Zacks Analyst Blog Highlights: Bank of America, Citigroup, Amdocs, Vonage Holdings and Convergys - Press Releases

For Immediate Release

Chicago, IL – June 10, 2010 – Zacks.com Analyst Blog features: Bank of America Corp. (BAC), Citigroup (C), Amdocs Ltd. (DOX), Vonage Holdings Corporation (VG) and Convergys Corporation (CVG).

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Here are highlights from Wednesday’s Analyst Blog:

BofA to Expand Health Coverage

Bank of America Corp. (BAC) said on Tuesday that in order to partly comply with the government’s requirements under the new federal health care regulation in advance, it is planning to expand health care coverage for its employees' dependents up to 26 years of age.

BofA's existing plan covers employees’ dependent children up to age 19. For the dependent family member, who is a full-time student, the existing coverage is up to age 24.

The health care law signed in March 2010 requires dependent children to be covered on an employee's family health plans up to age 26. As a result, starting September 15, 2010, BofA’s currently enrolled dependent children aged 19 to 26 will be covered.

According to BofA CEO, Brian Moynihan, this advance action represents the company’s continued investment in its human resources.

BofA’s first quarter 2010 earnings came in at 28 cents per share, substantially ahead of the Zacks Consensus Estimate of 9 cents. However, this compares unfavorably with the earnings of 44 cents in the prior-year quarter.

Strong capital markets activity and lower provision for credit losses were the primary factors that helped BofA bounce back to profitability after incurring significant losses for the last couple of quarters.

The market turmoil was more harmful to BofA than its peers except Citigroup (C). However, BofA concluded its biggest acquisitions in this period. Following the acquisition of Countrywide in July 2008, the company acquired Merrill Lynch almost during the height of the financial crisis last year.

DOX and Vonage Join Forces

Amdocs Ltd. (DOX) has entered into a managed services agreement with Vonage Holdings Corporation (VG), one of the leading companies providing high-quality voice and messaging services over broadband networks with a subscriber base of 2.4 million.

Under the five-year agreement, Amdocs will provide business support systems (BSS) to Vonage’s U.S., Canadian and United Kingdom operations. BSS solution enables better sales through quicker product launch, effective promotions, and customer service as well as improvement of operational efficiencies and reduction of costs. We believe these long-term service agreements have over the years strengthened the company’s customer base and product offering in the industry.

Amdocs stands well-positioned to leverage a long-term trend toward information technology (IT) outsourcing. The company targets leading companies in the communications business by offering a total systems solution, consisting of its integrated customer management products along with its specialized services. This has made Amdocs steadily gain market share from its competitors.

As of the end of the second quarter of 2010, Amdocs had a 12-month backlog of $2,460.0 million, up from the first quarter backlog of $2,425.0 million. Taking into consideration the business trends and solid backlog, the company anticipates achieving at least 1% to 2% sequential quarterly revenue growth (in constant currency) throughout fiscal year 2010.

Amdocs is the dominant provider of customer relationship management (CRM) and billing systems to the communications service providers. However, the company has little exposure as a supplier of billing systems for the cable industry. DOX competes with several independent suppliers of information systems and services, including Convergys Corporation (CVG).

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