For Immediate Release
Chicago, IL – March 25, 2010 – Zacks Equity Research highlights Gentiva Health Services Inc. (GTIV) as the Bull of the Day and Everest Re (RE) the Bear of the Day. In addition, Zacks Equity Research provides analysis on Fortune Brands (FO), Masco (MAS) and USG (USG).
Full analysis of all these stocks is available at http://at.zacks.com/?id=5506
Here is a synopsis of all five stocks:
Gentiva Health Services Inc. (GTIV) reported a fourth-quarter (ended January 3, 2010) income (excluding special items) of $0.63 per share, surpassing the Zacks Consensus Estimate by 9 cents.
Gentiva is a leading provider of home health and hospice services. It delivers innovative, high-quality care to patients across the United States. The company boasts of a diversified product portfolio. Gentiva serves patients in more than 300 locations across 39 states. The company has successfully grown through acquisitions.
During the past few years, the company has completed multiple acquisitions which have expanded its reach further. Gentiva continues to look for profitable acquisitions. Consequently, we upgrade the stock to Outperform.
We are downgrading our recommendation on Everest Re (RE) to Underperform. The company recently announced its initial loss estimates from the earthquake in Chile and the European Windstorm Xynthia. The losses are substantial.
Also, the company’s fourth quarter earnings missed the Zacks Consensus Estimate, primarily as a result of prior-year reserve additions. Going forward, the casualty line and the marine books are expected to decline due to tough market conditions.
Additionally, the potential for future reserve additions also remains a challenge. Our six-month target price of $72.00 per share equates to 8.5X our earnings estimate for 2010.
Latest Posts on the Zacks Analyst Blog:
New Home Sales Just Plain Ugly
While the sustained level of around 4 months during the housing bubble is not where we should be either, having over 9 months supply on the market is not an indication of a healthy market. The major homebuilders have really only managed to stay in business because they got massive tax breaks. They have been able to carry back their current losses for five years, which essentially means that every penny of taxes they paid during the boom years is coming back to them in the form of tax refunds.
With 9 months of product “on the shelves,” there is no real reason for them to build any more homes (yes, I know that there can be regional differences, and a that an empty home in Tampa is not a great substitute for a house in Tacoma, but still…). If they are not building new houses, then they are not buying new plumbing fixtures from Fortune Brands (FO) or Masco (MAS), and they are not ordering a lot of wallboard from USG (USG).
They are also not employing a lot of people to build the houses, and construction is normally one of the big swing factors in employment. It is also an industry that has been extremely hard hit in this downturn, accounting for 31.8% of all job losses since the industry peaked (in terms of jobs) in August 2006.
Get the full analysis of all these stocks by going to http://at.zacks.com/?id=5507.
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