Zacks Bull and Bear of the Day Highlights: Tenet Healthcare, China Life Insurance, Groupon, Google and Amazon - Press Releases

For Immediate Release

Chicago, IL - December 5, 2011 - Zacks Equity Research highlights Tenet Healthcare ( THC ) as the Bull of the Day and China Life Insurance ( LFC ) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Groupon Inc. ( GRPN ), Google ( GOOG ) and Amazon ( AMZN ).

Full analysis of all these stocks is available at .

Here is a synopsis of all five stocks:

Bull of the Day :

We are upgrading our recommendation on Tenet Healthcare ( THC ) to Outperform based on its strong operating performance in the recent third quarter, which surpassed the Zacks Consensus Estimate, driven by strong results in all lines of the business, especially the robust performance in outpatient volumes and higher admissions.

New debt financing has improved Tenet's maturity profile and is also likely to reduce the company's future interest payments significantly. Moreover, we believe that volume growth can substantially help boost the earnings outlook of Tenet in future, while also facilitating growth through the acquisitions.

Our six-month target price of $5.50 per share equates to about 12.8x our earnings estimate for 2011. With no dividend supplement, this target price implies an expected total return of 18.3% over that period.

Bear of the Day :

ChinaLife Insurance's ( LFC ) third-quarter earnings witnessed a steep decline from the comparable period of last year. High surrenders, low premium income and increased impairment losses led to a decline in the net income, while increased unrealized losses in the investment portfolio led to reduced shareholders equity.

Additionally, China Life inherently faces substantial interest rate, market and currency risk. Although the company has a strong brand name, it has to deal with considerable competition on the domestic front, which limits earnings growth. However, the debt issue is expected to improve solvency margin, while high liquidity will enable the company to take the high surrender rate in its stride.

Our six-month target price of $35.00 equates to 19.2x our earnings estimate for 2011. Combined with the $0.81 per ADR annual dividend, this target price implies an expected negative total return of 7.1% over that period. This is consistent with our Underperform recommendation on the ADRs.

Latest Posts on the Zacks Analyst Blog :

Daily Deals: The Future in Retail

What has become commonplace for tech companies and others aiming to lower costs is now seeping into the retail segment as well. The idea is the same: outsource routine functions to a specialized party, making them responsible for volumes that could generate higher profits than those shared with them.

This is what the tech companies had been doing previously, although they outsourced the manufacturing function, which is easier to understand given the tangible nature of goods produced. Also, the outsourcing of manufacturing was to lower-cost regions, so the cost advantage was significant. Naturally, the impact on profits was also greater, enabling them to pour funds into R&D and thereby increase product differentiation.


Things are different in retail, however, especially for the small retailers that have been more willing to experiment. Here, store location is of paramount importance, since adequate space is required to stock and display wares, and also attract customers. Therefore, the primary concern for the small retailer is real estate that suits his or her needs.

After selecting the location, there are only a handful of things that the retailer could do to differentiate his or her store from the one next door. This lack of differentiation makes it impossible for retailers to generate high margins, forcing them to compete on price instead.

The retailer's next focus is the generation of traffic. Here, he or she is limited by the physical location of the store. As a result, there is reason for retailers to be interested in companies that send customers to their stores directly. And this is what the specialized companies like recently public Groupon Inc. ( GRPN ) and LivingSocial have been doing. Google ( GOOG ) Offers and Amazon ( AMZN ) Local are other similar services.

Business Model of the "Specialized" Players

The concept started pretty crudely, with the daily deals companies offering coupons that promised huge discounts. The coupon was priced in a manner that could induce the buyer to spend more. However, the system didn't really work, because many customers did not spend the full coupon value and the initiative failed to generate repeat customers.

While the basic concept remains the same, most companies are now changing the rules of the game. They are tracking customer preferences through their registered credit cards to determine the kinds of products that induce a particular customer to repeat the purchase. This information is then being used to create customer profiles.

Customer profile data is perhaps the most valuable asset that these companies possess -- this is their bread and butter. Therefore, companies with a larger customer base (people purchasing coupons) and number of partners (retailers signing up for the service) stand a greater chance of creating valuable information. This clearly makes Groupon the leader in the space since its user and partner bases are both significantly higher than other players.

Moreover, the selection is also broader these days, with electronic goods, events, services and travel joining retail and restaurants. The inclusion of electronic goods is a big positive because this is an area that is expected to attract the largest percentage of consumer discretionary dollars in the next few years.

Get the full analysis of all these stocks by going to .

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 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.

Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today by visiting .

About Zacks is a property of Zacks Investment Research , Inc., which was formed in 1978 by Leonard Zacks. As a PhD from MIT Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank , which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment

Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at .

Visit for information about the performance numbers displayed in this press release.

Follow us on Twitter:

Join us on Facebook:

Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.

Media Contact

Zacks Investment Research

800-767-3771 ext. 9339

AMAZON.COM INC ( AMZN ): Free Stock Analysis Report

GOOGLE INC-CL A ( GOOG ): Free Stock Analysis Report

GROUPON INC ( GRPN ): Free Stock Analysis Report

CHINA LIFE INS ( LFC ): Free Stock Analysis Report

TENET HEALTH ( THC ): Free Stock Analysis Report

Zacks Investment Research

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.

In This Story


Other Topics


Latest Markets Videos


    Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at

    Learn More