Zacks Equity Research highlights NTT DoCoMo, Inc. (NYSE: DCM) as the Bull of the Day and Banco Santander Central Hispano, S.A. (NYSE: STD) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Intellon Corporation (Nasdaq: ITLN), EOG Resources, Inc. (NYSE: EOG) and Orbcomm Inc. (Nasdaq: ORBC).
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: NTT DoCoMo, Inc. (NYSE: DCM)
Supported by its new customer pricing plan, NTT DoCoMo, the largest wireless service provider in Japan, declared respectable financial results for its first half of fiscal 2009 (ended September 30, 2008). The company's operating income increased 41% year-over-year, which offset a minor reduction in revenue.
DCM currently holds 51.5% share of the Japanese cellular market. The introduction of NTT DoCoMo's discount-priced service plans progressed as customer churn rates improved significantly. Stronger foreign currency rates, with respect to Yen against Dollar, have also raised valuation levels of DCM ADR shares.
Operationally, the company has upgraded 98% of its total coverage area with 3G HSDPA technologies and its emerging 4G LTE network is likely to be installed by 2010. We reiterate our Buy recommendation with a higher valuation target, as our assessment indicates improved financial performance due to technological superiority.
Bear of the Day: Banco Santander Central Hispano, S.A. (NYSE: STD)
We are cutting our rating on Banco Santander to Sell from Buy following the recent surprise announcement of a rights offering. On November 10, 2008, Santander stated that they would be issuing 1.599 billion new shares through a rights offering at a price of 4.50 per share for a total capital increase of 7.2 billion.
As a result, we are reducing our EPADS estimates $2.03 from $2.05 for 2008 and to $1.79 from $2.25 for 2009. The share increase combined with deteriorating economic conditions in Spain and appreciation of the US$ against the will likely depress Santander's share price over the near term.
Santander reported third quarter net earnings of 2.2 billion, up 6% year over year. The rise in nonperforming loans was the only sour note in an otherwise satisfactory performance, especially relative to European peers.
Latest Posts on the Zacks Analyst Blog:
Intellon Corporation (Nasdaq: ITLN)
Intellon is a fabless semiconductor company that designs, develops, manufactures, and markets integrated circuits (ICs) for powerline communications or high-speed communications over existing electrical wiring. September top- and bottom-line results met consensus estimates as home networks continue to grow.
Margins are trending up and we see the string of quarterly losses ending in the second half of 2008. The weak macro environment could provide a short-term tail wind as homeowners may upgrade home networks in lieu of taking vacations.
EOG Resources, Inc. (NYSE: EOG)
EOG Resources is a major independent oil and gas exploration and production company, with operations in the U.S., Canada, offshore Trinidad, and the U.K. North Sea. The company has historically concentrated on natural gas in preference to exploring for oil.
EOG's third-quarter earnings of $588.3 million were up sharply from the year-earlier level, driven by increased volumes and improved commodity-price realizations, partly offset by higher costs. Domestic natural gas production grew 20%, while liquids volumes rose 65% over last year.
Orbcomm Inc. (Nasdaq: ORBC)
Orbcomm, a leading provider of wireless (satellite) messaging services, declared third quarter 2008 financial results, in-line with our estimates. While we view the satellite business to be extremely competitive, not to mention low margin and expensive to operate, we also believe the barriers to entry for such services are substantial.
Should higher demand applications emerge, such barriers may lead Orbcomm to higher valuations. However, though original equipment manufacturer (OEM) customers and an increased subscriber base contributed to improved service revenues, the company's depleting cash position, coupled with weaker-than-expected cash from operations, may not be sufficient to fund capital spending objectives associated with emerging applications.
Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=2649.
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 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=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=4582.
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.
Contacts:
Mark Vickery
312-265-9380
Visit: www.zacks.com
