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Axcelis Technologies, Gigamon and Sears Holdings highlighted as Zacks Bull and Bear of the Day

For Immediate Release

Chicago, IL - February 13, 2017 - Zacks Equity Research highlights Axcelis Technologies (NASDAQ: ACLS - Free Report ) as the Bull of the Day and Gigamon Inc. (NYSE: GIMO - Free Report ) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Sears Holdings ( NASDAQ: SHLD - Free Report ).

Here is a synopsis of all three stocks:

Bull of the Day :

The semiconductor sector has been hot as of late, and these companies are producing more efficient and powerful products. But at many times, these companies outsource some of their parts for production. That is where our Zacks Bull of the Day comes in, Axcelis Technologies (NASDAQ: ACLS - Free Report ).

This Zacks Rank #1 (Strong Buy) company is a leading producer of ion implantation equipment used in the fabrication of semiconductors. The company also produces dry strip, photostabilization and rapid thermal processing equipment, which is used in semiconductor manufacturing primarily before and after the ion implantation process. In addition, the company provides extensive aftermarket service and support, including spare parts, equipment upgrades, maintenance services and customer training.

Recent Earnings Results

On February 1st, management posted Q4 earnings results where they beat the Zacks consensus earnings estimate, and came in just shy of the Zacks consensus revenue estimate. The company saw sequential gains in revenues +5.6%, operating profit +63.9%, net income +81.2%, and cash, and cash equivalents +7.2%.

Further, the company saw gross margins improve by 220 basis points to a near record level of 37.3%. Management is targeting gross margins of 40% by Q4 17, and they are currently ahead of that goal, one year out. The company has been focused on efficiency and product optimization mix to achieve the 40% gross margin target.

Management's Take

According to Mary Puma, President and CEO, " 2016 was a strong year for the Purion platform as our customer base expanded significantly, and we successfully introduced several new product extensions. We expect 2017 to be the start of a solid up cycle for the industry, with robust implant CAPEX spending, providing Axcelis with substantial opportunities for continued growth .

" I am pleased with our financial performance in 2016. We increased gross margins to 37.3%, up from 33.7% in 2015," said Chief Financial Officer and Executive Vice President Kevin Brewer. "We expect to realize further improvements in gross margin in 2017 with continued focus on supply chain optimization, value engineering and lean programs ."

Bear of the Day :

A convergence of several unfavorable situations can negatively impact a company's top and bottom line very quickly. This is what happened to our Zacks Bear of the Day, Gigamon Inc. (NYSE: GIMO - Free Report ), they experienced a combination of a lower seasonal spending, slowing purchases by vendors, and a decline in spending in a company's security segment.

This Zacks Rank #5 (Strong Sell) company is engaged in providing intelligent Traffic Visibility solutions for enterprises, data centers and service providers. Its products consist of GigaVUE, GigaSECURE, GigaSMART and GigaTAP products. The Company's fabric enables information technology organizations to forward traffic from network infrastructure to management, analysis, and compliance and security tools. It has operations primarily in the United States, the rest of North America, Europe, the Middle East, Africa, and the Asia Pacific. Gigamon Inc. is headquartered in Milpitas, California.

Recent Earnings Results

Last week, management posted Q4 16 results, and they significantly missed the Zacks consensus earnings estimate, but met the Zacks consensus revenue estimate. Management had previously negatively preannounced their Q4 16 guidance, so expectations were significantly tempered before the announcement. Further, management announced guidance for Q1 17, and it was well below expectations; revenues in a range of $67-70 million (below the previously expected $80 million), pro-forma EPS in a range of $0.04-0.08 (well below the previous expectation of $0.26 estimate).

Management's Take

According to Paul Hooper, CEO, " Gigamon delivered the second consecutive year of 40% year-over-year revenue growth as we continue to demonstrate leadership in this exciting growth market. Our 2016 financial performance is a testimony to our leadership, the demand for visibility to information-in-motion, and the value we deliver to our customers as they secure, manage and understand the complex world of information. During the year, we extended our addressable market by delivering the first to market solution for visibility into the Amazon Web Services cloud and enhanced our security platform in 2016. With our strong leadership in the industry, we believe our security-enabling platform for private, public and hybrid clouds has become an essential component of modern IT infrastructure ."

Additional content:

Sears Skyrockets 30% on New $1 Billion Cost Cuts

On Friday, shares of struggling retailer Sears Holdings ( NASDAQ: SHLD - Free Report ) are skyrocketing, up around 32% to $7.33 per share in morning trading-and up nearly 44% in premarket trading -after the company announced a plan to cut costs by at least $1 billion in 2017.

The plan includes slashing debt and pension obligations by at least $1.5 billion, reducing overhead, improving merchandise at its stores, and bettering inventory management. Sears also hopes to more closely integrate its namesake and Kmart operations.

Edward S. Lampert, Sears' Chairman and CEO said, "We believe the actions outlined today will reduce our overall cash funding requirements and ensure that Sears Holdings becomes a more agile and competitive retailer with a clear path toward profitability."

"In addition, we believe these actions will enable us to focus our investments to drive our strategic transformation and the evolution of our Shop Your Way ecosystem through value enhancing partnerships, compelling offerings and a seamless online and in-store shopping experience for our members," Mr. Lampert continued.

Sears also announced that it amended an existing deal with its creditors that will allow it to borrow an additional $140 million, helping the retailer as to shutters more stores and tries to invest more in its online operations.

The once-great American department store has had a rough 2017 so far. In January, it announced plans to close 150 Sears and Kmart stores, and shares of SHLD have plummeted 40% year-to-date, hitting their lowest in recent days since Sears merged with Kmart in 2005 on bankruptcy fears.

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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 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 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.

Strong Stocks that Should Be in the News

Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year. See these high-potential stocks free >>.

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Axcelis Technologies, Inc. (ACLS): Free Stock Analysis Report

Gigamon Inc. (GIMO): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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