Zacks Equity Research picks Sierra Wireless (Nasdaq: SWIR) as Bull of the Day and Banco Bilbao Vizcaya Argentaria, S.A. (NYSE: BBV) as Bear of the Day. In addition, the analysts at Zacks Equity Research discuss the latest on DirecTV (NYSE: DTV), Liberty Media (Nasdaq: LINTA) and News Corp (NYSE: NWS).
Full analysis of all these stocks is available at: http://at.zacks.com/?id=2678
Bull of the Day
We reiterate our Buy rating for Sierra Wireless (Nasdaq: SWIR), a leading developer of OEM wireless modem cards and access solutions, following the company’s recent financial results, achieving strong free cash flow generation and effective cost reduction initiatives.
Sierra’s first quarter 2009 financial results were well above our estimates even as the company contends with intensifying competition in the PC OEM market, coupled with unfavorable economic conditions. Management also provided an encouraging outlook for financial performance over the next quarter.
According to our assessment, Sierra’s acquisition of Wavecom may act as a major revenue catalyst in future reporting periods. This acquisition is expected to diversify the company’s business opportunities into new vertical markets -- in particular, the high-margin machine-to-machine segment.
Bear of the Day
We are continuing our Sell rating on Banco Bilbao Vizcaya Argentaria, S.A. (NYSE: BBV), as well as our $9 target price. In its first quarter report, BBVA posted net earnings before nonrecurring items of EUR1.2 billion, down 14% from the EUR1.4 billion earned in the comparable 2008 period, and above our estimate as both revenues and expenses came in better than expected. Results reflected 20% growth in net interest income, due to higher volumes and improved margins.
While noninterest expense rose 49% year over year, it fell 30% sequentially. Loan loss provisions jumped 65%, largely due to growing nonperforming loans that increased 67% year over year and 22% sequentially. We are increasing our 2009 EPADS estimate to $1.57 from $1.52, principally reflecting the first quarter overage.
We expect recent operating trends to continue near term. Our initial EPADS estimate for 2010 is $1.63. BBVA paid the fourth quarter dividend in stock and will be cutting its payout ratio to about 30% from roughly 50% in recent years.
Recent Analysis from the Analyst Blog
DirecTV Gains Content, Independence
The post-spinoff DirecTV (NYSE: DTV) will own 54% of the common stock of DirecTV, and gain content assets -- three regional sports networks, the majority of the Game Show Network and Internet game company FUN Technologies.
Liberty Media (Nasdaq: LINTA), which is controlled by cable pioneer John Malone, currently owns a 51% stake in DTV shares and has 48% voting control. The stake was acquired from News Corp (NYSE: NWS) in February 2008 in exchange for Liberty's stake in NWS. After the spin off, John Malone will relinquish his voting power and control just 24% of DirecTV through super-voting Class B shares.
Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: 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 analysis from Zacks Equity Research about the latest news and events impacting stocks and the financial markets.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today by visiting http://at.zacks.com/?id=2677.
About Zacks
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leonard Zacks. As a PhD in mathematics Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at http://at.zacks.com/?id=4582.
Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.
Contacts:
Mark Vickery
Web Content Editor
312-265-9380
Visit:
www.zacks.com
