Equities Research Analysts’ Ratings Reiterations for October, 4th (ADS, AMG, AMSF, AMX, DDR, EL, FB, FDX, HIBB, HIG)
Alliance Data Systems Corp. (NYSE:ADS) had its buy rating reaffirmed by analysts at Deutsche Bank. Deutsche Bank currently has a $240.00 price target on the stock.
Affiliated Managers Group (NYSE:AMG) had its neutral rating reissued by analysts at Zacks. They currently have a $195.00 price target on the stock. Zacks’ analyst wrote, “We are initiating coverage on Affiliated Managers with a long-term Neutral recommendation. The company’s second-quarter economic net income (ENI) came in substantially ahead of the Zacks Consensus Estimate. Results benefited from solid revenue growth and a fall in expenses. Moreover, improvement in assets under management (AUM) and a stable balance sheet were the other highlights. We believe the company’s diversified product mix and footprints as well as steady growth in AUM will supplement future growth. Moreover, strong balance sheet position will enable the company to further invest in affiliates. However, high debt levels, significantly higher intangibles and rising expenses remain causes of concern.”
AMERISAFE (NASDAQ:AMSF) had its neutral rating reaffirmed by analysts at Zacks. Zacks currently has a $37.00 target price on the stock.
America Movil S.A.B. de C.V. (NYSE:AMX) had its neutral rating reaffirmed by analysts at Zacks. The firm currently has a $21.00 target price on the stock. Zacks’ analyst wrote, “We maintain our Neutral recommendation on America Movil. The company has a strong grip over the Latin American wireless market and is currently implementing its 4G network across various Latin America. Increased penetration of 4G mobile services and a competitive pricing policy are expected to boost the company’s growth prospects. Further, America Movil remains focused on expanding the PayTV platform, which is one of its highest revenue contributors. America Movil’s various partnerships with other firms will likely enhance its networks within Latin America as well as in offshore key markets such as Asia and the Middle East. Nevertheless, we prefer to stay on the sidelines considering the unstable economic conditions, regulatory issues, a stiff competitive scenario, huge customer churn and high spending associated with promotional activity.”
DDR Corp (NYSE:DDR) had its neutral rating reiterated by analysts at Zacks. The firm currently has a $17.00 price target on the stock. Zacks’ analyst wrote, “DDR is scheduled to report third-quarter 2013 earnings on Nov 4, 2013, after the closing bell. Aided by organic growth and prime assets acquisitions, the company reported a year over year increase in second-quarter 2013 operating FFO per share. However, earnings came in line with the Zacks Consensus Estimate as the positive impact was partly dwarfed by asset sales. Nevertheless, the company’s long-term strategy of improving the balance sheet by reducing leverage raised hopes. Moreover, the recent 7 assets portfolio buyout and tenant base strengthening efforts promise solid growth, going forward. However, stiff competition from other players in the market, rise in interest rates, dependency on few tenants, and ascend in Internet sales that adversely impact the demand for retail space remains our concerns. Hence, we maintain our Neutral recommendation on the stock.”
Estee Lauder Cos. (NYSE:EL) had its neutral rating reissued by analysts at Zacks. Zacks currently has a $73.00 target price on the stock. Zacks’ analyst wrote, “Estee Lauder’s fourth-quarter fiscal 2013 earnings of $0.24 per share increased 41.0% year over year. The results also beat the Zacks Consensus Estimate by 9.1%. Profits were driven by strong sales and higher operating income. Net sales climbed 8% backed by strong results in all geographical regions. We are also impressed with the company’s cost saving initiatives which boosts margins. Moreover, aggressive marketing investment coupled with continued product innovation is expected to boost sales in the coming quarters. Further, the company’s fast expansion into emerging markets is expected to insulate it from the ongoing macroeconomic challenges in the western countries. However, lack of strategic acquisitions and a difficult consumer spending environment remain overhangs. We, thus, prefer to remain on the sidelines with a Neutral rating. “
Facebook (NASDAQ:FB) had its outperform rating reaffirmed by analysts at William Blair. The analysts wrote, “Over the past few weeks, we spoke with several private companies and advertisers about their experiences with and views on Facebook. Our conversations focused on the continued growth of its mobile product offering, the rollout of video ads, and the monetization of Instagram.”
FedEx Corp. (NYSE:FDX) had its neutral rating reaffirmed by analysts at Zacks. The firm currently has a $119.00 target price on the stock.
Hibbett Sports (NASDAQ:HIBB) had its neutral rating reaffirmed by analysts at Zacks. Zacks currently has a $59.00 price target on the stock. Zacks’ analyst wrote, “We remain impressed with Hibbett’s sustained focus on expanding store network and improving store productivity, which are the key revenue drivers for the stock. Moreover, we believe that the strategy of doubling the distribution facility’s size will aid the company to keep its growth momentum in mid-sized and smaller markets, which constitute the company’s primary focus. Moreover, Hibbett’s debt-free balance sheet provides it financial flexibility to drive future growth. However, anticipating competitive risks from DICK’s Sporting’s strategic move of entering smaller and mid-sized markets, we remain skeptical about the stock’s performance. Moreover, we believe that due to lack of new construction activities in smaller markets, Hibbett’s store expansion plans may get delayed. Therefore, we are maintaining our long-term Neutral stance on the stock.”
Hartford Financial Services Group (NYSE:HIG) had its neutral rating reiterated by analysts at Zacks. They currently have a $32.00 target price on the stock.
H&R Block (NYSE:HRB) had its neutral rating reaffirmed by analysts at Zacks. The firm currently has a $29.00 price target on the stock. Zacks’ analyst wrote, “H&R Block’s first-quarter fiscal 2014 loss per share was wider than the Zacks Consensus Estimate and the year-ago quarter. The company s decision to vend off H&R Block Bank will free up additional capital, which can be deployed in strategic opportunities. Moreover, the implementation of Affordable Care Act will open revenue generating avenues for H&R Block. Its association with Go Health will help H&R Block foray into the health insurance brokerage business. According to management, the company has successfully captured market share in the digital online category from Intuit for the third consecutive year. It is not renewing its agreement with Wal-Mart in the U.S. as performance and results from the channel failed to match its expectations. These initiatives further reinforce its efforts to improve operational efficiency. Returning value to its shareholders will also help retain investor confidence in the stock. However, deteriorating debt-to-capital ratio and a fluctuating cash balance keeps us cautious “
Incyte Corp. (NASDAQ:INCY) had its neutral rating reissued by analysts at Zacks. They currently have a $43.00 target price on the stock. Zacks’ analyst wrote, “Incyte reported earnings of $0.05 per share in the second quarter of 2013, above the year-ago earnings of $0.03 but below the Zacks Consensus Estimate of $0.08 per share. The company now expects 2013 Jakafi sales in the range of $220-$230 million. Jakafi has performed well since launch and is expected to keep doing so going forward. We are encouraged by the company’s efforts to expand Jakafi’s label. In Aug 2013 the company’s share prices were up significantly following the positive results from the RECAP study on Jakafi (pancreatic cancer). However, we remain concerned about Incyte’s dependence on a single product for growth. We retain our Neutral recommendation on the stock.”
Macerich (NYSE:MAC) had its neutral rating reiterated by analysts at Zacks. Zacks currently has a $59.00 target price on the stock.
Nike (NYSE:NKE) had its neutral rating reaffirmed by analysts at Zacks. The firm currently has a $75.00 target price on the stock. Zacks’ analyst wrote, “We remain impressed with Nike’s consistent positive earnings surprises, strong revenue growth and optimistic guidance. Nike posted robust first quarter results, which prompted management to provide an impressive outlook for fiscal 2014. Nike aims to increase its global reach and market share by aggressively expanding its operations in the emerging markets, while focusing on direct-to-consumer business and other brands, which augur well for future operating performance. Further, we believe that the company’s innovative products and services would help in boosting its top-line performance. However, we expect discretionary spending and intense competition amid rapidly changing customer preferences to undermine Nike’s prospects. Consequently, we prefer to be on the sidelines at present and thereby, maintain our long-term Neutral recommendation.”
Natural Resource (NYSE:NRP) had its neutral rating reaffirmed by analysts at Zacks. They currently have a $20.00 price target on the stock. Zacks’ analyst wrote, “Natural Resource Partners L.P.’s performance in the last quarter was affected primarily due to softness in the global metallurgical coal market. The partnership’s focus on the development of low-cost and profitable mines in the Illinois basin will contribute to a steady revenue flow in the future. Natural Resource is expected to benefit from the rising export demand for metallurgical coal given the World Steel Association’s projection of a 3.2% increase in steel utilization worldwide in 2014. In addition, the partnership’s healthy liquidity position will allow it to effectively carry out its growth-centric ventures. However, rising operating expenses and regulatory hurdles are a matter of concern. We retain our Neutral recommendation on the stock. “
Precision Castparts Corp. (NYSE:PCP) had its neutral rating reiterated by analysts at Zacks. They currently have a $243.00 price target on the stock. Zacks’ analyst wrote, “We are retaining our Neutral recommendation on Precision Castparts with a target price of $242. Reported revenues registered a hike of 20.4% year over year, while earnings grew 22.6%. The improved results in the recently reported quarter came on the back of increased demand in the commercial aerospace as well as strong oil and gas businesses. Two of the three reporting segments posted double digit revenue growth during the quarter. Furthermore, IGT is also showing good momentum in its aftermarket backlog as the company is shipping out large quantities of nickel-based, severe service tubular product over the upcoming four quarters. The company expects its major end markets to drive organic growth. In addition, the aerospace division is also performing well. Nevertheless, competition and pricing pressures remain our concerns. “
Koninklijke Philips Electronics (NYSE:PHG) had its neutral rating reiterated by analysts at Zacks. They currently have a $33.00 target price on the stock. Zacks’ analyst wrote, “Phillips is a leading consumer electronics company. We are maintaining our Neutral recommendation on Phillips with a $33 target price. The company has reported profit for two consecutive quarters, sending earnings estimates higher over the past 30 days. Cost reduction plans and innovative product launches are helping the company’s growth strategy and are working in its favor. Furthermore, earnings increased 218% year over year and revenues were up 3% with all sectors performing well. The LED lighting segment is one of the growth factors for the company, contributing about 25% of the total lighting sales. Though the stock is yet to reach pre-recession price levels, it clearly is on the recovery path with bright growth prospects. “
QLogic Corp. (NASDAQ:QLGC) had its neutral rating reiterated by analysts at Zacks. They currently have a $11.00 target price on the stock. Zacks’ analyst wrote, “QLogic posted mixed first quarter 2014 results. Although earnings beat the Zacks Consensus Estimate, revenues lagged. Both earnings and revenues declined significantly on a year-over-year basis. The company’s results continue to suffer from the sluggish macro-economic environment. This will continue to hurt server sales in the near term, which drag top-line growth. Increasing competition is also expected to hurt profitability going forward. Nevertheless, we believe that the company will continue to benefit from contract wins from OEM’s in the near term. Moreover, innovative product pipeline, new technologies (Mt. Rainier) and additional savings from its restructuring initiatives will drive profitability going forward. Thus, we maintain our Neutral recommendation on QLogic and set a price target of $11.00. “
RenaissanceRe Holdings (NYSE:RNR) had its neutral rating reiterated by analysts at Zacks. They currently have a $96.00 price target on the stock. Zacks’ analyst wrote, “RenaissanceRe’s strength lies in its business expansion strategies, focus on core operations and premium growth. Although second-quarter earnings lagged the Zacks Consensus Estimate due to lower revenues and higher expenses lower share count led to year-over-year increase in earnings per share. However, total earnings, combined ratio and underwriting income also deteriorated. Moreover, the company recorded investment losses and lower cash balance. Meanwhile, the balance sheet improved with higher shareholder equity, and lower debt. The company will continue to face headwinds related to volatile investment income, high competition, and weather-related risks in the catastrophe insurance and reinsurance business. Nevertheless, strategic divestitures, efficient capital deployment via repurchase, dividend hikes, and stable ratings should enhance operating leverage. We maintain a Neutral recommendation on the stock.”
Questar Corp. (NYSE:STR) had its neutral rating reissued by analysts at Zacks. Zacks currently has a $24.00 price target on the stock. Zacks’ analyst wrote, “We believe Questar will be able to generate meaningful earnings and dividend growth in the coming years through strong operational performances by its business units. Other positives in the Questar story include its sole emphasis on the natural gas markets, its focus on long-term contracts and the efficient managerial team. An above-average credit quality adds to the bullish sentiment. However, we remain worried about the current volatile natural gas price environment that is likely to restrict near-term growth prospects at Questar Pipeline. This compels us to maintain our Neutral recommendation on Questar shares. We also believe that upside potential will remain limited until the company has fully reaped the benefits of the spin-off.”
Unum Group (NYSE:UNM) had its neutral rating reissued by analysts at Zacks. Zacks currently has a $32.00 price target on the stock. Zacks’ analyst wrote, “Unum’s second-quarter earnings surpassed the Zacks Consensus Estimate and the year-ago numbers. The improvement was driven by excellent risk results across its core operating segments. Unum came up with solid performances at the Unum U.S. and Colonial Life segment. The underperforming segments of the company are also approaching a gradual recovery. However, soft results at Unum U.K. remain a matter of concern. With $98 million share buybacks in the second quarter, Unum has bought back $2.4 billion over the last 5 years. Unum expects $500 million of repurchases in 2013. It also engages in consistent dividend payouts. However, performance at Unum U.K. has remained soft over the last few quarters. Also, low interest rate environment along with increasing debt burden keeps us cautious. We thus retain our Neutral recommendation on Unum.”
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