For Immediate Release
Chicago, IL – June 1, 2010 – Zacks Equity Research highlights Cosan Limited (CZZ) as the Bull of the Day and Nokia (NOK) the Bear of the Day. In addition, Zacks Equity Research provides analysis on American International Group Inc. (AIG), Bank of America Corp. (BAC), MetLife Inc. (MET) and Prudential Plc. (PUK).
Full analysis of all these stocks is available at http://at.zacks.com/?id=5506.
Here is a synopsis of all five stocks:
Cosan Limited (CZZ), one of the world's largest producers of sugar and ethanol, has been growing through acquisitions and other expansion strategies. The recently built Jata? mill is expected to boost production in the near term.
There is a lot of room for new investments and for a huge increase in Brazilian production in the following years. The Cosan-Shell joint venture would ensure better growth prospects, improvement in debt profile, setting up of a material and profitable bio-fuels business, and potential for development of next generation technologies.
Thus, we are upgrading our recommendation from Neutral to Outperform on the ADR. Our current target price is $10 per share.
Nokia (NOK) is facing serious problems in the high-end feature-rich smartphone segment. Smartphones are expected to become the next-generation choice, taking over the market share from basic mobile handsets. As of now, unfortunately, Nokia has failed to introduce any smartphone to ably compete with BlackBerry, iPhone or any Android-based handsets.
Nokia's inability in the high-margin lucrative smartphone market will put more pressure on its earnings going forward. Feature-rich software and services are the main characteristics of any smartphone, which Nokia seriously lacks. There is no near-term visibility about the launch of the upgraded Symbian.
Additionally, the company's network infrastructure solutions wing is still facing economic headwinds. We downgrade our recommendation to Underperform due to the absence of any catalyst.
Latest Posts on the Zacks Analyst Blog:
AIG Plans to Offload AGF
In order to attain funds for repaying the government’s bailout amount, on Wednesday, American International Group Inc. (AIG) reportedly publicized its intentions to vend off its consumer finance unit, American General Finance (AGF), according to the Financial Times. However, the amount AIG expects to raise from the AGF sale or the preference of any buyer remains undisclosed.
AGF constitutes 1,200 branches with 1 million customers across the U.S. In 2009, this AIG unit recorded an operating loss of $800 million due to loan defaults in lower-income consumers segment that soared given the downturn in the funding market. Hence, AIG has been reportedly hunting for potential buyers and has appointed Bank of America Merrill Lynch, a wing of Bank of America Corp. (BAC) to organize and sell its non-core consumer finance unit, in order to raise money for Troubled Asset Relief Program (TARP) repayment.
While some undisclosed buyers are interested in the deal, the risks of current market volatility and inability of short-funding in AGF are expected to adversely affect the process of sale and its final pricing.
AIG is desperately seeking the asset-sale approach to get rid of the government bailout loan of about $180 billion, taken during the height of financial crisis in 2008. Currently, the U.S. government enjoys about 80% stake in AIG. Accordingly, AIG is progressing steadily with its divestiture program to repay the government loan. Alongside, an acquisition of AIG’s American Life Insurance Co. (ALICO) unit for about $15 billion remains pending with MetLife Inc. (MET) and is expected to close by the end of 2010.
Further, AIG is also working on to divest its Asian life-insurance unit, American International Assurance (AIA) to U.K.’s Prudential Plc. (PUK), whereby Prudential can help attain a leading position in the Asian markets. Subject to other closing terms of the deal, the transaction is expected to close by the end of 2010.
Get the full analysis of all these stocks by going to http://at.zacks.com/?id=5507.
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