing investments, SAP upgrade costs and other expenses.

During the quarter, Dr Pepper reported a 10% increase in sales volume growth in Latin America Beverages. The segment operating profit increased a robust 86% in the quarter largely due to lower packaging, ingredient and transportation costs.

Gross margin for the quarter expanded 627 basis points (bps) to 61.1% versus 54.8% in the comparable prior-year quarter. The company reported an operating profit of $251 million compared to a loss of $836 million in the prior-year quarter.

Dr Pepper generated $865 million of cash from operating activities with a capital expenditure of $312 million. During the first nine months of 2009, the company also repaid $550 million of debt.

Based on the performance in the fourth quarter and full fiscal 2009, management provided its outlook for fiscal 2010. The company expects full-year net sales to increase in the range of 3% to 5%. Annual earnings are expected to be in the range of $2.27 to $2.35 per share.

Packaging and ingredient costs are expected to increase in the range of 1% and 2%. The company expects total average debt obligations to be approximately 5%. Capital expenditures are expected at approximately 5% of net sales.

The exchange-traded fund industry loves the fact that Harvard’s endowment holds large positions in ETFs. Scroll around the Web enough and you’ll come across a story noting that “9 of Harvard’s 10 largest positions” are in ETFs.

Those statements stretch the truth. They are based on the 13-F filings that Harvard (and all other institutional investors) must make periodically with the Securities and Exchange Commission disclosing their positions in publicly traded securities.

That last caveat is important, because the vast majority of Harvard’s $30+ billion is tied up in private placements and private investments.

Still, it is true: According to the latest 13-F filing, which hit the SEC this week, nine of Harvard’s 10 largest positions are in ETFs. (The tenth, for the record, is Spider-Man producer Marvel Entertainment (NYSE: MVL).)

It’s not chump change, either. All told, Harvard has $1.66 billion invested in ETFs, mostly in iShares. The table below details all of Harvard’s ETF positions as of its recent SEC filing.

A few things stand out here, besides the heavy iShares focus.

First, Harvard clearly considers ETFs a tool for accessing emerging markets. There are no currency, commodity or U.S. equity funds here. The only mainline developed markets fund is the iShares MSCI Japan ETF (NYSEArca: EWJ), where Harvard has a whopping $993 invested.

Second, as big as it is, while Harvard holds just 0.2 percent of total ETF industry assets, it has huge stakes in a number of individual funds. The endowment owns 19 percent of the iShares MSCI South Africa ETF (NYSEArca: EZA), for instance.

And net-net, Harvard is coughing up more than $11 million in fees for the privilege of owning these ETFs. That probably keeps a few iShares workers employed.

Third, I’m intrigued to see that Harvard owns an ETN: $108 million worth of the iPath India ETN (NYSEArca: INP). That ETN has had a few problems, occasionally halting the issuance of new shares and trading at a premium as a result. But Harvard, with a long-term planning window, presumably feels this is not an issue.

Finally, I’m intrigued by the areas where Harvard owns competing funds. It has a $388 million position in the iShares MSCI Emerging Markets ETF (NYSEArca: EEM), for instance, but also owns a $17 million position in its direct competitor, the Vanguard Emerging Markets ETF (NYSEArca: VWO). It has $108 million in INP, but also owns a tiny stake in the WisdomTree India Earnings ETF (NYSEArca: EPI).

Is it considering shifting toward the upstarts and away from the dominant players? If so, can we expect more dalliances? Perhaps a dose of the SPDR China Fund (NYSEArca: GXC) to balance out that large FXI position?

I suppose we’ll just have to watch future 13-F filings to find out.

• Education Management Corp (EDMC)
• First Financial Bancorp (FFBC)
• Mechel OAO (MTL)
• Post Properties, Inc (PPS)
• Royal Dutch Shell plc (RDS.B)
• Textainer Group Holdings Ltd (TGH)
• United Financial Bancorp, Inc (UBNK)
• Wal-mart de Mexico SAB de CV (WMMVY)

Today at 2:00 PM EST, the Department of Treasury will release the balance of the Treasury Budget for
January, with an anticipated deficit of $52.1 billion, following the reported $91.8 billion deficit in December.

Upcoming Releases
Treasury Budget (02/10 at 2:00 PM EST)
Initial Claims (02/11 at 8:30 AM EST)
Retail Sales (02/12 at 8:30 AM EST)
Business Inventories (02/12 at 10:00 AM EST)

Chicago, IL – February 10, 2010 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Coca Cola Company (KO), Boeing Company (BA), General Electric Company (GE), Lockheed Martin Corporation (LMT) and Northrop Grumman Corporation (NOC).

Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=5513

Here are highlights from Tuesday’s Analyst Blog:

Coca Cola Reports In Line

Coca Cola Company (KO) reported fourth quarter 2009 results with earnings of 66 cents per share, which was in line with the Zacks Consensus Estimate. Earnings were up 3.0% year-over-year.

Net revenues increased 5.4% year-over-year during the quarter, due to a 5% positive impact from currency translation and 1% increase in concentrate sales which were partially offset by a 1% impact from pricing and mix.

Worldwide unit case volume increased 5% in the quarter, aided by a 6% improvement in international unit case volume and a 4% growth in Coca Cola, its trademark brand. The emerging markets of China and India grew an impressive 29% and 20%, respectively.

France also reported a strong growth of 12% during the fourth quarter. In addition, strong unit case volume growth was observed in other key markets including Brazil, Mexico and Germany. Europe posted a 1% volume growth, while North American volume declined 1%.

Boeing Progressing on 747-8

Boeing Company (BA) successfully completed the first test flight of its long-in-the-making 747-8 Freighter. The 747-8 Freighter is the new, high-capacity 747 that brings the benefits of low operating costs and best economics in any freighter to cargo operators. The 747-8 is powered by four General Electric Company’s (GE) GEnx-2B engines. The airplane is 250 feet, 2 inches (76.3 m) long, which is 18 feet, 4 inches (5.6 m) longer than the 747-400 Freighter. The stretch provides customers with 16% more revenue cargo volume compared to its predecessor. That translates to an additional four main-deck pallets and three lower-hold pallets.

Boeing launched the airplane on Nov 14, 2005, with firm orders for 18 747-8 Freighters: 10 from Cargolux of Luxembourg and eight from Nippon Cargo Airlines of Japan. Till date, Boeing has secured 108 orders for the 747-8. The customers are a varied mix of airlines like AirBridgeCargo Airlines, Atlas Air, Cathay Pacific, Dubai Aerospace Enterprise, Emirates SkyCargo, Guggenheim and Korean Air.

Headquartered in Chicago, Boeing is the world’s largest manufacturer of commercial jet liners and military aerospace products (based on total sales). Boeing designs and produces commercial airplanes, defense systems, and civil and defense space systems. It is also the largest NASA contractor. Non-airplane products include helicopters, electronic and defense systems, missiles, satellites, rocket engines, launch vehicles, and advanced information and communication systems.

Boeing is one of the best-positioned companies among its defense peers due to its balanced exposure to commercial aircraft and defense equipment. Defense peers like Lockheed Martin Corporation (LMT) and Northrop Grumman Corporation (NOC) dabble only in defense equipment.

Going forward we believe Boeing’s $316 billion order backlog, strong order booking, stable cash flow generation and a globally diversified customer base will help maintain the growth momentum. However, a bearish commercial aerospace market, apprehension over growth in defense spending, and delays in the launch of the 787 series jetliner will affect Boeing’s performance in the near term.

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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=5517

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=5518.

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Company Description

Reliance Steel provides metals processing services through more than 200 locations in 38 states, and several countries including Mexico, China, South Korea and Canada. Its products include galvanized, hot-rolled and cold-finished steel, stainless steel, aluminum, brass, copper, titanium and alloy steel.

Zacks Consensus Estimates Rise Ahead of the Earnings Report

Its been well over a year since I've covered any steel companies for the Value Rank Buy as the estimate picture hasn't been pretty during that time.

However, that appears to be changing.

On Jan 20, Reliance Steel provided earnings guidance for the fourth quarter and full year which was well ahead of the Zacks Consensus Estimates. The company said both demand and pricing levels were at levels better than expected even given the fourth quarter seasonal pressures that it normally experiences.

Earnings per share for the fourth quarter are expected to be in the range of 95 cents to $1.05 per share. The Zacks Consensus called for 38 cents.

For the full year, EPS is expected to be $1.71 to $1.81 per share. The Zacks Consensus had been at $1.14.

On the news, the analysts scrambled to raise estimates. The fourth quarter Zacks Consensus jumped 165.79% to $1.01 per share in just the last month.

Similarly, the 2009 Zacks Consensus Estimate has also climbed during that same time period to $1.78 which is at the high end of the company's guidance. 9 estimates have been revised higher in the past month.

Because of the earnings guidance for 2009, analysts are also extremely bullish on 2010 earnings. They expect earnings growth of 96.34%. 6 estimates have been revised higher in the last 30 days with the Zacks Consensus jumping 25 cents to $3.50 per share.

Reliance is scheduled to report fourth quarter and full year results on Feb 18.

Reliance Steel Surprised on the Third Quarter

On Oct 22, Reliance Steel reported its third quarter results and beat the Zacks Consensus by 26.67%. Earnings per share were 57 cents compared with the Zacks Consensus of 45 cents.

Sales, however, fell to $1.24 billion from $2.57 billion in the year ago and were flat compared with the second quarter of 2009. Average price per ton sold fell 34% compared to the year ago quarter and was flat compared with the 2009 second quarter.

Value Fundamentals

Reliance Steel is a Zacks #1 Rank (strong buy) stock. It has a price-to-book ratio of 1.18. The company also has a stellar 5-year average return on equity (ROE) of 20.57%.

Reliance rewards shareholders with a dividend yielding 1.00% which is higher than the industry average which is no dividend at all.

Tracey Ryniec is the Value Stock Strategist for Zacks.com. She is also the Editor in charge of the market-beating Zacks Value Trader service.

Zacks Investment Research

Net revenues increased 5.4% year-over-year during the quarter, due to a 5% positive impact from currency translation and 1% increase in concentrate sales which were partially offset by a 1% impact from pricing and mix.

Worldwide unit case volume increased 5% in the quarter, aided by a 6% improvement in international unit case volume and a 4% growth in Coca Cola, its trademark brand. The emerging markets of China and India grew an impressive 29% and 20%, respectively.

France also reported a strong growth of 12% during the fourth quarter. In addition, strong unit case volume growth was observed in other key markets including Brazil, Mexico and Germany. Europe posted a 1% volume growth, while North American volume declined 1%.

Carbonated soft drink (CSD) case volume grew 3% during the quarter, after a continued decline for more than a year. Non carbonated beverage (NCB) volume increased 9% led by sound growth across the portfolio, including juices and juice drinks, sports drinks, teas and water brands. In North America, NCB’s were flat year-over-year.

Gross profit margin expanded 74 basis points (bps) to 64.7% in the quarter versus 64.0% in the comparable prior-year period. The increase was primarily attributable to positive foreign currency fluctuations and lower commodity costs.

Cash from operations for the year was $8.2 billion, reflecting an increase of 8%. The company has a debt-to-capitalization ratio of 16%.

The revenue decreases were mainly due to lower fracturing and cementing activity in the U.S., coupled with a significant reduction in pricing for its products and services. The segment's operating loss was $16.9 million, with an operating margin of negative 4%.
 
In the Canadian Pressure Pumping segment, revenue increased 40% sequentially and decreased 38% year-over-year to $82.3 million. Operating profit for this segment was $4.5 million, a significant increase sequentially but down considerably year-over-year. The segment recorded an operating margin of 5%, compared to negative 3% in the prior quarter and 22% in the year-ago quarter. Lower drilling activity and weak pricing were the main reasons behind the depressing year-over-year margin comparison.
 
The International Pressure Pumping segment revenue was $283.9 million, which increased 10% sequentially but was down by the same percentage year-over-year. All the regions in this segment except Asia-Pacific witnessed a sequential increase in revenue during the quarter. The segment operating margin was 9%, compared to 8% in the previous quarter and 15% in the year-earlier quarter.
 
In the Oilfield Services Group segment, revenue decreased approximately 18% sequentially and 28% year-over-year to $180.5 million. The segment recorded an operating margin of 2%, compared to 14% in the previous quarter and 17% in the year-earlier quarter. 

Capital spending totaled $39.7 million for the quarter. Cash at the end of the quarter was $261.1 million, while debt slightly increased to $509.7 million.

Chicago, IL – February 8, 2010 – Zacks Equity Research highlights CPFL Energia S.A. (CPL) as the Bull of the Day and Newell Rubbermaid (NWL) the Bear of the Day. In addition, Zacks Equity Research provides analysis on Costco Wholesale Corporation (COST), BJ’s Wholesale Club Inc. (BJ) and Wal-Mart Stores Inc. (WMT).

Full analysis of all these stocks is available at http://at.zacks.com/?id=5506

Here is a synopsis of all five stocks:

Bull of the Day:

We are maintaining our Outperform rating on CPFL Energia S.A. (CPL). The company posted in-line results for the third quarter of 2009, despite non-recurring items.

The company's outlook for the short-to-medium term remains positive, mainly considering the more relaxed monetary policy in Brazil and the growing demand for electricity, even though the company is still contending with a difficult business environment around the world.

Finally, CPL has a solid dividend payout and its valuation appears to be highly attractive mainly considering the non-cyclical nature of the company.

Bear of the Day:

Newell Rubbermaid’s (NWL) susceptibility to the global economic downturn is adversely affecting its top-line growth. The company recorded a 14% decline in net sales during 2009 amid a drastic squeeze in consumer disposable income and corporate spending.

Moreover, intense competition from other established manufacturers, coupled with a debt-heavy balance sheet and exposure to adverse foreign currency translations, severely undermine the company's future growth prospects and profitability.

Consequently, our recommendation for Newell Rubbermaid is Underperform as we anticipate it to perform well below the broader market.

Latest Posts on the Zacks Analyst Blog:

Costco Sales Climb in January

Costco Wholesale Corporation (COST), one of the leading U.S. warehouse club operators, recently reported better-than-expected sales for the four-week period ended Jan 31, 2010.

Costco’s comparable-store sales for January rose 8%, reflecting a comparable sales growth of 4% at its U.S. locations and 25% at its international divisions. Year-to-date, total comparable-store sales grew 6%, with U.S. sales up 3% and international sales up 18%. The results were favorably impacted by rising gasoline prices and a weaker U.S. dollar.

Excluding the effects of gasoline prices and a softer dollar, Costco’s comparable-store sales for January rose 2%, with U.S. comparable sales remaining flat, while international comparable sales were up 9%. Year-to-date, total comparable-store sales grew 3%, with U.S. sales up 2% and international sales up 8%.

Total net sales for January surged 10% to $5.62 billion from $5.09 billion reported in the same month last year. Year-to-date sales increased 8% to $32.45 billion from $30.02 billion reported in the same period last year.

Costco currently operates 566 warehouses, including 413 in the United States and Puerto Rico, 77 in Canada, 32 in Mexico, 21 in the United Kingdom, 9 in Japan, 7 in Korea, 6 in Taiwan and 1 in Australia.

Costco faces stiff competition from BJ’s Wholesale Club Inc. (BJ) and Sam’s Club, a division of Wal-Mart Stores Inc. (WMT).

Get the full analysis of all these stocks by going to http://at.zacks.com/?id=5507.

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. Subscribe to this free newsletter today by visiting http://at.zacks.com/?id=5508.

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=5509.

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

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

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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

Results included a curtailment gain on the company's benefit plans ($15.5 million) that was partially offset by other one-time costs such as stock-based compensation and severance costs ($7.1 million) and asset write-downs ($6.1 million). Net income included a $20.3 million tax benefit related to net securities losses in 2007 and 2008.

Including the above-mentioned one-time costs and benefits, net loss for the quarter was $3.6 million or 4 cents per share, compared to net income of $18.6 or 22 cents per share in the fourth quarter of 2008.
 
Total expenses decreased 7.4% to $159.9 million against $172.6 million in the year-ago quarter. Higher money transfer transaction volumes and decreased operating expenses were offset by declining bill payment transaction volumes and continued weakness in Mexico and Spain.

MoneyGram’s total revenue for the quarter was $296.4 million, down 7.1% from $319.0 million in the year-ago period. Fourth quarter 2008 total revenue included net securities losses of $10.2 million compared to $0.7 million in the reported quarter, and investment revenue that was $27.6 million more that in 2009.

Segment Results

In the Global Funds Transfer segment, MoneyGram’s revenue rose by 4.6% to $263.8 million versus $252.2 million in the year-ago period. Money transfer transaction volume excluding bill payment increased 7%, while money transfer fee and other revenue increased 6% to $230.6 million versus $217.0 million in the prior-year period.

On a constant currency basis, money transfer fee and other revenue excluding bill payment increased 3% on a year-over-year basis. Bill payment transaction volume decreased 3% and revenue declined 5% to $33.1 million from $34.7 million in the prior-year quarter.

Results were negatively affected by currency valuation changes and a decline in average money transfer fees during the quarter. Global agent locations reached 190,000, an increase of 8% over the prior-year quarter.

The economic downturn in Spain continues to impact MoneyGram's non-U.S. transaction growth. Excluding Spain, transactions originating outside the U.S. saw healthy growth of 20% from the prior year. Transaction volume to Mexico decreased 13% year-over-year in the reported quarter.

In the Financial Paper Products segment, MoneyGram’s total revenue declined 43.1% to $30.1 million from $52.9 million in the prior-year quarter. Net revenue in the fourth quarter of 2009 and 2008 reflects investment revenue of $5.7 million and $33.4 million, respectively.

For full-year 2009, MoneyGram’s total revenue increased 26.4% to $1.17 billion from $927.1 million in 2008. Total revenue in 2008 included net securities losses of $340.7 million and investment revenue that was $128.9 million more favorable compared with 2009. Net loss, including one-time costs, was $102.1 million or $1.24 per share, down from a net loss of $345.7 million or $4.19 per share in 2008.

As of October 31, 2009, MoneyGram had cash and cash equivalents of $3.8 billion, net receivables of $1.05 billion and investments of $298.6 million.

Liquidity

The company ended the quarter with assets in excess of payment service obligations of $313.3 million and also paid down the remaining $45.0 million balance on its revolving credit facility. On Dec 22, 2009, MoneyGram made an optional repayment of $40 million on its tranche B term loan under the senior secured credit facility, thereby lowering its total outstanding debt by 19.0% to $187 million since Jan, 2009.

Costco’s comparable-store sales for January rose 8%, reflecting a comparable sales growth of 4% at its U.S. locations and 25% at its international divisions. Year-to-date, total comparable-store sales grew 6%, with U.S. sales up 3% and international sales up 18%. The results were favorably impacted by rising gasoline prices and a weaker U.S. dollar.

Excluding the effects of gasoline prices and a softer dollar, Costco’s comparable-store sales for January rose 2%, with U.S. comparable sales remaining flat, while international comparable sales were up 9%. Year-to-date, total comparable-store sales grew 3%, with U.S. sales up 2% and international sales up 8%.

Total net sales for January surged 10% to $5.62 billion from $5.09 billion reported in the same month last year. Year-to-date sales increased 8% to $32.45 billion from $30.02 billion reported in the same period last year.

Costco currently operates 566 warehouses, including 413 in the United States and Puerto Rico, 77 in Canada, 32 in Mexico, 21 in the United Kingdom, 9 in Japan, 7 in Korea, 6 in Taiwan and 1 in Australia.

Costco faces stiff competition from BJ’s Wholesale Club Inc. (BJ) and Sam’s Club, a division of Wal-Mart Stores Inc. (WMT).

Earnings per share (excluding foreign-currency effects) came in at $1.57, below the Zacks Consensus Estimate of $1.69. Compared to the fourth quarter of 2008, Chevron’s adjusted earnings per share fell 17.4% (from $1.90 to $1.57). However, quarterly revenue of $48.7 billion was up 7.7% from the year-earlier level, driven by robust E&P results.

Reported Quarter vs. Estimate Revisions Trend

Chevron’s quarterly miss didn’t come as a major surprise. Though there were no estimate revisions in either direction over the last 7 days, earnings estimates for the company have been trending slightly down over the past month, with the quarterly Zacks Consensus Estimate going down by a penny. Overall, 8 out of the 15 analysts covering the stock pulled back on fourth quarter projections during that time, while 3 raised their estimates.

With respect to earnings surprises, Chevron has had a bearish run over the last four quarters (including the quarter under discussion). This is the company’s 3rd negative surprise in the past 4 quarters. 

Upstream Earnings Increase

Chevron’s total production of crude oil and natural gas increased 9.4% from the year-earlier level to 2.8 million oil-equivalent barrels per day (MMBOE/d), driven by new project start-ups (in the U.S. and Nigeria), expansion of capacity at Tengiz in Kazakhstan, together with the restoration of Gulf of Mexico volumes that were offline in the fourth quarter of 2008 due to hurricanes.

U.S. volumes rose more than 21%, while Chevron’s international operations experienced an approximately 6% rise in output. Gains on the production front were supported by higher realized oil prices, resulting in a 27% year-over-year rise in upstream earnings to $4.0 billion.

Production Outlook Remain Strong

Chevron’s production outlook remains one of the most robust in its peer group, with a number of major deepwater projects scheduled to come online during the next few years. Major start-ups during the last few months include the Tahiti Field in the Gulf of Mexico, Frade offshore Brazil and Tombua-Landana in Angola.

Downstream Affected by Weak Refining Margins

Chevron’s downstream segment lost $613 million during the quarter, as against profit of $2.1 billion in the previous-year period. Demand for refined products remained depressed in the face of plentiful supply, resulting in weak margins on the sale of gasoline and other refined products.

The results were also affected by decreased refinery crude-input in the company’s U.S. operations, primarily due to the planned shutdown at the facility in El Segundo, California.

Chemicals

Earnings in the chemicals business increased significantly (by 250.0%) year-over-year to $98 million, reflecting higher margins on the sale of lubricant and fuel additives in tandem with lower utility and manufacturing costs.

Capital Expenditure & Balance Sheet

Chevron spent $6.2 billion in capital expenditures during the quarter (bringing the total capex for the full year 2009 to $22.2 billion), down from the year-earlier period’s 7.0 billion. Approximately 73% of the total outlays pertained to upstream projects. At the end of the quarter, the company had $8.7 billion in cash and long-term debt of $10.5 billion, with a debt-to-total capitalization ratio of about 10.3%.

Net sales for the quarter increased 11.5% year-over-year to $4.1 billion as unit volume increased 3.0%, pricing contributed 3.5% and foreign exchange contributed 5.0%. Organic sales (excluding foreign exchange, acquisitions and divestitures) increased 6.5% in the quarter.

Full-year 2009 net sales were flat year-over-year to $15.3 billion. Unit volume growth was 0.5% and pricing increased 6.0%, which was partially offset by a 6.5% negative foreign exchange impact. Organic sales for the year increased 6.5%.

North American sales increased 5.0% driven by 5.5% unit volume growth and a 1% favorable foreign exchange, partially offset by 1.5% lower pricing. In Latin America, sales grew 22.5% as unit volume increased 5.0%, driven by solid gains in Brazil and Columbia. In addition, pricing contributed 12.0% and foreign exchange contributed positive 5.5% to the top line.

In Europe/South Pacific, sales grew 12.5% as unit volume increased 2.5%, driven by volume gains in France, Italy, the United Kingdom and the GABA business. Although pricing was down 0.5%, foreign exchange contributed positive 10.5%. Sales in Greater Asia/Africa increased 10.5%, while unit volume grew 8.0% as volume gains in India, the Greater China and Thailand. Pricing increased 0.5% and foreign exchange contributed positive 2.0%.

Sales in the Hill’s Pet Nutrition business grew 1.5%, however unit volume declined 8.5% due to declines in the U.S., Japan and Russia, partially offset by gains in Germany, Australia and Mexico. Pricing contributed 3.0% and favorable foreign exchange contributed positive 4.0% to the top line.

Gross margins expanded 352 basis points (bps) to 59.4% from 56.0% in the prior-year period, driven by benefits of restructuring activities and pricing. The operating margin also increased 308 bps to 24.3% versus 21.2% in the prior-year quarter. Capital expenditures for fiscal 2009 were $575 million.

For the full year, net cash provided by operations increased 42% to $3.3 billion, due to efficient working capital management, especially a reduction in receivable days outstanding. The company has a debt-to-total-capitalization ratio of 50.5%.

Earnings by Segment

The Exploration and Production (E&P) segment reported earnings of $1.2 billion during the quarter, up significantly year over year. The increase was mainly driven by increased liquid prices, partially offset by lower natural gas prices and volumes. Daily production from the E&P segment including Canadian Syncrude averaged 1.83 million barrels of oil equivalent per day (MMBOE/d), down from 1.87 MMBOE/d in the year-ago quarter.

The Refining and Marketing (R&M) segment reported a loss of $215 million, compared to a profit of $289 million in the year-ago quarter. The domestic loss in the segment was partially offset by profit from international operations. However, realized refining and integrated margins were significantly lower than in the year-ago quarter. Domestic refining crude oil capacity utilization rate for the quarter averaged 83%, compared to 94% a year earlier. International capacity utilization rate averaged 58%, versus 89% last year. Worldwide utilization averaged 76%, compared to 93% in the year-ago period.

The Midstream segment (which includes the company’s 50% interest in DCP Midstream LLC) contributed $97 million to the net income during the quarter, up approximately 41% year over year. The increase was primarily driven by strong realized prices.

ConocoPhillips’ earnings from its LUKOIL Investment segment came in at $388 million, up dramatically from the prior-year quarter. LUKOIL’s estimated contribution to the company’s quarterly E&P volumes was 431,000 barrels of oil equivalent per day. The Chemicals unit reported earnings of $54 million as against a loss of $6 million a year ago.

On the Balance Sheet

During the quarter, ConocoPhillips generated cash from operations of $5.1 billion. At the end of the quarter, the company had $28.7 billion in debt (reduced from $30.5 billion at the end of previous quarter), with a debt-to-capitalization ratio of 31%. During the quarter, Conoco paid $700 million in dividends. The company invested $3.1 billion in capital expenditures.

In an effort to strengthen its financial position and improve its balance sheet, Conoco intends to sell $10 billion of assets over the next two years, and plans to spend $11.2 billion for the capital program this year. The company’s initiatives to cut down its debt level are working well, resulting in a 2% reduction in debt-to-capitalization ratio. It has set a goal to reduce this level to 20% to 25%.

Conoco is becoming increasingly focused on E&P activities. It recently announced plans to expand the Surmont heavy oil project in Canada. Surmont is a Canadian oil sands steam-assisted gravity drainage (SAGD) facility. In addition, discoveries in the Browse Basin off the northwest coast of Australia and in the Gulf of Mexico are notable.

With leading positions in both natural gas and heavy crude oil in North America and a growing exposure to lucrative international regions, we believe Conoco will be able to replace reserves and sustain production growth over the long term.

We currently have a Neutral recommendation for ConocoPhillips shares.

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