For Immediate Release
Chicago, IL – December 15, 2009 – Zacks Equity Research highlights China Mobile (CHL) as the Bull of the Day and Synopsys, Inc. (SNPS) the Bear of the Day. In addition, Zacks Equity Research provides analysis on Citigroup Inc. (C), American International Group Inc. (AIG) and GMAC Inc.(GJM).
Full analysis of all these stocks is available at http://at.zacks.com/?id=5506
Here is a synopsis of all five stocks:
China Mobile (CHL), the largest wireless carrier in the world, continues to deliver healthy operating results as demonstrated by strong subscriber retention in 2008.
As we approach the end of 4th quarter 2009, our opinion remains firm that new competitive entities face unanticipated challenges deploying and advancing services to levels and coverage delivered by China Mobile. Accordingly, we assess that successful expansion into low-penetration rural regions of China, coupled with aggressive 3G TD-SCDMA service deployments in 2009, establish China Mobile as the dominant mobile provider, far ahead of its nearest competitors.
Additionally, a strong balance sheet, strong free cash flow and sustainable dividends facilitate the company’s efforts to weather economic volatility. We maintain our Outperform rating even as we factor in potential resulting from competitive factors and a comparatively weaker Chinese economy though the end of 2009.
Synopsys, Inc. (SNPS) delivered mediocre third quarter results, with below-par operating performance. The 2010 guidance does not reflect any major growth. Although Synopsys is gaining traction from new products, acquisitions, and new EDA partnerships, we believe these are unlikely to show results in the near term.
We believe Synopsys’ time-based license model has good visibility and it has a strong balance sheet. On the other hand, the semiconductor industry has yet to stabilize and generate demand.
Synopsys is facing customer concentration risk. The industry-wide weakness is impacting its core business. We therefore downgrade the stock from Neutral to Underperform.
Latest Posts on the Zacks Analyst Blog:
Pay Czar Imposes New Restrictions
The new rule by the pay czar puts the cash compensation cap of $500,000 for the 26th to 100th highest-paid employees at the four firms for which he still oversees employee compensation. Also, according to the new rule, total cash may not exceed 45% of total compensation, with the remainder being paid in company stock.
The compensation plans of Citigroup Inc. (C), American International Group Inc. (AIG), General Motors and GMAC Inc.(GJM) continue to be under the jurisdiction of the pay czar. However, Chrysler and Chrysler Financial were not subject to the new rule as total pay for their second-tier executives does not exceed $500,000.
The guidelines cover 2009 salaries but will also set the framework for compensation next year. Previously, in October, the pay czar slashed 50% pay of the top 25 earners at seven firms that have received substantial support from the Government. The pay restrictions have caused significant negative vibes within AIG, where key employees, including CEO Robert Benmosche, have considered leaving several times.
Get the full analysis of all these stocks by going to http://at.zacks.com/?id=5507.
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