For Immediate Release
Chicago, IL – September 9, 2010 – Zacks Equity Research highlights AutoNation (AN) as the Bull of the Day and Lions Gate (LGF) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on LM Ericsson Telephone Co. (ERIC), Motorola Inc. (MOT) and Ciena Corp. (CIEN).
Full analysis of all these stocks is available at http://at.zacks.com/?id=5506.
Here is a synopsis of all five stocks:
Bull of the Day:
AutoNation (AN) remains focused on improving its product mix and cost-cutting initiatives. The company's profit increased 36% in the second quarter of 2010 and surpassed the Zacks Consensus Estimate by $0.02 per share. ALIGN="left"> Cost reduction revolved around lower interest expense, disciplined operations and inventory management. The company's strong new vehicle unit sales are expected to be boosted further by its recent acquisitions of three dealerships. ALIGN="left"> These factors have led us to upgrade our recommendation on the stock from Neutral to Outperform and set a target price of $28.
Lions Gate (LGF) delivered lower-than-expected first quarter 2011 results. The company reported a quarterly loss of $0.54 per share, reflecting a sharp drop from the earnings of $0.25 posted in the prior-year quarter, and missing the Zacks Consensus Estimate of $0.03.
The results were hurt by the fall in the top-line and rise in theatrical marketing costs. The escalating cost of motion picture production and marketing may also jeopardize the company's margins. Moreover, the intense competition from major studios may also result in lower box office receipts.
Last but not least, the company is also currently the subject of a hostile takeover bid from activist investor Carl Icahn, who currently owns a 33.5% stake in the company.
Latest Posts on the Zacks Analyst Blog:
Ericsson and Motorola Form Alliance
LM Ericsson Telephone Co. (ERIC) and Motorola Inc. (MOT), through its Motorola Solutions business unit, have entered into an alliance to provide the next generation of mobile communication technology, LTE. Through this alliance, the companies aim to extend a safe communication system to the public using mobile broadband, providing a high speed and safe internet solution.
With the rising rate of communication through mobile internet, it has become extremely necessary to ensure safe communications for the public. LTE, a mobile broadband technology from Ericsson, will aid Motorola's unified next generation platform to provide a highly developed communications means required for public safety. The new system helps in transmitting large number of data quickly, efficiently and economically. It helps users to promptly access huge number of applications and in future is expected to be installed in the new and improved mobile internet applications.
Ericsson, a leading provider of LTE technology, has signed eight contracts worldwide for LTE with six major operators. The company’s three alliance partners are in the U.S., which is the fastest growing LTE market worldwide. Ericsson expects to become the largest patent holder in the industry for LTE by gaining 25% patents for the next generation of mobile communication technology.
As a technology and market leader in wireless equipment (based on the GSM standard), Ericsson stands to benefit from the continued growth of the wireless industry, especially in the emerging markets. GSM-based network expansions in the emerging markets (including Latin America, Eastern Europe, Africa, China and India) are expected to drive moderate revenue growth over the next several years.
Ciena Beats but Loss Widens
Telecommunications network specialist Ciena Corp. (CIEN) reported third quarter fiscal 2010 loss of $16.7 million or 18 cents per share (including Nortel’s assets), which increased from a loss of $13.4 million or 15 cents in the year-ago quarter.
Earnings include stock based compensation charges but exclude one time items such as amortization of intangibles, fair value adjustment of acquired inventory, acquisition and integration as well as restructuring costs, loss on cost method investments and loss on fair value of embedded derivative on 4% convertible note.
Excluding stock based expenses, amortization of intangibles and one-time charges, adjusted loss per share of 9 cents was up from the year-ago quarter’s loss of 5 cents per share. However, the results were better than the Zacks Consensus Estimate of a loss of 44 cents.
This was the first full quarter to include the operations of Nortel Networks’ Metro Ethernet Networks (MEN) business, acquired on March 19, 2010. The quarter included $17.0 million in acquisition and integration-related expenses associated with the acquisition of the optical networking and carrier Ethernet assets of Nortel’s MEN business.
Get the full analysis of all these stocks by going to http://at.zacks.com/?id=5507.
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AUTONATION INC (AN): Free Stock Analysis Report
CIENA CORP (CIEN): Free Stock Analysis Report
ERICSSON LM ADR (ERIC): Free Stock Analysis Report
LIONS GATE ETMT (LGF): Free Stock Analysis Report
MOTOROLA INC (MOT): Free Stock Analysis Report
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