For Immediate Release
Chicago, IL – April 22, 2010 – 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: Wells Fargo & Co. (WFC), St. Jude Medical, Inc. (STJ), Medtronic Inc. (MDT), Boston Scientific Corporation (BSX) and Moody’s Inc. (MCO).
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Here are highlights from Wednesday’s Analyst Blog:
Wells Fargo Beats Estimates
Wells Fargo & Co.’s (WFC) first quarter 2010 operating earnings per share was 50 cents, topping the Zacks Consensus Estimate of 42 cents. Net income applicable to common stock came in at $2.55 billion or 45 cents per share compared to $3.05 billion or 56 cents in the prior-year quarter. This included after-tax integration expenses of $247 million or 5 cents per share.
During the quarter, Wells Fargo earned $21.4 billion (up 2% year-over-year) of combined revenue, driven primarily by 20% growth in trust and investment fees, 7% growth in insurance fees and 14% growth in processing and other fees. While total mortgage banking remained flat, results for mortgage hedging reduced drastically.
Net interest income for the quarter came in at $11.1 billion, down from $11.5 billion in the prior quarter. While earning assets were down at $1.07 trillion, the decline in core loans, the reduction in non-strategic assets and mortgage-backed securities reduced net interest income growth although net interest margin (NIM) increased to 4.27% from 4.16% year-over-year.
However, these declines were offset by significant growth in non-interest-bearing checking and savings deposits and wider new lending spreads, which are expected to be beneficial for net interest income over the long term.
St. Jude Beats Zacks Consensus
St. Jude Medical, Inc. (STJ) reported strong financial results for the first quarter of fiscal 2010. For the first quarter, earnings per share came in at 75 cents, beating the Zacks Consensus Estimate of 68 cents and the year-ago profit of 58 cents.
St. Jude has provided earnings per share guidance for the second quarter and fiscal 2010. For the second quarter, earnings per share are expected between 73 cents and 75 cents. For fiscal 2010, earnings per share are expected between $2.80 and $2.85, compared to the previous guidance of $2.71 to $2.76.
St. Jude is a leading designer, manufacturer and distributor of medical devices used for treating cardiovascular and neurological conditions. The company is a leader in the mechanical heart valve market.
St. Jude’s closest competitors are Medtronic Inc. (MDT) and Boston Scientific Corporation (BSX).
Moody’s Beats, Guidance Reaffirmed
Moody’s Inc. (MCO) reaffirmed its fiscal 2010 guidance, previously given out during the fourth quarter conference call. Despite better-than-expected first-quarter 2010 results, the company reiterated its guidance due to the uncertainty regarding issuance levels that could overcome weakness in its structured finance business in the second half of the year.
Full-year 2010 revenues are expected to increase in the high-single-digit percentage range. Expenses are also expected to increase in the high-single-digit percentage range. As a result, operating margin is forecasted in the high-thirties percentage range.
The effective tax rate is expected to be in the range of 37% to 38%. Earnings per share are expected to be in the $1.75 – $1.85 range, 2 cents below the Zacks Consensus Estimate. Share repurchase is expected to resume at modest levels in 2010.
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