Zacks Bull & Bear of the Day Highlights: Hibbett Sporting Goods, HSBC Holdings plc, Dollar General, SAP & SuccessFactors - Pr...
December 06 2011 - 3:30AM
Zacks
For Immediate Release
Chicago, IL – December 6, 2011 – Zacks Equity Research
highlights Hibbett Sporting Goods (HIBB) as the
Bull of the Day and HSBC Holdings plc (HBC) as the
Bear of the Day. In addition, Zacks Equity Research provides
analysis on Dollar General (DG),
SAP (SAP) and SuccessFactors
(SFSF).
Full analysis of all these stocks is available at
http://at.zacks.com/?id=2678.
Here is a synopsis of all five stocks:
Bull of the Day:
Hibbett Sporting Goods' (HIBB) earnings of
$0.59 per share for the third quarter ended October 2011 beat the
Zacks Consensus Estimate of $0.51 and surged 34% from the
prior-year quarter on the heels of robust performance of footwear
and apparel sales along with operational efficiencies. Management
has raised its earnings guidance for the current fiscal year to a
range of $2.05 to $2.11 a share.
Management also remains committed to expanding the store
network. Moreover, Hibbett's sharp focus on mid-sized and smaller
markets and strategic mix of branded as well as localized
merchandise provide an edge over its rivals. Also, the company has
a healthy balance sheet with no bank debt.
Our long-term Outperform recommendation on the stock indicates
that it would perform well above the market. Our target price of
$47.00, 22.2x 2011 EPS, reflects this view.
Bear of the Day:
We are initiating our coverage on HSBC Holdings
plc (HBC) with an Underperform recommendation. Our primary
concern is the harsh impact from the deepening Eurozone crisis.
Moreover, the company is suffering from weak revenue growth in its
mature markets due to the ongoing low interest rates and regulatory
restrictions.
The company's cost containment measures will help it deal with
economic pressures to a great extent. But we expect high inflation
in some key Asian markets, slothful loan growth, insufficient core
operating performance and high wage inflation to restrict the
company's growth, at least in the near term.
Our six-month target price of $36.00 per ADS equates to about
8.5x our earnings estimate for fiscal 2011. This target price
implies an expected negative total return of 9.0% over that period.
This is consistent with our long-term Underperform recommendation
on the ADSs.
Latest Posts on the Zacks Analyst Blog:
Growing Optimism in the Eurozone
Growing hopes of positive momentum on the Euro-zone front will
likely help stocks build on last week’s strong gains as European
leaders meet on Friday for a decisive summit meeting. The
expectation is that this week’s summit meeting will help provide
the framework for greater fiscal integration in the union, which
will pave the way for the European Central Bank (ECB) to play a
decisive role in propping up individual member country bonds.
On the U.S. front, we have a relatively quite economic calendar
this week, though we have the non-manufacturing ISM and Factory
Orders reports on deck for release a little later. The rest of this
week brings in International Trade and Consumer Sentiment readings,
both on Friday.
Notwithstanding the paucity of U.S. economic data this week, the
domestic outlook appears to be in very good shape. The holiday
shopping season has gotten off to a solid start, the labor market
is steadily improving, and the manufacturing sector appears to have
rebounded nicely from the summer slump. All high-frequency
indicators are pointing towards fourth-quarter GDP growth in the
2.5% to 3% range.
The only source of uncertainty for the market at present is Europe,
with the recent uptrend in the Italian government bond yields --
the third largest bond market in the world -- raising doubts about
the union’s long-term survival. It is in this context and the
significance of Friday’s summit meeting that a number of market
watchers are calling this a ‘make-or-break week’ for Europe.
We will see if those lofty expectations come to fruition. But in
the run up to the Friday summit, the technocratic government of
Italian prime minster Mario Monti unveiled today austerity measures
aimed at bringing down the country’s budget deficit. These spending
cuts and other pension changes, which are equivalent to roughly
1.9% of Italy’s GDP, will be presented to the Italian parliament
for approval late today. The bond market appears to be giving these
measures a vote of confidence as evident from the drop in Italian
government bond yields today. We will have to wait and see if this
trend can be sustained in the coming days.
In corporate news, we have a solid earnings and revenue beat from
discount retailer Dollar General (DG). In another
sign of continued move towards cloud computing, business software
giant SAP (SAP) is acquiring
SuccessFactors (SFSF) for $3.4 billion.
Get the full analysis of all these stocks by going to
http://at.zacks.com/?id=2649.
About the Bull and Bear of the Day
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.
About the Analyst Blog
Updated throughout every trading day, the Analyst Blog provides
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events impacting stocks and the financial markets.
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Continuous analyst coverage is provided for a universe of 1,150
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DOLLAR GENERAL (DG): Free Stock Analysis Report
HSBC HOLDINGS (HBC): Free Stock Analysis Report
HIBBET SPORTS (HIBB): Free Stock Analysis Report
SAP AG ADR (SAP): Free Stock Analysis Report
SUCCESSFACTORS (SFSF): Free Stock Analysis Report
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