Research Analysts’ Ratings Reiterations for August, 27th (ABM, ADI, AEE, AGU, AVP, C, CBSH, COO, CZZ, DF)
ABM Industries (NYSE:ABM) had its neutral rating reaffirmed by analysts at Zacks. They currently have a $28.00 target price on the stock. Zacks’ analyst wrote, “ABM Industries’ second-quarter fiscal 2014 adjusted earnings miserably missed the Zacks Consensus Estimate despite record revenues. ABM Industries has realigned its operational structure to improve the long-term growth prospects and generate higher margin opportunities. The company expects to extend its global footprint and strengthen its position in existing markets through continuous acquisitions and organic growth across the industry verticals. However, soft global economic conditions could weigh on the margins moving forward. Moreover, intense competitive pressure and high integration and start-up costs are likely to peg back its profitability to some extent. Nevertheless, we maintain our Neutral recommendation on the stock. “
Analog Devices (NYSE:ADI) had its neutral rating reiterated by analysts at Zacks. Zacks currently has a $55.00 target price on the stock. Zacks’ analyst wrote, “Analog Devices is a leading supplier of analog and DSP integrated circuits. Its third quarter earnings were in-line with the Zacks Consensus Estimate and guidance was also encouraging. Though we remain concerned about competitive pressures across several markets, ADI is solidly positioned in secular growth markets and its products continue to see very strong deployment in the emerging automotive market. Given this backdrop, the order momentum in the last quarter is encouraging. We therefore reiterate our Neutral rating on the shares.”
Ameren Corp (NYSE:AEE) had its neutral rating reissued by analysts at Zacks. Zacks currently has a $41.00 price target on the stock. Zacks’ analyst wrote, “We are maintaining our Neutral recommendation on Ameren Corporation following the second quarter of 2014 results. In the reported quarter, the company’s earnings and revenues surpassed the Zacks Consensus Estimate, thanks to higher electricity and natural gas revenues. In addition, the decrease in operating and interest expenses also led to robust quarterly results. Both top as well as bottom line also increased year over year. The company’s favorable financial position allows it to pursue systematic capital investments in infrastructure development projects and installation of smart meters, thereby improving service reliability. Receiving rate-hike approvals from the commissions will encourage the company to invest more into growth ventures. However, stringent environmental regulations and several operational risks are disconcerting.”
Agrium (NYSE:AGU) had its neutral rating reaffirmed by analysts at Zacks. They currently have a $99.00 price target on the stock.
Avon Products (NYSE:AVP) had its neutral rating reissued by analysts at Zacks. The firm currently has a $15.00 target price on the stock. Zacks’ analyst wrote, “Persistent troubles at Avon resulted in another tough quarter, wherein both top and bottom lines for second-quarter 2014 fell shy of estimates. We remain concerned about the challenges hindering the company’s growth over the past few quarters. These include loss of active representatives, declining volume and unfavorable foreign currency translations, along with reduced margins in mature markets like North America. Moreover, weakness in the emerging markets, like China as well as regulatory and cash flow issues risking dividend are the other negatives. Despite all these adverse factors we have maintained our Neutral recommendation as the company has displayed signs of improving fundamentals of late. We note that Avon has been making significant progress in improving its balance sheet through refinancing activities and cutting costs by slashing jobs and exiting operations in the underperforming markets.”
Citigroup (NYSE:C) had its neutral rating reiterated by analysts at Zacks. Zacks currently has a $55.00 target price on the stock. Zacks’ analyst wrote, “Continuing the positive note, Citigroup reported impressive second-quarter 2014 results. Adjusted earnings surpassed the Zacks Consensus Estimate. However, earnings were below the year-ago figure. Notably, prior to the earnings release, Citigroup struck a deal with the U.S. Department of Justice (DOJ), several state attorneys general (State AGs) and the Federal Deposit Insurance Corporation (the FDIC) worth $7 billion. Though revenues declined, on the whole, its profit level outpaced expectations. We believe the company’s global footprint and attractive core business are impressive. Yet, a low interest-rate environment and regulatory issues along with litigation risks remain headwinds. Considering the tepid economic recovery and expected slump in trading revenues, we believe that robust top-line expansion will remain elusive in the near term.”
Commerce Bancshares (NASDAQ:CBSH) had its neutral rating reiterated by analysts at Zacks. Zacks currently has a $48.50 price target on the stock. Zacks’ analyst wrote, “Commerce Bancshares’ second-quarter 2014 earnings outpaced the Zacks Consensus Estimate. Steady improvement in revenues and growth in loans and deposits were the favorable factors. On the other hand, elevated operating expense and provision for loan losses continue to be causes of concern. We believe the company has healthy growth prospects on the back of a sound capital base and strong liquidity level. Also, the company’s enhanced capital deployment activities and inclination towards inorganic growth will work in its favor going forward. However, the company’s failure to curb expenses which may get further aggravated by stringent regulatory requirements along with the prevailing low interest rate environment as well as sluggish economic recovery will likely keep the financials under pressure in the near term.”
The Cooper Companies (NYSE:COO) had its neutral rating reissued by analysts at Zacks. Zacks currently has a $171.00 target price on the stock. Zacks’ analyst wrote, “The Cooper Companies’ fiscal 2014-second quarter earnings rose 9.3% to $1.64 and topped the Zacks Consensus Estimate by $0.03. Its revenues of $412.3 million grew 7.4% and were in line with the benchmark. We are encouraged by the company’s upgraded earnings guidance and stable revenues outlook for fiscal 2014. The contact lens unit is growing at above-market growth rates. Cooper has significant market share in high growth specialty lenses. However, markets in Europe are weak and discretionary spending is still weak. Near term issues emanating from a weak economy, such as lower purchase sizes plague the company. We maintain our recommendation on Cooper at Neutral and set a target of $171.00.”
Cosan Limited (NYSE:CZZ) had its neutral rating reaffirmed by analysts at Zacks. They currently have a $13.00 price target on the stock. Zacks’ analyst wrote, “Cosan’s second-quarter 2014 net income was R$104 million versus a loss of R$202 million in the year-ago quarter. Revenues inched up 0.9% as higher fuel sales were partially offset by a decline in sugar sales. Sugarcane crushing increased 13% while sugar production rose 13.7%. Energy cogeneration revenues soared 108% while Transportation revenues were down 20%. For 2014, management maintained EBITDA guidance in the R$4.15-R$4.65 billion range. Also, the proposed Rumo-ALL merger will enable Cosan to gain an easy access to ALL’s transportation services. However, rising costs and expenses, adverse impacts of unfavorable weather conditions and higher debt levels might impede the company’s growth. Considering these, we maintain a Neutral recommendation on Cosan.”
Dean Foods (NYSE:DF) had its underperform rating reaffirmed by analysts at Zacks. Zacks currently has a $15.00 price target on the stock. Zacks’ analyst wrote, “Dean Foods displayed disappointing performance in yet another quarter wherein high raw milk prices dragged the company’s second-quarter 2014 bottom-line results. The company posted an adjusted loss of $0.14 per share from continuing operations contrary to adjusted earnings of $0.26 in the year-ago comparable quarter. Moreover, adjusted loss was wider than the Zacks Consensus Estimate of a loss of $0.05 per share. Gauging current industry trends, Dean Foods expects higher raw milk prices and weak volumes in 2014. Hence, the company withdrew its earnings guidance for 2014 and provided a dismal guidance for the third quarter. We believe the inflationary commodity environment and competitive pressures will continue to weigh on the company’s performance in 2014. Therefore, our long-term Underperform recommendation prevails.”
Edwards Lifesciences Corp (NYSE:EW) had its neutral rating reaffirmed by analysts at Zacks. They currently have a $104.00 target price on the stock. Zacks’ analyst wrote, “Edwards posted an impressive second-quarter 2014 with adjusted EPS of $0.88, which steered ahead of the Zacks Consensus Estimate by a huge $0.11 and was up 4.8% year over year. Sales of $575.1 million were up 11.2% beating the Zacks Consensus Estimate of $546 million. The company continues to remain in the headlines with several positive takeaways in the second quarter including positive results for SAPIEN 3 and the launch of SAPIEN XT in the U.S. But with the U.S. launch of Sapien XT, Edwards is now well positioned to continue strengthening its foothold in the U.S. THV market. Sales growth across the structural heart valve therapy group was also encouraging. Edwards also reported meaningful margin expansion in the quarter. Despite a competitor’s product launch, things are gradually working in favor of Edwards with an expected rebound in the next quarter. We thus reiterate the stock at Neutral.”
Microsoft (NASDAQ:MSFT) had its neutral rating reissued by analysts at Zacks. Zacks currently has a $47.00 target price on the stock. Zacks’ analyst wrote, “Microsoft is one of the largest software companies in the world. Its operating systems are installed on the majority of computers anywhere in the world. It is also a leader in the emerging cloud computing market. Fiscal fourth quarter 2014 earnings missed the Zacks Consensus Estimate. The reorganization of the business and “cloud-first mobile-first” focus are encouraging, but execution risks are considerable. Additionally, competition remains stiff and Microsoft’s dominant position in the PC market continues to be challenged by new-age devices. However, considering the fact that the enterprise refresh cycle, new subscription model, Azure and promising new products will continue to generate sizeable cash flows, we are reiterating our Neutral recommendation on Microsoft shares.”
Monster Worldwide (NYSE:MWW) had its neutral rating reissued by analysts at Zacks. They currently have a $6.00 target price on the stock.
SunTrust (NYSE:STI) had its neutral rating reaffirmed by analysts at Zacks. They currently have a $40.00 price target on the stock. Zacks’ analyst wrote, “SunTrust’s second-quarter 2014 earnings were well ahead of the Zacks Consensus Estimate, driven by growth in revenue and fall in provision for credit losses. These were, however, partially offset by a rise in operating expenses. We believe that improving credit quality and a favorable deposit mix will continue to remain the driving forces at SunTrust. Moreover, the consistent capital deployment activities will boost shareholders’ confidence going forward. Further, efficient cost-containment efforts amid a sluggish economic recovery seem encouraging as well. Nevertheless, we remain concerned about the company’s subdued top-line growth, exposure to risky assets and continued regulatory pressures.”
Wells Fargo & Co. (NYSE:WFC) had its neutral rating reiterated by analysts at Zacks. The firm currently has a $54.00 price target on the stock. Zacks’ analyst wrote, “Wells Fargo’s second-quarter 2014 earnings outpaced the Zacks Consensus Estimate though it was in line with the prior-year quarter earnings. Results reflected growth in total loans and deposits amid a challenging economy and disciplined expense management. However, the company experienced a fall in non-interest income. In the long term, we remain optimistic about the company, based on its diverse geographic and business mix. Strategic acquisitions and a solid capital position are expected to improve profitability going forward. Yet, we believe top-line headwinds would persist, given the protracted economic recovery. The company’s unrelenting legacy mortgage issues and regulatory pressure also remain concerns.”
Xylem (NYSE:XYL) had its neutral rating reaffirmed by analysts at Zacks. They currently have a $40.00 price target on the stock. Zacks’ analyst wrote, “Xylem reported impressive results for the second quarter of 2014, with adjusted earnings rising 33% year over year to $0.48 per share. Revenues for the quarter climbed 4.7% year over year, driven by an improvement in the emerging markets along with modest growth in the U.S. and Europe. Lately, the company has been leveraging inorganic growth strategies to expand its operational footprint. However, international presence exposes the company to foreign currency translation risks. Additionally, increasing use of cash for technological innovations poses the threat of losses in the event of any research failure. Based on the above factors, we prefer to remain on the sidelines and maintain a Neutral recommendation on the stock.”
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