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Altera Corporation (ALTR) – Bear of the Day

admin — Thu, 02 Feb 2012 05:00:01 +0000

Earnings estimates for Altera Corp. (ALTR) have declined significantly after a weak guidance for the first quarter of 2012. The company expects sales to decline 5%-9% sequentially. As per management, the program timing in the Military section will account for half of the decline.

The company expects revenues from the wireless segment to move lower across multiple geographies due to continued inventory depletion and softening of demand in the second half of 2011. Altera has a large exposure to the telecommunications industry, in particular China.

The recent slowdown in China has adversely impacted the company's business. Therefore, we have downgraded our recommendation to Underperform from Neutral.

ALTERA CORP (ALTR): Free Stock Analysis Report

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Bank of America Corp. (BAC) – Bear of the Day

admin — Wed, 01 Feb 2012 05:00:01 +0000

Bank of America Corp.'s (BAC) fourth-quarter earnings came in substantially lower than the Zacks Consensus Estimate. The sale of non-core assets and accounting gains made it possible for the company to remain profitable during the quarter. However, excluding nonrecurring items, the company would have incurred a loss.

Higher non-interest expense was the primary headwind in the quarterly numbers. Also, capital and liquidity remained weak. For the full year 2011, the company reported earnings of $0.01 per share, a nickel lower than the Zacks Consensus Estimate.

Our six-month target price of $6.50 per share equates to about 7.0x our earnings estimate for 2012. This price target implies an expected negative total return of 8.1% over that period, which is consistent with our long-term Underperform recommendation on the shares.

BANK OF AMER CP (BAC): Free Stock Analysis Report

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NII Holdings, Inc. (NIHD) – Bear of the Day

admin — Tue, 31 Jan 2012 05:00:01 +0000

We have downgraded our recommendation on NII Holdings, Inc. (NIHD) to Underperform backed by our assessment that the company s nightmare will continue in the near future. NII Holdings reported dismal financial results for the third quarter of 2011. Both the top line and bottom line were well below the Zacks Consensus Estimates.

Management has slashed its fiscal 2011 financial outlook, mainly driven by the volatile macro-economic condition coupled with significant depreciation of several Latin American currencies in comparison with U.S. dollars. Moreover, stiff competitive scenarios in Latin American markets are other impediments for such a reduced outlook.

We believe intensifying competition and increased promotional expenses may reduce the company's near-term growth opportunities. We do not find any immediate catalysts and expect NII Holdings to report weak financial results for the company's 4th quarter.

NII HLDGS-CL B (NIHD): Free Stock Analysis Report

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JAKKS Pacific (JAKK) – Bear of the Day

admin — Mon, 30 Jan 2012 05:00:01 +0000

Challenging holiday sales hit JAKKS Pacific (JAKK) badly, which consequently made the company cut its fiscal 2011 guidance. The labor shortage in Asia and an increase in input costs also remained a drag on the stock.

An underperformance in the third quarter's top and bottom line makes us cautious on the stock. Hence, we downgrade the stock from Neutral to Underperform recommendation.

Our six-month target price of $13.00 equates to about 13.0x our estimate for 2012. The target price implies an expected total return of negative 10.1% over that period.

JAKKS PACIFIC (JAKK): Free Stock Analysis Report

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Vistaprint NV (VPRT) – Bear of the Day

admin — Fri, 27 Jan 2012 05:00:01 +0000

Vistaprint NV's (VPRT) earnings for the first quarter of fiscal 2012 were well ahead of the Zacks Consensus Estimate. However, we believe that the slow pace of the economic recovery, coupled with huge investments in 2012 and 2013 to attract customers, will restrict improvements in its top as well as bottom lines.

The new set of initiatives also involves increased risk and lack of visibility toward return on investments at the current level. Substantial exposure to international markets also makes the company vulnerable to currency fluctuation risks. In fact, huge concentration in the European market remains a cause of concern owing to the Euro-zone debt crisis.

Our six-month target price of $28.00 equates to 24.6x our earnings estimate for fiscal 2012. This price target implies an expected total negative return of 8.1% over that period. Hence, we downgrade the stock from a Neutral to Underperform recommendation.

VISTAPRINT NV (VPRT): Free Stock Analysis Report

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Bank of America Corp. (BAC) – Bear of the Day

admin — Thu, 26 Jan 2012 05:00:01 +0000

hhgregg, Inc. (HGG) – Bear of the Day

admin — Wed, 25 Jan 2012 05:00:01 +0000

Hhgregg, Inc. (HGG) has recently expressed its apprehension with regard to its third-quarter 2012 earnings to decline to approximately $0.60 per share, from the prior-year quarter of $0.66. The estimate slid on the back of lower than expected margins in the video category owing to the promotional activities across all screen sizes.

Hhgregg also expects advertising expenses to escalate due to the recent initiatives taken up to increase its market share in the appliance and home office categories. In addition, Hhgregg has also launched a mobile product offering to enhance its customers shopping experience. The preliminary third quarter 2012 results also led to a downward revision in fiscal 2012 earnings in the range of $1.05 to $1.15, compared with the previous guidance of $1.26 to $1.41.

Going forward, we expect net sales and operating margins to remain muted owing to the seasonal shopping patterns, rising costs and competitive pressures. Moreover, weakness across the consumer electronics and appliances industry may turn out to be serious headwinds to the top-line. We thus maintain our Underperform rating on the stock.

HHGREGG INC (HGG): Free Stock Analysis Report

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NII Holdings, Inc. (NIHD) – Bear of the Day

admin — Tue, 24 Jan 2012 05:00:01 +0000

We downgrade our recommendation on NII Holdings, Inc. (NIHD) to Underperform backed by our assessment that the company s nightmare will continue in the near future. NII Holdings reported dismal financial results for the third quarter of 2011. Both the top line and bottom line were well below the Zacks Consensus Estimates.

The Goldman Sachs Group (GS) – Bear of the Day

admin — Mon, 23 Jan 2012 05:00:01 +0000

We are downgrading our recommendation on The Goldman Sachs Group (GS) to Underperform from Neutral based on expectation of continued lower top-line as in 2011, coupled with the fundamental pressure on the banking sector. Though the company reported profits, increased operating expenses and lower equity trading revenues remain matters of concern.

Though Goldman has a well-managed global franchise and strong capital base, regulatory issues, including lawsuits, are expected to dent the financials of the company in the upcoming quarters. During 2011, the company was sued by various firms for misrepresenting documents as an underwriter in the sale of mortgage-backed securities. Final judgment on these lawsuits has yet to be determined.

Our six-month price target of $98.00 equates to about 8.5x our earnings estimate for 2012. Combined with the $0.35 per share dividend, the price target implies an expected negative total return of 8.3% over that period, which is consistent with our Underperform recommendation.

GOLDMAN SACHS (GS): Free Stock Analysis Report

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ICICI Bank Ltd. – ADS (IBN) – Bear of the Day

admin — Fri, 20 Jan 2012 05:00:01 +0000

We are downgrading our recommendation on ICICI Bank Ltd. (IBN) to Underperform primarily on rising operating expenses. Net earnings for the second quarter of fiscal 2012 increased, but a substantial increase in operating expenses was the headwind.

We anticipate continued synergies from the company's increased dependence on domestic loans, an almost stable funding base and market leadership in the insurance business. However, we are concerned about ICICI's highly competitive operating environment and below-average credit quality.

Our six-month target price of $26.00 per ADS equates to about 12.3x our earnings estimate for fiscal 2012. This target price implies an expected negative total return of 8.6% over that period. This is consistent with our Underperform recommendation on the ADSs.

ICICI BANK LTD (IBN): Free Stock Analysis Report

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