|By PR Newswire||
|April 17, 2014 09:30 AM EDT||
CHICAGO, April 17, 2014 /PRNewswire/ -- Zacks Equity Research highlights Rambus (Nasdaq:RMBS-Free Report) as the Bull of the Day and American Capital (Nasdaq:ACAS-Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis onPublic Service Enterprise Group Inc. (NYSE:PEG-Free Report), DTE Energy Company (NYSE:DTE-Free Report) and Edison International (NYSE:EIX-Free Report).
Here is a synopsis of all five stocks:
"There's no mentum like momentum." I know mentum isn't a word but you catch my drift. When a stock is consistently hitting new high after new high there is nothing like it. The market forces of accumulation continually push a stock to levels it hasn't seen before and shareholders are handsomely rewarded. Now find a stock that has positive momentum and a compelling earnings story during a tumultuous stock market and you have today's Bull of the Day.
Rambus (Nasdaq:RMBS-Free Report) is a semiconductor company that has been around for a while but has fallen off most people's radars. RMBS was a darling back in the days of the dot com bubble, trading as high as $135 before the bubble burst. Recently is has wallowed in the single digits until the tide turned in 2013. The semiconductor company is best known for making royalties from DRAM licensing. Good news for RMBS is the potential for new royalty streams from Qualcomm and Mediatek could range from $50 to $95 million per year. This would definitely be a big shot in the arm down the road.
Rambus is a Zacks Rank #1(Strong Buy) and owes that rating to its recent earnings surprises. Over the last four quarters RMBS has beat by an average of 14 per share each time. Last quarter was the most dramatic with RMBS earning 12 cents versus the consensus estimate for a 1 cent loss. The next earnings report is just around the corner, slated for April 21st. Recently, earnings estimates have been revised to the upside for the current year and next year. Current year consensus moved from a 5 cent loss to a 20 cent gain over the last 90 days. Current quarter estimates call for a 1 cent profit per share.
Let's find Zacks Rank #5 (Strong Sell) stocks with recent earnings disappointments, negative earnings revisions, and have underperformed the market. But I want to leave in stocks near their 52 week highs because maybe we are finding out something before the rest of the market is paying attention. I ran this screen today and came up with today's Bear of the Day.
American Capital (Nasdaq:ACAS-Free Report) Zacks Rank #5 (Strong Buy) in a specialty finance industry that ranks in the bottom 18% of our Zacks Industry Rank. ACAS is the only private equity fund and the largest alternative asset management company in the S&P 500. Earnings revisions recently have seen current year estimates drop from $1.10 to 92 cents and next year's numbers down from $1.41 to 92 cents. These downward revisions come on the heels of ACAS disappointing each of the prior four quarters by an average of 64.02%.
The price and consensus chart could be warning of tough times ahead for ACAS. The recent downturn in the earnings trend could be met with the stock giving up more than we have already seen. Currently the 2014 consensus is close to where it was in 2011 when the stock was trading nearly half where it's trading at today.
3 Utilities Your Portfolio Needs
Utility services play an integral role in the overall development of a country. Among these, power supply keeps the wheel of development rolling. As day-to-day activities seem unimaginable without power, cheap and consistent supply is a prerequisite.
As per a U.S. Energy Information Administration ("EIA") report, total energy use in the U.S. will increase to 107.6 quadrillion Btu in 2040 from 96.3 quadrillion Btu in 2013. Most of this demand is expected to come from the industrial sector followed by the commercial sector.
Greenhouse gas emission during electricity production is one of the biggest challenges faced by the operators. As the U.S. government started focusing on lowering emission and adoption of renewable generation standards in different states, operators too put on their thinking caps and gradually changed their generation mix.
The utilities are shifting loyalties and looking to natural gas and renewable sources for power generation. The proactive steps taken by these operators to harness new sources of energy for green power could take care of the environmental issues. For example, fuel cell technology could be the next big thing in the power generation industry.
Replete with bright prospects, the sector now perhaps offers solid investment opportunities. Stocks with the potential to beat earnings in the upcoming announcement should see faster price appreciation in the short term.
How to Pick the Right Stocks?
Choosing the correct stocks from numerous utility operators may appear an overwhelming task. This is where our proprietary methodology comes in handy. Stocks with the combination of a favorable Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) and a positive Zacks Earnings ESP are the ones that are likely to beat earnings estimates this announcement.
Earnings ESP is our proprietary methodology for determining stocks that have high chances of delivering earnings surprises in their next earnings announcement. It shows the percentage difference between the Most Accurate estimate and the Zacks Consensus Estimate. Our research shows that for stocks with this combination, the chance of a positive earnings surprise is as high as 70%.
Here are three utility stocks that are currently equipped with the right combination of elements to post an earnings beat.
Newark, NJ-based Public Service Enterprise Group along with its subsidiaries, is engaged in the generation and distribution of electricity and natural gas. The company primarily operates through its two subsidiaries, Public Service Electric and Gas Company (PSE&G) and PSEG Power LLC (Power).
Public Service Enterprise Group currently has $20.04 billion market capitalization and carries a Zacks Rank #1.The earnings ESP for the first quarter is 2.17%. The company surpassed Zacks Consensus Estimate in the last four quarters with an average beat of 7.82%.
Public Service Enterprise Group has a stable customer base spread across commercial, residential and industrial customer classes. The company invested $3.4 billion in five transmissions lines, spent on renewable power and energy efficiency programs. These initiatives will increase reliability and lower energy usage costs. Investment grade credit rating and strong cash flow generation capability will allow the company to fund these ongoing development programs and increase shareholder value.
Public Service Enterprise Group is scheduled to announce its first quarter financial results on April 29.
Detroit, MI-based DTE Energy through its subsidiaries is engaged in regulated and unregulated energy businesses. The company serves nearly 2.1 million electric and 1.2 million natural gas customers in Michigan.
DTE Energy currently has $13.61 billion market capitalization and carries a Zacks Rank #2. The earnings ESP for the first quarter 2014 is 18.31%. The company surpassed the Zacks Consensus Estimate in two out of four quarters with an average beat of 0.96%.
The company has been generating stable returns from its regulated electric and gas utilities in Michigan. Over the next five years, DTE Energy plans to invest $6.7 billion in electric and $1.2 billion in its gas operations.
The focus on increasing renewable power generation, strengthening infrastructure and boosting storage capacity and gas pipelines will allow it to serve an expanding customer base in an efficient manner. Improvement in the state's economy is also driving demand for utility services which will help DTE Energy to sustain its solid run.
DTE Energy is scheduled to announce its first quarter financial results on April 25.
Rosemead, CA-based Edison International through its subsidiaries is engaged in generation and distribution of electricity.
Edison International currently has $18.55 billion market capitalization and carries a Zacks Rank #2.The earnings ESP for the first quarter 2014 is 2.60%. The company surpassed the Zacks Consensus Estimate in the last four quarters with an average beat of 20.55%.
Edison International is focusing on improving its transmission and distribution lines by investing in the range of $15.1 billion to $17.2 billion for the 2014 to 2017 time period. The idea is to strengthen its infrastructure, increase reliability of services, lower operating costs and supply uninterrupted power to its different customer classes.
Edison International is scheduled to announce its first quarter financial results on April 29.
What Lies Ahead?
The need for uninterrupted essential supplies is the fundamental strength of the industry. Government regulations and new pollution standards have made these operators concentrate more on lesser polluting fuel sources to generate power. But the bottom line is that the demand for utilities can never turn obsolete.
For investors looking forward to a regular return on investment, dividend yield from all three utilities mentioned above are higher than industry average of 2.1%. Their stable earnings performance also offer solid reasons to explore the Utility space. Backed by a solid Zacks Rank and positive Zacks Earnings ESP, these could be great ideas for investors to gain from this earnings season.
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 analyst 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. Click here to 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
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
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.
"This week we're really focusing on scalability, asset preservation and how do you back up to the cloud and in the cloud with object storage, which is really a new way of attacking dealing with your file, your blocked data, where you put it and how you access it," stated Jeff Greenwald, Senior Director of Market Development at HGST, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
Jul. 24, 2016 05:45 AM EDT Reads: 1,357
When it comes to cloud computing, the ability to turn massive amounts of compute cores on and off on demand sounds attractive to IT staff, who need to manage peaks and valleys in user activity. With cloud bursting, the majority of the data can stay on premises while tapping into compute from public cloud providers, reducing risk and minimizing need to move large files. In his session at 18th Cloud Expo, Scott Jeschonek, Director of Product Management at Avere Systems, discussed the IT and busin...
Jul. 24, 2016 05:45 AM EDT Reads: 1,726
Keeping pace with advancements in software delivery processes and tooling is taxing even for the most proficient organizations. Point tools, platforms, open source and the increasing adoption of private and public cloud services requires strong engineering rigor – all in the face of developer demands to use the tools of choice. As Agile has settled in as a mainstream practice, now DevOps has emerged as the next wave to improve software delivery speed and output. To make DevOps work, organization...
Jul. 24, 2016 05:45 AM EDT Reads: 2,081
There will be new vendors providing applications, middleware, and connected devices to support the thriving IoT ecosystem. This essentially means that electronic device manufacturers will also be in the software business. Many will be new to building embedded software or robust software. This creates an increased importance on software quality, particularly within the Industrial Internet of Things where business-critical applications are becoming dependent on products controlled by software. Qua...
Jul. 24, 2016 05:30 AM EDT Reads: 1,286
"We formed Formation several years ago to really address the need for bring complete modernization and software-defined storage to the more classic private cloud marketplace," stated Mark Lewis, Chairman and CEO of Formation Data Systems, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
Jul. 24, 2016 05:30 AM EDT Reads: 1,428
SYS-CON Events has announced today that Roger Strukhoff has been named conference chair of Cloud Expo and @ThingsExpo 2016 Silicon Valley. The 19th Cloud Expo and 6th @ThingsExpo will take place on November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. "The Internet of Things brings trillions of dollars of opportunity to developers and enterprise IT, no matter how you measure it," stated Roger Strukhoff. "More importantly, it leverages the power of devices and the Interne...
Jul. 24, 2016 04:45 AM EDT Reads: 1,968
"There's a growing demand from users for things to be faster. When you think about all the transactions or interactions users will have with your product and everything that is between those transactions and interactions - what drives us at Catchpoint Systems is the idea to measure that and to analyze it," explained Leo Vasiliou, Director of Web Performance Engineering at Catchpoint Systems, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York Ci...
Jul. 24, 2016 04:45 AM EDT Reads: 1,864
Predictive analytics tools monitor, report, and troubleshoot in order to make proactive decisions about the health, performance, and utilization of storage. Most enterprises combine cloud and on-premise storage, resulting in blended environments of physical, virtual, cloud, and other platforms, which justifies more sophisticated storage analytics. In his session at 18th Cloud Expo, Peter McCallum, Vice President of Datacenter Solutions at FalconStor, discussed using predictive analytics to mon...
Jul. 24, 2016 04:30 AM EDT Reads: 1,919
Redis is not only the fastest database, but it is the most popular among the new wave of databases running in containers. Redis speeds up just about every data interaction between your users or operational systems. In his session at 19th Cloud Expo, Dave Nielsen, Developer Advocate, Redis Labs, will share the functions and data structures used to solve everyday use cases that are driving Redis' popularity.
Jul. 24, 2016 04:30 AM EDT Reads: 1,494
Most organizations prioritize data security only after their data has already been compromised. Proactive prevention is important, but how can you accomplish that on a small budget? Learn how the cloud, combined with a defense and in-depth approach, creates efficiencies by transferring and assigning risk. Security requires a multi-defense approach, and an in-house team may only be able to cherry pick from the essential components. In his session at 19th Cloud Expo, Vlad Friedman, CEO/Founder o...
Jul. 24, 2016 04:00 AM EDT Reads: 1,799
"We host and fully manage cloud data services, whether we store, the data, move the data, or run analytics on the data," stated Kamal Shannak, Senior Development Manager, Cloud Data Services, IBM, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
Jul. 24, 2016 03:45 AM EDT Reads: 1,137
With the proliferation of both SQL and NoSQL databases, organizations can now target specific fit-for-purpose database tools for their different application needs regarding scalability, ease of use, ACID support, etc. Platform as a Service offerings make this even easier now, enabling developers to roll out their own database infrastructure in minutes with minimal management overhead. However, this same amount of flexibility also comes with the challenges of picking the right tool, on the right ...
Jul. 24, 2016 02:45 AM EDT Reads: 901
As organizations shift towards IT-as-a-service models, the need for managing and protecting data residing across physical, virtual, and now cloud environments grows with it. Commvault can ensure protection, access and E-Discovery of your data – whether in a private cloud, a Service Provider delivered public cloud, or a hybrid cloud environment – across the heterogeneous enterprise. In his general session at 18th Cloud Expo, Randy De Meno, Chief Technologist - Windows Products and Microsoft Part...
Jul. 24, 2016 02:00 AM EDT Reads: 1,813
The Internet of Things will challenge the status quo of how IT and development organizations operate. Or will it? Certainly the fog layer of IoT requires special insights about data ontology, security and transactional integrity. But the developmental challenges are the same: People, Process and Platform. In his session at @ThingsExpo, Craig Sproule, CEO of Metavine, demonstrated how to move beyond today's coding paradigm and shared the must-have mindsets for removing complexity from the develo...
Jul. 24, 2016 01:30 AM EDT Reads: 1,133
SYS-CON Events announced today that MangoApps will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. MangoApps provides modern company intranets and team collaboration software, allowing workers to stay connected and productive from anywhere in the world and from any device.
Jul. 24, 2016 01:15 AM EDT Reads: 1,220