For Immediate Release
Chicago, IL – November 25, 2009 – Zacks Equity Research highlights MEMC Electronic Materials, Inc. (WFR) as the Bull of the Day and Energy Transfer Partners (ETP) the Bear of the Day. In addition, Zacks Equity Research provides analysis on Ford (F), Whirlpool (WHR) and Wal-Mart (WMT).
Full analysis of all these stocks is available at http://at.zacks.com/?id=5506
Here is a synopsis of all five stocks:
MEMC Electronic Materials, Inc. (WFR) produces the raw material wafers used by semiconductor manufacturers in the production of integrated circuits (ICs).
The decision to supply wafers to the solar industry paid huge rewards in 2007 and 2008, as demand for polysilicon raced ahead of supply. The Solar business and the 300mm business are both high-margin products. The spot price of polysilicon has been slashed from a peak of $400 per/kg to the $60-$70 per/kg range.
The stock is significantly undervalued. We are reiterating our Buy rating on the shares of WFR.
Our Underperform recommendation on Energy Transfer Partners (ETP) units takes into account the bearish outlook for pipeline operators. While the partnership’s liquidity position is sound, we continue to believe that the near- to medium-term outlook for its natural gas gathering and processing business remains weak.
Weighed down by these factors, Energy Transfer posted a third-quarter 2009 loss. The partnership’s low growth and seasonal propane business also remain a major liability, in our view.
Given these headwinds, we expect Energy Transfer units to be under pressure in the medium- to long-term. The partnership’s discounted valuation relative to the pipeline MLP group reflects its heightened risk profile.
Latest Posts on the Zacks Analyst Blog:
Consumer Confidence Increasing
The 5,000 households’ (that the Conference Board surveyed) assessment of the present situation fell ever-so-slightly to 21.0 from 21.1. That is a very bad reading, not too far from the record low set in February 1983 of 17.5%. Overall, 45.7% of consumers saw the current business conditions as bad, down from 46.7% in October, while 8.1% saw business conditions as good, up from 7.8% last month. Their view of the labor market continued to deteriorate, with 49.8 seeing jobs as hard to get, up from 49.4% last month. The percentage (of deluded people) who saw jobs as plentiful dropped to 3.2% from 3.5% in October.
While the better-than-expected consumer confidence reading for this month — and the upward consumer confidence revision to last month — are encouraging, the details of the report are not all that robust. In theory, higher consumer confidence should lead consumers to open up their wallets, something that is very important as the holidays approach. If consumers have confidence about the economy, they are more likely to buy big ticket items like cars from Ford (F) or major appliances from Whirlpool (WHR). Perhaps they might buy more impulse items at the checkout counter at Wal-Mart (WMT).
Historically though, the consumer confidence numbers, like the University of Michigan sentiment numbers, do not have a great track record of predicting how consumers will behave. So count this consumer confidence report as a minor positive. Changes in consumer spending generally have much more to do with changes in personal income than with this sort of survey data, and that data is due out tomorrow.
Get the full analysis of all these stocks by going to http://at.zacks.com/?id=5507.
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