For Immediate Release
Chicago, IL – August 26, 2009 – Zacks Equity Research highlights Intuitive Surgical (ISRG) as the Bull of the Day and Cost Plus Inc. (CPWM) the Bear of the Day. In addition, Zacks Equity Research provides analysis on Ford (F), Honda (HMC) and The Gap (GPS).
Full analysis of all these stocks is available at http://at.zacks.com/?id=2676
Here is a synopsis of all five stocks:
Intuitive Surgical’s (ISRG) story is improving. A new product was developed as an upgrade to the existing daVinci Surgical System. Furthermore, the company enjoys a virtual monopoly in robotic surgery without direct competition.
The company’s razor/razor blade business model ensures recurring revenues even during difficult times. In the second quarter, earnings of $1.62 per share were higher than the Zacks Consensus Estimate of $1.27.
Growth in revenues was witnessed across all the segments. We believe the company will continue leveraging its monopoly position in the industry. We rate this stock Outperform with a target price of $260 per share.
First quarter sales and earnings per share for Cost Plus Inc. (CPWM) were slightly above our estimates. Even so, the company’s sales declined 9% year-on-year and it reported a net loss of $20 million.
The company is closing stores, cutting costs, and trying to preserve cash, but those moves will do little reverse its weak sales trends and merchandise margins. In addition, management’s guidance for the second quarter cautioned investors to prepare for more of the same.
Cost Plus expects same-store sales to decrease 9.5%-14.5% and a pre-tax loss from continuing operations of $14-$21 million. We have an Underperform rating on CPWM shares. Our six-month target price is 50 cents per share.
Latest Posts on the Zacks Analyst Blog:
Gaining Confidence
The rise in consumer confidence means that “animal spirits” may be returning to Main Street, not just Wall Street. If consumers feel more confident, they are more likely to go out and spend, particularly on big-ticket discretionary items. This will greatly help retailers and the companies that make discretionary items.
Even with the “Cash for Clunkers” program running out again, it means that some folks might just feel confident enough about the future to go out and buy a new car from Ford (F) or Honda (HMC), even if they are not bribed to do so by the Federal Government. It means they might go do their back to school shopping at The Gap (GPS) instead of at the Salvation Army.
In the process, they will increase demand and put people back to work. Those workers will then have incomes that they can spend, further increasing economic activity. In short, a vicious cycle would be turning into a virtuous cycle.
Get the full analysis of all these stocks by going to http://at.zacks.com/?id=5507.
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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.
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