|By PR Newswire||
|July 5, 2013 09:30 AM EDT||
CHICAGO, July 5, 2013 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Desarrolladora Homex, SAB de CV (NYSE:HXM-Free Report), Grupo Aeroportuario del Pacifico S.A.B. de CV (NYSE:PAC-Free Report), America Movil S.A.B. de C.V. (NYSE:AMX-Free Report), CEMEX, S.A.B. de C.V. (NYSE:CX-Free Report) and MDC Holdings Inc. (NYSE:MDC-Free Report).
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
Here are highlights from Wednesday's Analyst Blog:
Fed Taper Mayhem: 2 Mexican Stocks to Buy
They say, "When the U.S. sneezes, the rest of the world catches a cold," and this seems to have proved true for an emerging market like Mexico, the second largest economy in Latin America. As the Fed kept faltering to taper QE, the Mexican peso witnessed a roller-coaster ride in both the bond and stock markets.
As things settled down after a week-long frenzy, it is time now to cherry pick some Mexican stocks. But before we zero-in on which ones to buy, let's have a recap of the vagaries in the Mexican economy.
The Rise of the Mexican Peso
With its close ties to the U.S., Mexican assets – like the relatively stable high-yielding government bonds – have been one of the most lucrative investment propositions for investors to leverage cheap loans in developed countries. Consequently, there was a significant inflow of funds into the economy as foreign holdings of peso debt amplified six-fold since 2009 to $1.75 trillion pesos ($136 billion) in Apr 2013.
Booming investor confidence triggered by a highly liquid market and hands-off attitude by officials steered the peso to a 4.3% return in 2013 till mid-May – the best performance among 16 major currencies tracked by Bloomberg. The economy was further buoyed by a reform push by the newly-formed government and a record-low benchmark interest rate of 4% by the Bank of Mexico (Banco de Mexico). Bonds and stocks kept scaling newer highs as Mexico gradually became the blue-eyed boy among investors.
The Ignominious Fall
On Jun 19, Fed Chairman Ben Bernanke announced his intentions to start tapering and gradually phase out its $85 billion monthly bond-buying program by 2014. Although the announcement indicated an overall improvement in the U.S. financial system and dialed down the need for any additional stimulus, it ruffled the dynamics of several economies, including Mexico.
This led to a near stampede as foreign investors rushed for the exit door and some of the worst sell-offs of Mexican bonds since 2010. With speculations being rife about Fed tapering since early May, the Mexican peso plummeted from below 12 per dollar to over 13, while the benchmark ten-year bonds rose from a historic low of 4.4% to 6.2%. Even Mexican Bolsa IPC Index, the Mexican Stock Exchange, had an uncharacteristically sharp fall to close at a 52-week low.
A drastic fall in the currency and heavy outflow of capital have catapulted expectations of a further lowering of interest rates for a second time this year. At the same time, experts believe that in order to prevent further fall, the government can bring in some radical reforms by opening up the energy sector, which is considered to be one of the vital pillars for augmenting the long-term growth potential of the country.
On the other hand, some industry observers opine that subsequent Fed tapering could be a "winner's curse" for Mexico as they largely depend on the U.S. economy, which account for almost 80% of its total exports. So an overall improvement in the underlying growth factors for its northern neighbor would indeed work in favor of long-term gains. Thus, would it be fair to wish to delay the inevitable for short-term profit?
As markets have more or less stabilized, with reports of weaker U.S. GDP growth forcing the Fed to reconsider its decision and continue with the bond-buying program, it is deja vu for investors all over again. In this context, top Mexican stocks with attractive valuation metrics backed by a solid Zacks Rank methodology include home developer Desarrolladora Homex, SAB de CV (NYSE:HXM-Free Report) and airport manager Grupo Aeroportuario del Pacifico S.A.B. de CV (NYSE:PAC-Free Report).
Both of these stocks hold a Zacks Rank #2 (Buy). While Desarrolladora Homex has a forward P/E and long-term earnings expectation of 1.52 and 13.15%, respectively; Grupo Aeroportuario has respective tallies of 19.67 and 9.37%.
We also suggest a couple of Zacks Rank #3 (Hold) stocks – America Movil S.A.B. de C.V. (NYSE:AMX-Free Report) and CEMEX, S.A.B. de C.V. (NYSE:CX-Free Report) – as they are expected to post robust earnings growth of 8.34% and 18.98%, respectively.
Even some hedge funds are bullish on the Mexican peso and anticipate the recently-found optimism to continue through year's end. As fundamentals look strong, the market is getting flocked by a huge pool of investors, creating short-term noises and long-term opportunities. Only time will tell whether such investor confidence is justifiable or not.
MDC Holdings Upped to Strong Buy
On Jul 2, Zacks Investment Research upgraded MDC Holdings Inc. (NYSE:MDC-Free Report) to a Zacks Rank #1 (Strong Buy) on the back of growing momentum in the homebuilding market and a bright industry outlook for the year.
Why the Upgrade?
MDC Holdings is benefiting from the increase in demand for new homes, a fact supported by most of the housing data released recently.
The housing market has seen significant upside in new home construction activity, which is fueled by the increase in demand for new homes. Despite recent increase in mortgage rates, the housing market continues to witness momentum, indicating stable recovery. Increased affordability due to higher rentals is boosting demand. Supply, however, remains limited due to low inventories, both for new and existing homes. Home prices have thus moved up sharply with increased market demand and limited supply.
Most homebuilders like MDC Holdings are thus, witnessing increasing traffic levels due to heightened consumer demand. Majority of the companies are witnessing significant growth in both volumes and average selling prices. MDC Holdings has recorded high double digit earnings surprises for the past seven quarters. Its average surprise for the past four quarters is 74.42%.
The strong housing momentum has also been reflected in MDC Holdings' solid first quarter results (ended Mar 31) reported on May 2, 2013. Its first quarter fiscal 2013 adjusted earnings per share and total revenue beat the Zacks Consensus Estimate and the prior-year quarter levels by a wide margin. The beat was driven by high double digit year-over-year growth in new home orders, backlogs, home closings and margin expansion. The company was also able to increase average selling price of the homes sold by 9%.
MDC Holdings is due to report its fiscal second quarter 2013 results in late Jul/early Aug. The Zacks Consensus Estimate at the moment is pegged at 55 cents per share.
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
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.
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978. The later formation of the Zacks Rank, a proprietary stock picking system; 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.
Follow us on Twitter: http://twitter.com/zacksresearch
Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Zacks Investment Research
800-767-3771 ext. 9339
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
SOURCE Zacks Investment Research, Inc.
Too often with compelling new technologies market participants become overly enamored with that attractiveness of the technology and neglect underlying business drivers. This tendency, what some call the “newest shiny object syndrome,” is understandable given that virtually all of us are heavily engaged in technology. But it is also mistaken. Without concrete business cases driving its deployment, IoT, like many other technologies before it, will fade into obscurity.
Sep. 2, 2015 12:15 PM EDT Reads: 406
Mobile, social, Big Data, and cloud have fundamentally changed the way we live. “Anytime, anywhere” access to data and information is no longer a luxury; it’s a requirement, in both our personal and professional lives. For IT organizations, this means pressure has never been greater to deliver meaningful services to the business and customers.
Sep. 2, 2015 12:00 PM EDT Reads: 813
Akana has announced the availability of the new Akana Healthcare Solution. The API-driven solution helps healthcare organizations accelerate their transition to being secure, digitally interoperable businesses. It leverages the Health Level Seven International Fast Healthcare Interoperability Resources (HL7 FHIR) standard to enable broader business use of medical data. Akana developed the Healthcare Solution in response to healthcare businesses that want to increase electronic, multi-device acce...
Sep. 2, 2015 12:00 PM EDT Reads: 266
17th Cloud Expo, taking place Nov 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA, will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud strategy. Meanwhile, 94% of enterprises ar...
Sep. 2, 2015 12:00 PM EDT Reads: 1,558
Amazon and Google have built software-defined data centers (SDDCs) that deliver massively scalable services with great efficiency. Yet, building SDDCs has proven to be a near impossibility for ‘normal’ companies without hyper-scale resources. In his session at 17th Cloud Expo, David Cauthron, founder and chief executive officer of Nimboxx, will discuss the evolution of virtualization (hardware, application, memory, storage) and how commodity / open source hyper converged infrastructure (HCI) so...
Sep. 2, 2015 12:00 PM EDT Reads: 120
In today's digital world, change is the one constant. Disruptive innovations like cloud, mobility, social media, and the Internet of Things have reshaped the market and set new standards in customer expectations. To remain competitive, businesses must tap the potential of emerging technologies and markets through the rapid release of new products and services. However, the rigid and siloed structures of traditional IT platforms and processes are slowing them down – resulting in lengthy delivery ...
Sep. 2, 2015 11:45 AM EDT Reads: 615
The 3rd International WebRTC Summit, to be held Nov. 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA, announces that its Call for Papers is now open. Topics include all aspects of improving IT delivery by eliminating waste through automated business models leveraging cloud technologies. WebRTC Summit is co-located with 15th International Cloud Expo, 6th International Big Data Expo, 3rd International DevOps Summit and 2nd Internet of @ThingsExpo. WebRTC (Web-based Real-Time Com...
Sep. 2, 2015 11:45 AM EDT Reads: 1,545
In 2014, the market witnessed a massive migration to the cloud as enterprises finally overcame their fears of the cloud’s viability, security, etc. Over the past 18 months, AWS, Google and Microsoft have waged an ongoing battle through a wave of price cuts and new features. For IT executives, sorting through all the noise to make the best cloud investment decisions has become daunting. Enterprises can and are moving away from a "one size fits all" cloud approach. The new competitive field has ...
Sep. 2, 2015 11:45 AM EDT Reads: 103
WebRTC services have already permeated corporate communications in the form of videoconferencing solutions. However, WebRTC has the potential of going beyond and catalyzing a new class of services providing more than calls with capabilities such as mass-scale real-time media broadcasting, enriched and augmented video, person-to-machine and machine-to-machine communications. In his session at @ThingsExpo, Luis Lopez, CEO of Kurento, will introduce the technologies required for implementing thes...
Sep. 2, 2015 11:45 AM EDT
SYS-CON Events announced today the Containers & Microservices Bootcamp, being held November 3-4, 2015, in conjunction with 17th Cloud Expo, @ThingsExpo, and @DevOpsSummit at the Santa Clara Convention Center in Santa Clara, CA. This is your chance to get started with the latest technology in the industry. Combined with real-world scenarios and use cases, the Containers and Microservices Bootcamp, led by Janakiram MSV, a Microsoft Regional Director, will include presentations as well as hands-on...
Sep. 2, 2015 11:30 AM EDT Reads: 379
The 17th International Cloud Expo has announced that its Call for Papers is open. 17th International Cloud Expo, to be held November 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA, brings together Cloud Computing, APM, APIs, Microservices, Security, Big Data, Internet of Things, DevOps and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding bu...
Sep. 2, 2015 11:30 AM EDT Reads: 1,627
Enterprises can achieve rigorous IT security as well as improved DevOps practices and Cloud economics by taking a new, cloud-native approach to application delivery. Because the attack surface for cloud applications is dramatically different than for highly controlled data centers, a disciplined and multi-layered approach that spans all of your processes, staff, vendors and technologies is required. This may sound expensive and time consuming to achieve as you plan how to move selected applicati...
Sep. 2, 2015 11:30 AM EDT
With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo in Silicon Valley. Learn what is going on, contribute to the discussions, and ensure that your enterprise is as "IoT-Ready" as it can be! Internet of @ThingsExpo, taking place Nov 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 17th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading in...
Sep. 2, 2015 11:30 AM EDT Reads: 1,995
With the proliferation of connected devices underpinning new Internet of Things systems, Brandon Schulz, Director of Luxoft IoT – Retail, will be looking at the transformation of the retail customer experience in brick and mortar stores in his session at @ThingsExpo. Questions he will address include: Will beacons drop to the wayside like QR codes, or be a proximity-based profit driver? How will the customer experience change in stores of all types when everything can be instrumented and a...
Sep. 2, 2015 11:15 AM EDT Reads: 493
The 5th International DevOps Summit, co-located with 17th International Cloud Expo – being held November 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA – announces that its Call for Papers is open. Born out of proven success in agile development, cloud computing, and process automation, DevOps is a macro trend you cannot afford to miss. From showcase success stories from early adopters and web-scale businesses, DevOps is expanding to organizations of all sizes, including the ...
Sep. 2, 2015 11:15 AM EDT Reads: 1,610