Analysts’ Ratings Reiterations for October, 10th (AA, ACR.UN, AES, AMRN, CERN, DECK, DFRG, DGX, DVA, EXC)
Alcoa (NYSE:AA) had its neutral rating reissued by analysts at Zacks. They currently have a $8.50 price target on the stock.
Agellan Commercial Reit (TSE:ACR.UN) had its buy rating reiterated by analysts at Laurentian. Laurentian currently has a C$11.00 price target on the stock.
AES Corp. (NYSE:AES) had its neutral rating reiterated by analysts at Zacks. They currently have a $14.00 price target on the stock. Zacks’ analyst wrote, “We maintain our Neutral recommendation on AES Corp. The company has a diversified presence in many key markets that insulates it from any region-specific risk. The company is investing substantially on capacity expansion in the power hungry regions of Latin America and Asia and working on new projects to leverage strategic relationships and maximize its return. Key growth drivers for the company are its cash deployment strategy and cost control initiatives. However, a low dividend yield and high capital expenditures that the company would incur for installation of more clean energy generating plants keep us concerned. Also, long-term supply contracts expose the company to commodity price risk.”
Amarin Co. plc (NASDAQ:AMRN) had its positive rating reiterated by analysts at Jefferies Group. The analysts wrote, “We outline several reasons why we remain positive on near term approval prospects for the Vascepa ANCHOR indication in advance of the advisory committee meeting set for October 16 and the expected release of the FDA’s briefing documents on Friday (October 11). The ANCHOR Indication of mixed dyslipidemia is critical for long-term Vascepa sales growth and we view it as central to our AMRN Buy thesis.”
Cerner Corp. (NASDAQ:CERN) had its buy rating reaffirmed by analysts at KeyCorp. KeyCorp currently has a $62.00 price target on the stock, up from their previous price target of $60.00. The analysts wrote, “In our view, Cerner has gained substantial credibility in revenue cycle in the context of its recent enterprise deals at Adventist Health (March 2013) and Intermountain Healthcare (September 2013). The Adventist relationship appears to be bearing fruit from a development standpoint with the pending release of modules in 1) contract management and 2) computer assisted coding. Moreover, Cerner has gained ground with its Millennium based care management offering with deployments now at ~92 hospitals (~70 under contract). Population health remains a focus of development with the expected roll-out of a new portal in 1H14 with incremental patient education and wellness capabilities from the recent PureWellness acquisition. Also, Cerner has grown its predictive modeling with its investments in the HP Vertica Analytics Platform, which is accelerating learnings at CernerMath. CernerMath has now built roughly nine models.”
Deckers Outdoor Corp. (NASDAQ:DECK) had its underperform rating reiterated by analysts at Credit Suisse. The analysts wrote, “We remain concerned about Deckers’ return on recent retail investments and reiterate our view that 2H earnings could fall short of expectations. While 3Q remains a sell-in quarter, and risk is moderate heading into the 3Q report, recent retailer commentary and macroeconomic factors suggest the company is not well positioned for guided-to reacceleration of revenue growth and earnings power in 4Q. Guidance is for 4Q revenue growth of 14.5%, and EPS growth of 38% versus 2.5% revenue growth and earnings declines of 41% Y/Y in 3Q.”
Del Frisco’s Restaurant Group (NASDAQ:DFRG) had its buy rating reissued by analysts at Deutsche Bank. Deutsche Bank currently has a $24.00 price target on the stock.
Quest Diagnostics (NYSE:DGX) had its market perform rating reiterated by analysts at Wells Fargo & Co..
DaVita HealthCare Partners (NYSE:DVA) had its neutral rating reaffirmed by analysts at Zacks. The firm currently has a $60.00 target price on the stock. Zacks’ analyst wrote, “We reiterate our Neutral recommendation on DaVita HealthCare following the second quarter earnings that lagged the Zacks Consensus Estimate but surpassed the prior-year quarter’s earnings. Strong revenues and a higher number of treatments were partially offset by higher expenses. The balance sheet also improved with lower debt and higher shareholder equity. Moreover, higher cash flow, rapidly expanding international presence and an active domestic acquisition strategy are the other positive factors. However, high dependence on commercial payors and government reimbursements raise concerns. Overall, an improved outlook for the remainder of 2013 and the merger with HealthCare Partners provide optimism for the near and long term. “
Exelon Corp. (NYSE:EXC) had its neutral rating reiterated by analysts at Zacks. The firm currently has a $31.00 target price on the stock. Zacks’ analyst wrote, “Exelon Corporation posted soft second-quarter 2013 results with earnings and revenues below the Zacks Consensus Estimate. Earnings also declined year over year due to higher operating expenses. However, going forward key growth drivers for the company include its solid utility operations and the initiatives taken by it to increase production through renewable sources. Also, the Constellation Energy Nuclear Group’s integration with Exelon Generation allows the company to take advantage of additional synergies. However, we prefer to remain on the sidelines based on the company’s second-quarter performance and increased regulatory landscape. We maintain our Neutral recommendation on the stock.”
Fastenal (NASDAQ:FAST) had its neutral rating reissued by analysts at Zacks. Zacks currently has a $49.00 price target on the stock. Zacks’ analyst wrote, “Fastenal’s third-quarter 2013 earnings of $0.40 per share missed the Zacks Consensus Estimate by a penny, but grew 8.1% year over year, attributable to decent margin growth. Revenues grew 7.0% year over year, but missed the Zacks Consensus Estimate hurt by soft fastener sales and weakness in construction. Fastenal’s daily sales growth rates have been weak for the past few quarters mainly due to weakness in its fastener product line. Vending was also soft in the quarter. However, management’s strategy of slowing down vending pace and instead focus on improving near-term sales sounds encouraging. Moreover, the strategic decision to slow down store growth and instead increase headcount will drive near-term sales growth. We are also encouraged by Fastenal’s other growth drivers like government business and metalworking, which are gaining traction. We therefore, have a Neutral recommendation on the stock with a target price of $49.00. “
Medicines (NASDAQ:MDCO) had its outperform rating reiterated by analysts at Leerink Swann. The firm currently has a $42.00 target price on the stock, up from their previous target price of $40.00. The analysts wrote, “At today’s analyst meeting, MDCO reviewed the status of its ongoing Angiomax patent litigation and highlighted the robust growth and diversification opportunities presented by its burgeoning interventional cardiology and hospital product pipeline. MDCO expects revenues to grow at a CAGR of >20% from 2014-2018, and we are updating our model to include $150MM in peak Fibrocaps sales in 2025 and a top-line growth rate of ~20% for the next 5 years. Reit. OP on MDCO; raising our PT to $42 from $40.”
Magellan Health Services (NASDAQ:MGLN) had its buy rating reaffirmed by analysts at Deutsche Bank. They currently have a $65.00 target price on the stock.
Marathon Oil Corp. (NYSE:MRO) had its neutral rating reaffirmed by analysts at Zacks. They currently have a $36.00 target price on the stock. Zacks’ analyst wrote, “We are maintaining our Neutral recommendation on Marathon Oil stock, reflecting its sustainable growth prospects and outlook. Marathon is a leading energy firm with a large and geographically-diverse reserve base and solid project pipeline. Additionally, the company possesses a healthy balance sheet, which helps it to capitalize on investment opportunities. We also like the strong growth potential of Marathon’s high-margin liquids-rich unconventional plays, which diversify its portfolio and are expected to further drive its overall volumes. While being incrementally more positive on the company, we believe Marathon will take some time to fully absorb the outcome of the spin-off of its downstream business. Consequently, we would rather wait for a better entry point before accumulating shares.”
Oneok Partners LP (NYSE:OKS) had its neutral rating reissued by analysts at Zacks. The firm currently has a $54.00 price target on the stock. Zacks’ analyst wrote, “ONEOK Partners L.P.’s earnings per unit and revenues in the second quarter of 2013 surpassed the Zacks Consensus Estimates primarily due to higher natural gas volumes gathered, compressed, processed, transported and sold as a result of increase in well connections. This was partially offset by narrower natural gas liquids (NGL) price differentials and continuous decline in NGL optimization margins. ONEOK Partners’ geographically diversified asset base, stable liquidity position, strong projects pipeline, completion of several projects and acquisitions strategy should boost its future performance. On the flip side, volatile commodity pricing and stringent utility regulations make us cautious. Hence, we maintain our Neutral recommendation on the stock.”
Rent-A-Center (NASDAQ:RCII) had its neutral rating reissued by analysts at Zacks. Zacks currently has a $38.00 target price on the stock.
TELUS (NYSE:TU) had its neutral rating reaffirmed by analysts at Zacks. They currently have a $35.00 price target on the stock. Zacks’ analyst wrote, “We maintain our Neutral recommendation on Telus. We believe that the company has strong prospects in the Wireless segment backed by technology upgrades, high rollout of smartphones and expansion of the 4G LTE network. The company’s investments in Internet data centers and Optik TV business are expected to reap results in the near future. Going forward, investments in high speed broadband technology and services as well as introduction of shared data plans will likely work in favor of Telus. However, these positives are somewhat mitigated by continuous access lines erosion coupled with economic instability in Canada. In addition, heightened competition from national as well as regional players and spectrum issues are major impediments that need to be addressed in the coming days.”
VMware (NYSE:VMW) had its neutral rating reiterated by analysts at Piper Jaffray Cos.. The analysts wrote, “VMware competitor Citrix announced preliminary Q3 results, guiding revenue and earnings below expectations. As a reminder, our recent work has shown that VMware’s View product is rapidly gaining share and would likely cause problems for Citrix. Our last few VMW notes (including July 23 and September 4) highlighted industry feedback indicating VMware is much more competitive with Citrix and likely taking share. VMware resellers had noted Citrix customers approaching them ‘more and more’, stated that traction in VMware’s desktop virtualization solution (View) is ‘exploding’ and that VMware has closed a significant portion of the competitive gap between View and the Citrix desktop virtualization offering. We think VMW’s inroads have caught up to Citrix and contributed to the negative preannouncement, and VMW’s progress should be appreciated by investors, but believe VMW is fairly valued for now at a low 20s EPS multiple. Neutral, $87 PT.”
Western Digital Corp. (NYSE:WDC) had its neutral rating reaffirmed by analysts at Zacks. Zacks currently has a $66.00 price target on the stock. Zacks’ analyst wrote, “Although Western Digital’s fourth-quarter revenues and earnings beat the Zacks Consensus Estimate, both were down on a year-over-year basis. We believe that the secular growth of digital data and growing exposure to the small and medium business space remain positives for the company. Additionally, WDC is rolling out new storage devices to increase penetration in the cloud. However, increased innovation has resulted in higher R&D expenses, which may lead to flat margins. Moreover, competition from its peers and a sluggish macro economic environment could pose headwinds for the company. Thus, we reiterate our Neutral recommendation on Western Digital and set a price target of $66.00.”
Yum! Brands (NYSE:YUM) had its neutral rating reaffirmed by analysts at Zacks. They currently have a $70.00 target price on the stock. Zacks’ analyst wrote, “Yum! posted lackluster third-quarter results. The company’s third-quarter 2013 adjusted earnings of $0.85 per share missed the Zacks Consensus Estimate by 8.6% and the year-ago quarter’s earnings by 15%. Earnings in the quarter were under pressure due to the decrease in top line, lower margin and higher tax rate. Total revenue declined 3% year over year to $3.47 billion and also fell short of the Zacks Consensus Estimate by nearly 2.0%. Once again, weak performance by the China Division led to the lackluster results. China’s comps declined 11% in the quarter due to continuing unfavorable impact of the poultry supply issue. A weak earnings outlook is concerning for the company. However, Yum! has a proven business model, which has survived similar threats in the past. Further, Yum! remains relatively well-positioned in the YRI and India segments. Management expects double-digit growth in earnings from 2014 onwards. Hence, we remain Neutral on the stock.”
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