CHICAGO, Aug. 26, 2011 /PRNewswire/ -- Zacks Equity
Research highlights Eaton Corp. (NYSE: ETN) as the Bull of
the Day and Big 5 Sporting Goods (Nasdaq: BGFV) as the Bear
of the Day. In addition, Zacks Equity Research provides analysis
Tiffany & Company (NYSE: TIF), Signet Jewelers
Limited (NYSE: SIG) and Zale Corporation (NYSE:
ZLC).
(Logo:
http://photos.prnewswire.com/prnh/20101027/ZIRLOGO)
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:
Eaton Corp. (NYSE: ETN), a diversified power management
company and global leader in electrical components and systems,
outperformed Zacks Consensus Estimates yet again, driven by 12%
end-market growth. Eaton sees 2011 shaping up as the best year in
its history. Following the better-than-expected second quarter
results, the company raised its full-year guidance and expects to
see record sales and profits in 2011.
Eaton has gradually transformed itself from an automotive and
truck component manufacturer into a diversified industrial
enterprise with leading positions in its core electrical, hydraulic
and aerospace market segments. An improvement in global market
conditions should help boost the company's bottom lines.
Eaton's stable dividend program, which yields an impressive
3.6%, also makes the stock attractive. We are maintaining our
Outperform rating on Eaton.
Bear of the Day:
Big 5 Sporting Goods' (Nasdaq: BGFV) second-quarter 2011
earnings dropped the prior-year quarter. The decline was primarily
attributable to a 1.7% fall in same-store sales. Accordingly, the
company has lowered same-store sales projections for third-quarter
2011, reflecting a sharp decline from the prior-year quarter.
Big 5 Sporting Goods also sees intense competition from national
chains, mass merchandisers and regional stores which may dent its
future operating performance. Moreover, the seasonal nature of
business and risks associated with sourcing from foreign countries
may have an adverse impact on the company's future performance.
Our long-term Underperform recommendation on the stock indicates
that it would perform well below the broader market. Our target
price of $6.65, 10.2x 2011 EPS,
reflects this view.
Latest Posts on the Zacks Analyst Blog:
Earnings Preview: Tiffany & Co.
Tiffany & Company (NYSE: TIF), a high-end jewelry
designer, manufacturer and retailer, is scheduled to report its
second-quarter 2011 financial results before the bell on
Friday, August 26, 2011. The current
Zacks Consensus Estimate for the quarter is 69 cents a share. For the quarter under review,
revenue is $786 million, according to
the Zacks Consensus Estimate.
First-Quarter 2011, a Synopsis
Tiffany posted better-than-expected first-quarter 2011 results
buoyed by improved demand for luxury items worldwide and
consequently raised its full year outlook. The quarterly earnings
of 67 cents a share surpassed the
Zacks Consensus Estimate of 57 cents,
and rose substantially from 48 cents
earned in the prior-year quarter.
Tiffany, which faces stiff competition from Signet Jewelers
Limited (NYSE: SIG) and Zale Corporation (NYSE: ZLC),
posted net sales of $761 million
during the quarter, up 20% from the prior-year quarter, on the
heels of a stellar performance in Americas, Asia-Pacific and European regions, healthy
same-store sales growth and new collection launches.
Total revenue also handily beat the Zacks Consensus Estimate of
$703 million. Comparable-store sales
climbed 19% in the quarter under review. In constant currencies net
sales jumped 16% and comps grew 15%.
Guidance
Tiffany raised its fiscal 2011 earnings guidance on the back of
stronger-than-expected results. Tiffany now projects earnings in
the range of $3.45 to $3.55, up from
a range of $3.35 to $3.45 per share,
forecasted earlier.
Second-Quarter 2011 Zacks Consensus
The analysts considered by Zacks, expect Tiffany to post
second-quarter 2011 earnings of 69
cents a share. The current Zacks Consensus Estimate reflects
a growth of 25.5% from the prior-year quarter's earnings. The
current Zacks Consensus Estimate for the quarter ranges between
64 cents and 77 cents.
Zacks Agreement & Magnitude
Of the 17 analysts following the stock, only 1 has increased the
projection and none lowered their estimates, thereby keeping the
Zacks Consensus Estimate constant over the last 30 days. In the
last 7 days, only one analyst revised the estimate upwards, while
none slashed their estimates, thus having no material impact on the
Zacks Consensus Estimate.
Positive Earnings Surprise History
With respect to earnings surprises, Tiffany has topped the Zacks
Consensus Estimate over the last four quarters in the range of 3.6%
to 27.8%. The average remained at 13.2%. This suggests that Tiffany
has beaten the Zacks Consensus Estimate by an average of 13.2% in
the trailing four quarters.
Tiffany to Outperform
Tiffany is well positioned to deliver robust sales and earnings
growth by leveraging capital investments made in the past several
years. The company holds a significant position in the world
jewelry market and is poised to benefit from its enhanced
geographic reach. With signs of improvement in retail environment,
Tiffany plans to accelerate its store expansion program.
Moreover, with a healthy balance sheet, Tiffany remains
committed to achieving long-term objectives of at least a 15%
return on equity and a 10% return on assets. The company in the
wake of better-than-expected first-quarter 2011 results now
anticipates a mid-teens percentage rise in total net sales and an
increase of 18% to 21% in earnings per share for fiscal 2011.
Currently, we have a long-term Outperform rating on the stock.
However, Tiffany holds a Zacks #3 Rank, which translates into a
short-term Hold recommendation.
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
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