For Immediate Release
Chicago, IL - January 19, 2012 - Zacks Equity Research
highlights
Lamar Advertising Co.
(
LAMR
) as the Bull of the Day and
HDFC Bank
(
HDB
) as the Bear of the Day. In addition, Zacks Equity Research
provides analysis on
Medivation, Inc.
(
MDVN
),
Pfizer Inc.
(
PFE
) and
Johnson & Johnson
(
JNJ
).
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
:
Lamar Advertising Co.
(
LAMR
) reported quite an improvement in the third quarter results with
earnings per share of $0.04, exceeding the year-ago reported
earnings of $0.01. Net revenue jumped 3.2% y/y and exceeded
management's guidance by 1.3%. Moreover, the company's debt level
plummeted in the quarter, bringing down the interest expense by
6.2%.
Accounting for these positive factors and anticipating further
improvements in the advertising market in 2012 in the backdrop of
reviving US economy, we upgrade our recommendation on Lamar from
Neutral to Outperform. The Zacks estimate for 2012 also represents
a significant increase.
The company is currently trading at a Price-to-Cash Flow (P/CF)
multiple of 9.0x. We believe the company will outperform the
broader market going forward. Our target price is $35.00, based on
P/CF of 10.3x.
Bear of the Day
:
HDFC Bank's
(
HDB
) higher operating expenses were the headwind in the company's most
recently reported quarter. The company is still exposed to threats
related to higher cost of funds. Growing competition in the retail
space with the re-entry of peers is an added future concern.
Our six-month target price of $25.00 per ADS equates to about
22.3x our earnings estimate for fiscal 2012. This target price
implies an expected negative total return of 7.6% over that period.
This is consistent with our long-term Underperform recommendation
on the ADSs.
Additionally, the quantitative Zacks Rank for HDFC Bank is
currently #4, indicating a likelihood of downward pressure on the
ADSs over the near term.
Latest Posts on the Zacks
Analyst Blog
:
Pfizer, Medivation Call It Quits
Medivation, Inc.
(
MDVN
) and
Pfizer Inc.
(
PFE
) are finally giving up on their efforts to develop Alzheimer's
candidate, dimebon (latrepirdine), with the companies reporting
disappointing results yet again on the candidate. This time,
dimebon failed to achieve the co-primary endpoints in a phase III
study, CONCERT, which was conducted in patients with
mild-to-moderate Alzheimer's disease.
Medivation and Pfizer said that dimebon failed to achieve
statistical significance for either of the two co-primary endpoints
(Alzheimer's Disease Assessment Scale and Alzheimer's Disease
Cooperative Study - Activities of Daily Living [ADCS-ADL]) of
the study.
Expectations Were Already Low
The study results did not come as a huge surprise. We had low
expectations from the CONCERT study given dimebon's dismal track
record. Medivation and Pfizer had already suffered two major
setbacks where dimebon's development program is concerned.
Way back in March 2010, dimebon had failed to achieve both its
primary and secondary endpoints in a phase III study for
Alzheimer's. Then, in April 2011, dimebon failed to achieve the
primary endpoints in a phase III study for Huntington disease.
With dimebon failing in the CONCERT study, Medivation and Pfizer
have decided to discontinue the development of the candidate for
all indications, including an ongoing open label extension study in
Alzheimer's disease.
End of the Road for Pfizer-Medivation
Collaboration
The disappointing CONCERT data also marked the end of the
collaboration agreement between Medivation and Pfizer for dimebon.
Once again, the termination of the agreement did not surprise us -
firstly, Pfizer already has another Alzheimer's candidate,
bapineuzumab, in its portfolio that is being developed with
Johnson & Johnson
(
JNJ
).
Secondly, Medivation's future lies with its prostate cancer
candidate, MDV3100, which delivered impressive interim data in Nov
2011. The company and partner Astellas could be in a position to
file for US approval in 2012.
Our Take
The termination of the dimebon deal signifies yet another
pipeline failure for Pfizer. At the time of signing the agreement,
Pfizer had made a payment of $225 million to Medivation. As far as
Medivation is concerned, the shares were not affected significantly
by the CONCERT results - this indicates that expectations from this
study and the candidate were already very low.
Investor focus had already shifted to MDV3100. Medivation and
partner Astellas are all set to conduct a pre-NDA meeting with the
FDA in early 2012. We believe the companies will file for
regulatory approval soon thereafter and expect MDV3100 to hit the
market in 2013.
Based on the data that we have seen so far, we believe MDV3100
has blockbuster potential and could be a game-changer for
Medivation. We currently have Neutral recommendations on both
Pfizer and Medivation. Both companies carry a Zacks #3 Rank
(short-term Hold rating).
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
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and events impacting stocks and the financial markets.
About Zacks Equity Research
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Continuous analyst coverage is provided for a universe of 1,150
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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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HDFC BANK LTD (
HDB
): Free Stock Analysis Report
JOHNSON & JOHNS (
JNJ
): Free Stock Analysis Report
LAMAR ADVER CO (
LAMR
): Free Stock Analysis Report
MEDIVATION INC (
MDVN
): Free Stock Analysis Report
PFIZER INC (
PFE
): Free Stock Analysis Report
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