For Immediate Release
Chicago, IL - March 9, 2012 - Zacks Equity Research highlights
Cabela's, Inc.
(
CAB
) as the Bull of the Day and
KB Home
(
KBH
) as the Bear of the Day. In addition, Zacks Equity Research
provides analysis on
Williams-Sonoma
(
WSM
),
Navistar
(
NAV
) and
Stein Mart
(
SMRT
).
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
:
Cabela's, Inc.
(
CAB
) fourth-quarter 2011 earnings of $1.06 per share beat the Zacks
Consensus Estimate of $0.99, and surged 23.3% from the prior-year
quarter. The quarter witnessed healthy revenue growth and
profitability at its retail segment, improved performance at
Cabela's CLUB Visa program, increased merchandise gross margin and
boost in market share.
Merchandise gross margin expanded 40 basis points to 36.4%
during the quarter. Management reiterated its long-term goal of
increasing the margin by 200-300 basis points. Driven by improving
trends, the company now expects earnings to increase at a
double-digit rate in fiscal 2012.
The company is looking to enhance its retail square footage
growth and focusing on next-generation store and new Outpost store
formats. Moreover, the company remains committed on alleviating bad
debt risk in its credit card business. The gradual improvement in
the economy has lowered delinquencies and charge-offs.
Bear of the Day
:
KB Home
(
KBH
) faces a fragile housing market. Increased availability of housing
alternatives may keep the company's earnings under pressure.
Furthermore, the company's housing market is highly concentrated,
which poses threats to its earnings performance.
The company did post a profit of $0.18 per share during the
fourth quarter of fiscal 2011, which was much higher than the Zacks
Consensus Estimate of $0.03. Nevertheless, the negative factors
have led us to downgrade the recommendation on shares of KB Home
from Neutral to Underperform with a target price of $10.00.
Our long-term Underperform recommendation on the stock indicates
that it will perform lower than the overall market. Our $10 target
price, 25.0X our 2013 EPS estimate, reflects this view.
Latest Posts on the Zacks
Analyst Blog
:
Optimism on Greek Bonds, U.S. Jobs
Greece's private sector bond swap, whose uncertain fate had
gripped the markets in recent days, appears to be attracting enough
participation to make the deal binding on all bondholders.
The details of the swap will come out Friday morning, but
growing optimism about the deal is helping bring down the yields on
Italian and Spanish government bonds, which had started creeping
back up in recent days.
Friday morning not only clears up the air on the Greek
situation, but will also likely confirm the recent improving trend
in the U.S. labor market though the February non-farm payroll
report. This morning's modestly weaker-than-expected Initial
Jobless Claims report nevertheless confirms the improving jobs
picture, helping build expectations of a strong labor reading
tomorrow. The expectation is that a favorable labor market read on
Friday will serve as the key catalyst to push stocks above
resistance levels.
Initial Jobless Claims came in a tad weaker than expected last
week - up 8K to 362K vs. expectations of a lower rise. The prior
week's tally was modestly revised upwards to 354K from the
originally reported 353K. The four-week average, which smoothes out
the week-to-week fluctuation, moved up by a mere 250 to 355K.
This week's modest 'miss' notwithstanding, the overall trend in
the labor market has consistently been in favorable direction
lately. It will be interesting to see if Friday's jobs report will
further confirm this trend.
On the earnings front,
Williams-Sonoma
(
WSM
), the home furnishings retailer, beat earnings and revenue
expectations and guided higher. Results at truck maker
Navistar
(
NAV
) and retailer
Stein Mart
(
SMRT
) came short of expectations.
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 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
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which to sell for the long-term.
Continuous analyst 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.
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CABELAS INC (
CAB
): Free Stock Analysis Report
KB HOME (
KBH
): Free Stock Analysis Report
NAVISTAR INTL (
NAV
): Free Stock Analysis Report
STEIN MART INC (
SMRT
): Free Stock Analysis Report
WILLIAMS-SONOMA (
WSM
): Free Stock Analysis Report
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