For Immediate Release
Chicago, IL – February 18, 2010 – Zacks Equity Research highlights CarMax (KMX) as the Bull of the Day and France Telecom (FTE) the Bear of the Day. In addition, Zacks Equity Research provides analysis on M/I Homes (MHO), Hovnanian (HOV) and Standard Pacific (SPF).
Full analysis of all these stocks is available at http://at.zacks.com/?id=5506
Here is a synopsis of all five stocks:
CarMax (KMX) focuses on penetrating new markets through store openings. The company has kept its inventories closely aligned with sales trends, which has allowed it to optimize gross profit per unit while offering great value to customers. These have helped the company to maintain a favorable position among its peer group.
CarMax reported a profit in the third quarter of fiscal 2010, reflecting a significant improvement over the Zacks Consensus Estimate. We continue with our Outperform recommendation on the stock with a target price of $25.
We downgrade our recommendation for France Telecom (FTE) to Underperform based on the operator’s lackluster operating results and lack of visibility for operational improvements in the near-term. The company remains significantly challenged by the weak economic conditions across its key European markets, which continue to weigh on the top-line.
Revenue in the last quarter was hurt by adverse exchange rate swings, intense competition and unfavorable regulatory measures. France Telecom’s wireline voice business is shrinking at a greater pace than its major European peers as recession-hit customers discontinue landline phone use.
Moreover, the company has suspended all restructuring actions due to significant pressure from workers unions. Moving forward, revenue is expected to remain under pressure due to the prevailing economic, competitive and regulatory factors.
Latest Posts on the Zacks Analyst Blog:
Housing Starts Up 21% from Jan. ‘09
Regionally, the data was mixed.On a month-over-month basis, the Northeast (by far the smallest of the four census regions when it comes to housing data) was the strongest, posting a 10.0% gain. The West was also strong with a 8.9% rise. Gains in the South, by far the biggest region, were more muted, with just a 1.0% rise. Starts in the Midwest fell 3.2%.
On a year-over-year basis, all regions but the West are now in positive territory. The West is down 11.6% from a year ago. The gains in the Northeast, on the other hand, are an eye-popping 73.7%. However, even with that rise, the Northeast was responsible for only 11.2% of all starts (up from 7,8% a year ago).
The Midwest posted a 56.9% year-over-year increase and the South is up 22.8% from a year ago. This would tend to indicate that homebuilding firms with more of a footprint in the Northeast and Midwest like M/I Homes (MHO) and Hovnanian (HOV) are probably doing better than firms more focused in the West like Standard Pacific (SPF).
Get the full analysis of all these stocks by going to http://at.zacks.com/?id=5507.
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