For Immediate Release
Chicago, IL – January 4, 2010 – Zacks Equity Research highlights OPNET Technologies (OPNT) as the Bull of the Day and Cadence (CDNS) the Bear of the Day. In addition, Zacks Equity Research provides analysis on Fannie Mae (FNM), Freddie Mac (FRE) and Ford Motor Co.(F).
Full analysis of all these stocks is available at http://at.zacks.com/?id=5506
Here is a synopsis of all five stocks:
We are extending our estimates on OPNET Technologies (OPNT) through 2012 fiscal year. OPNET reported exceptional second quarter results due to strong new software license revenue.
Gross profit margins were well above expectations. We expect gains in market share to continue. Continued cost controls and the booking of deferred revenue should improve earnings. Software license growth should have a positive impact on near-term revenue.
We maintain our outperform rating and increased our target price to $14.50.
Cadence (CDNS) reported weak results for the third quarter, and blamed the shortfall on softness in EDA spending. We expect that a turnaround is going to take time due to mounting financial problems leading to lackluster growth.
Fourth quarter and 2009 guidance was not encouraging. Although Cadence is offering new products and taking cost-cutting measures, we are not confident in the company’s ability to grow and show healthy fundamentals over the near term. Cadence also withdrew its bid for Mentor Graphics in 2008, further dimming its growth prospects.
Cadence recently came out with enhanced versions of its products, but it will take time for these to generate additional revenue. 2011 estimates have been added. We maintain an Underperform rating on the shares a six-month price target of $4.50 per share.
Latest Posts on the Zacks Analyst Blog:
Fannie & Freddie Out of Pay Limit
U.S. pay czar Kenneth Feinberg said on Wednesday that mortgage finance giants Fannie Mae (FNM), Freddie Mac (FRE) are being discriminated, with respect to pay restrictions, from other companies receiving significant financial support from the government as they countenance a unique set of problems.
The pay czar, who decides compensation-packages for the highest-paid employees at all the firms that received bailout money and have not repaid yet, considers the situation of Fannie Mae and Freddie Mac unique as the future of these companies is uncertain.
After slashing 50% pay of the top 25 earners in October at seven firms that have received substantial support from the Troubled Asset Relief Program (TARP), earlier this month, the pay czar announced a new set of pay restrictions on top executives at four of those firms. The primary intention of the pay czar is to enable the bailed out firms to repay government money by controlling excessive pay. However, despite receiving substantial government support, Fannie and Freddie’s regulator, the Federal Housing Finance Agency (FHFA), did not impose any pay restrictions on top executives of these firms.
Geely Optimistic About Volvo
China-based Zhejiang Geely Holding Group is optimistic about its acquisition of Swedish brand Volvo from Ford Motor Co.(F). Geely is close to acquiring Volvo in early 2010, with strong support from the Chinese Government.
Geely is eager to tap China’s high-growth auto market by acquiring modern, innovative technologies from the Swedish brand to upgrade its car lineup. The automaker expects robust growth for China’s auto industry in 2010. In this situation, upgrading the product lineup would no doubt land the automaker in a favorable market position.
Geely is seeking about $1 billion in loans to finance the $1.8 billion deal. Three major Chinese banks, including Bank of China, China Construction Bank and Export-Import Bank of China have agreed to extend loans to the Chinese automaker for the deal.
Beside the financial support for the deal, Geely would also benefit from the Chinese Government’s subsidies policy, which will continue in 2010. Earlier this month, the Chinese Government revealed that it would subsidize sales of “green vehicles” in some cities in an effort to promote environmentally friendly transport to lower fuel emissions and boost domestic consumption. The Government will also offer rebates to Chinese private car buyers for the first time.
Get the full analysis of all these stocks by going to http://at.zacks.com/?id=5507.
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