For Immediate Release
Chicago, IL – August 12, 2009 – Zacks Equity Research highlights AutoNation (AN) as the Bull of the Day and Canon (CAJ) the Bear of the Day. In addition, Zacks Equity Research provides analysis on J.P. Morgan (JPM), Goldman Sachs (GS) and U.S. Bank (USB).
Full analysis of all these stocks is available at http://at.zacks.com/?id=2676
Here is a synopsis of all five stocks:
AutoNation (AN) remains focused on improving its product mix and cost cutting initiatives. The company beat the Zacks Consensus Estimate by posting higher profits in the second quarter despite difficult industry conditions.
The company addressed its cost reduction initiatives, lower interest expense, disciplined operating model and inventory management for maintaining the profits.
As such, we have upgraded the stock to an Outperform recommendation with a target price of $22.00.
We believe the sharp appreciation of the yen is eroding Canon’s (CAJ) revenue and profits. 2Q results were weak with revenue and earnings much below expectations.
We expect revenue in 2009 to be hurt by weak consumer spending and a worsening global economy, and believe the company will struggle to meet expectations in fiscal 2009. We maintain our estimates for the full year.
We also maintain our Sell recommendation on CAJ shares with a six-month target price of $25.00.
Latest Posts on the Zacks Analyst Blog:
Toxic Assets Still There
“The recently conducted stress tests weighed the ability of the nation‘s 19 largest bank holding companies to weather further losses from the troubled assets and assessed how much additional capital would be needed. However, the adequacy of the stress tests and the resulting adequacy of the capital buffer required for future financial stability depend heavily on the economic assumptions used in the tests. As more banks exit the TARP program, reliance on stress-testing for the economic stability of the banking system increases.”
In other words, much of the improvement we have seen in the banking system, particularly among the big 19 stress-tested banks — such as J.P. Morgan (JPM), Goldman Sachs (GS) and U.S. Bank (USB) — has come from changes in the accounting rules, rather than a change in the fundamental economic value of the securities. There has been some real improvement in the condition of the banks, but that is mostly due to the large round of capital raising in the wake of the stress tests.
The decision to inject capital rather than buy up the assets was a much more effective use of the TARP funds to stabilize the banking system, but it has left the fundamental problem in place: billions and billions of loans that were made that are unlikely to be paid back. The changes in the accounting rules allow the banks to extend and pretend that the loans still have a much higher value than they really do. This buys the banks some time.
Get the full analysis of all these stocks by going to http://at.zacks.com/?id=5507.
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. Subscribe to this free newsletter today by visiting http://at.zacks.com/?id=5508.
About Zacks
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leonard Zacks. As a PhD in mathematics Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which 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 at http://at.zacks.com/?id=5509.
Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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
Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.
Contact:
Mark Vickery
Web Content Editor
312-265-9380
Visit: www.zacks.com
