For Immediate Release
Chicago, IL – January 18, 2010 – Zacks Equity Research highlights Xilinx, Inc. (XLNX) as the Bull of the Day and Accuray Incorporated (ARAY) the Bear of the Day. In addition, Zacks Equity Research provides analysis on JPMorgan Chase & Company (JPM), American Electric Power (AEP) and Con Ed (ED).
Full analysis of all these stocks is available at http://at.zacks.com/?id=5506
Here is a synopsis of all five stocks:
Xilinx, Inc. (XLNX) recently upgraded its guidance for the third quarter of fiscal 2010. Xilinx now expects sales in the third quarter to increase 16%-20% sequentially, up from the previous guidance of around 6%-10%. The new guidance implies revenues between $481 million and $498 million in the December quarter.
Management increased sales guidance, primarily due to the broad-based strength across all end-market categories and geographies. The company now projects gross margin around 64%, up from the earlier estimate of 62%-63%.
The company is expected to report third quarter results on January 20, 2010. We upgrade our rating on the stock from NEUTRAL to OUTPERFORM in view of the expected strong performance in the coming quarters.
Accuray Incorporated (ARAY) designs, develops and sells the CyberKnife System, an image-guided robotic radiosurgery system used for the treatment of solid tumors. The company was badly affected by reimbursement uncertainties surrounding its products.
This was reflected in Accuray’s top and bottom line performance in the first quarter of fiscal 2010. Accuray reported a net loss of $0.06 per share in the first quarter, compared to the Zacks Consensus Estimate of a net loss of $0.03 per share and unchanged from the year-ago figure.
Total revenues declined 9.5% year over year in the reported quarter. We downgrade the stock to Underperform with a target price of $6.
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JPMorgan Beats on Surging Profits
JPMorgan Chase & Company’s (JPM) 4th quarter earnings came in at 74 cents per share, substantially ahead of the Zacks Consensus Estimate of 61 cents. This also compares favorably with earnings of 6 cents in the prior-year quarter.
Better-than-expected results of JPMorgan were primarily aided by continued strong performance of the company’s Investment Bank. All other segments except Consumer Lending and Card Services also delivered solid results during the quarter. However, high levels of consumer credit costs and increased provisions for credit losses were primary factors, which negatively impacted results.
Net income available to common shareholders was $3.3 billion, compared to $3.6 billion in the prior quarter and $702 million in the prior-year quarter. The year-over-year increase was driven by higher net revenue, largely offset by higher provision for credit losses and non-interest expense.
For full year 2009, JPMorgan’s net income came in at $11.7 billion or $2.26 per share, more than double that of $5.6 billion or $1.35 per share in 2008.
Industrial Production Rises
The overall picture is one of an economy that lost a bit of steam in December after a big surge in November. It is too early to tell if this is simply a little bit of a pause, or if the November strength was just a sugar rush due to economic stimulus efforts that will prove to be unsustainable.
The fact that overall industrial production growth matched that of November is deceptive; although to be fair, the cold snap that helped Utility output might have had a bit of an adverse effect on manufacturing output (though that effect is probably very small, certainly relative to the positive effect it had on Utility output). While the surge in Utility output will help the earnings of the major electric utilities like American Electric Power (AEP) and Con Ed (ED) in the fourth quarter, it is not really a sign of better overall economic health.
Get the full analysis of all these stocks by going to http://at.zacks.com/?id=5507.
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