Chicago, IL – October 16, 2009 – Zacks Equity Research highlights Semtech Corp. (SMTC) as the Bull of the Day and Washington Federal (WFSL) the Bear of the Day. In addition, Zacks Equity Research provides analysis on Bank of America (BAC), Hasbro (HAS) and Peabody Energy (BTU).

Full analysis of all these stocks is available at http://at.zacks.com/?id=2676

Here is a synopsis of all five stocks:

Bull of the Day:

Semtech Corp. (SMTC) is a fabless supplier of analog and mixed-signal semiconductor devices. Management has been diversifying the product portfolio, introducing new high-margin products and broadening the customer base.

July quarter results exceeded the consensus on both the top and bottom lines. Forward guidance is for 6-10% revenue increase in the October quarter.

Both revenue growth and margin expansion are expected to return in the second half of fiscal 2010 when the new product platforms gain traction. We are reiterating our BUY rating on SMTC shares.

Bear of the Day:

Washington Federal’s (WFSL) third quarter earnings were in line with the Zacks Consensus Estimate. However, the results significantly deteriorated from the prior-year quarter due to a huge increase in provision for loan losses, primarily in response to a deteriorating residential land and construction portfolio.

Credit quality drastically worsened during the quarter. However, declining deposit rates helped improve funding concerns to a great extent and capital position remained strong.

Though margin expansion and increased market share through acquisitions will be a great support going forward, we are concerned about the company's significant exposure to real estate markets and suspect that it will continue to experience credit quality deterioration. Therefore, we recommend the shares as Underperform.

Latest Posts on the Zacks Analyst Blog:

Initial Jobless Claims Fall Again

On the continuing claims front, there was also some apparent good news -- they fell by 75,000 to 5.992 million, the first time in many months that they have been below the 6 mlllion mark. However, the continuing claims only track regular state benefits, which run ot after 26 weeks. On average, people who are out of work have been looking for a job for over 26 weeks now, a situation that has not been seen since the end of WWII.

After the regular state benefits run out, then emergency Federal benefits kick in (a major element of the stimulus package). There are now more than 3.8 million people getting the extended benefits -- up 16,000 from last week (one week behind regular continuing claims, and two weeks behind inital claims). Anyone who claims that the stimulus is not working needs to be able to look at those 3.8 million Americans and their families and tell them that they would be better off if they had no income at all coming in right now -- that they are better off doing business at the local food bank rather than at Bank of America (BAC).

Even those extended benefits do not last forever, and people are starting to drop off the roles. Both the Senate and the House have passed measures to extend the benefits for a few more months, especially in high unemployment states, but they are still hammering out the differences in the bills, but it looks like something will be signed soon. Perhaps that will mean that their kids will get things for Chistmas made by Hasbro (HAS) and not Peabody Energy (BTU).

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.

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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.

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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=5509.

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Here are highlights from Thursday's Analyst Blog:

Sell Liberty Property in Near Term

Liberty Property Trust (LRY) is a self-administered and self-managed real estate investment trust (REIT) that focuses primarily on prime suburban properties in the Southeast, Mid-Atlantic, and Midwest regions of the United States. The company's portfolio comprises over 700 industrial and office properties, spanning 77 million square feet of space.

Office and industrial markets continue to weaken throughout the US. In the current environment, we do not favor suburban industrial/office companies as rental rates and occupancies will continue their downward trend.

The company recently cut its quarterly payout to $0.475 per share, 24% lower than the previous payout. Negative job growth trends will keep shares under pressure.

3Com Fairly Priced at $4

3Com Corp (COMS) is a leader in the Chinese enterprise networking market, but may face increased competition in the server market with the entry of large players such as Cisco Systems (CSCO).

Through improved operational efficiency, 3Com achieved profitability on a GAAP basis for its third consecutive quarter. We are pleased with the company's performance in recent quarters, but are concerned about the worsening global economic outlook and a weak IT spending in China. Moreover, the future of its business in China concerns us as the company reduces its dependence on Huawei as a reseller.

Krispy Kreme Rockets Up 46%

Shares of Krispy Kreme Doughnuts Inc (KKD) are rocketing 46% today to $3.34, after announcing it secured credit agreement amendments that will enable it to stay in compliance. The amendments give the doughnut chain time to weather the recession while continuing to close under-performing units and reinvigorating same-store sales.

Comp sales showed signs of stabilization in the latest quarter ended February 1, rising 0.9%. Revenue, however, fell 17% to $91.8 million, as the company continues to close under-performing stores.

Semtech Target Upped to $18

Semtech Corp. (SMTC) is a fabless supplier of analog and mixed-signal semiconductor devices. Management has been diversifying the product portfolio, introducing new high-margin products and broadening the customer base.

January quarter results were short of consensus estimates. Forward guidance is for a -7% to -17% revenue decline in the April quarter. Both revenue growth and margin expansion are expected to return in the second half of fiscal 2009 when the new product platforms gain traction.

Want more from Zacks Equity Research? Subscribe to the free Profit from the Pros newsletter: http://at.zacks.com/?id=2649.

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

October quarter revenue was in-line with consensus estimates, while the EPS exceeded. Forward guidance is for a -8% top -20% revenue decline in the January quarter.

Both revenue growth and margin expansion are expected to materialize when the new product platforms gain traction. We are reiterating our BUY rating on SMTC shares.

Sejuti Banerjea contributed to this report.

Read the full analyst report on SMTC

Shares of Semtech are currently trading at a 15.6x multiple of price to our current 2009 earnings estimate (P/E). The healthy pipeline and robust design win activity are encouraging. The backlog increased again in the last quarter, with lead times stretching out a bit. The margin story surrounding the stock is regarding its power management product line. The new power management products will raise the segment gross margin to within the long-term targeted range.

Therefore, cash flow is likely to strengthen. While the Reynosa fire will result in weaker results for the power discrete product line, the net impact on overall results is not expected to be too great. Although the macro situation in the U.S. was expected to impact consumer spending, the consumer segment grew very strongly in the last quarter, and management expects continued growth in Q3. We expect the shares to trade higher within the next six months.

Consequently, we are reiterating our $20 price target (21.1x P/E) and recommending investors to accumulate shares. The TTM ROE (based on pro forma profits) has grown in each of the last five quarters, and was 17.2% in the last quarter. The DuPont analysis clearly indicates that all the three basic components of the ROE have grown during this period. New higher-margin power management products and increased production overall are gradually improving profitability of the business.

Sejuti Banerjea contributed to the report.

Read the full analyst report on SMTC