Zacks Analyst Blog Highlights: Texas Instruments, AutoZone, Inc., International Business Machines, Marriott International Inc. and Cell Therapeutics - Press Releases
For Immediate Release
Chicago, IL – December 10, 2009 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Texas Instruments (TXN), AutoZone, Inc. (AZO), International Business Machines (IBM), Marriott International Inc. (MAR) and Cell Therapeutics (CTIC).
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Here are highlights from Wednesday’s Analyst Blog:
Texas Instruments Raises Guidance
Texas Instruments (TXN) revised its revenue guidance to $2.90 billion-$3.02 billion, an increase of 1-5% from third quarter levels. This takes into account the $120 million seasonal decline in calculator revenue, as well as generally weaker baseband revenue, as the company phases out that business.
The guidance provided at the beginning of the quarter was for revenue of $2.78 billion-$3.02 billion or a decline of 3% to an increase of 5% sequentially. The previous guidance did look a bit conservative to us, so the revision does not come as a surprise. However, the reason for such conservatism is now clearer.
The company is seeing very strong demand, as customers, particularly in automotive, consumer and storage markets for computing are ramping up production. The greater-than-anticipated increase in some product categories is driving the inventory out of mix. This is slowing down production, depleting distributor inventories, extending lead times and resulting in lower revenue.
AutoZone Beats Estimates
AutoZone, Inc. (AZO) posted a 9.1% rise in profit for the first quarter of its fiscal 2010 ended Nov. 21, 2009, driven by expanded parts coverage as well as an improved commercial sales force and hub operating model. The Memphis, Tennessee-based specialty retailer and distributor of automotive replacement parts and accessories showed an earnings per share (EPS) of $2.82, beating the Zacks Consensus Estimate of $2.66. The EPS also improved from the year-ago level of $2.23.
Net sales increased 7.5% to $1.6 billion, while domestic same-store sales (sales for stores open for at least one year) rose 5.6% during the quarter. Gross profit as a percentage of sales went up to 50.3% from 50.1% in the year ago quarter. Gross margin increased by 20 basis points due to the leverage of distribution costs from lower fuel charges as well as improved efficiencies.
AutoZone's inventory advanced 3.5% due to new store openings. However, inventory per store declined to $508,000 from $512,000 last year. Net inventory -- merchandise inventories less accounts payable -- decreased on a per-store basis to $17,000 from $43,000 in the previous year.
IBM Inks Deal in Latin Markets
International Business Machines (IBM) announced a $200 million software agreement with Consist Software Solutions Inc., a leading provider of information technology applications to large and medium-sized companies throughout Latin America. The company chose IBM to help clients transform their businesses and reduce operational costs.
Consist Software Solutions have agreed to standardize all of its products to run on IBM technology, including its DB2 database and Websphere family of middleware products. Consist will provide its clients in the financial services, telecommunications, energy and utilities, government and healthcare industries with new software applications that embed IBM's software portfolio to support new IT infrastructure projects.
This deal is one of the largest for IBM in emerging Latin American markets such as Brazil, and shows that emerging markets remain a notable bright spot for the technology industry.
Marriott Provides Better Guidance
Marriott International Inc. (MAR) has provided a better guidance for the fourth quarter of 2009. The company now expects to add around 38,000 rooms to its worldwide lodging system by the end of 2009. This is up from its previous guidance of gross addition of 33,000 rooms for 2009, which was provided along with its third quarter earnings release in October 2009.
Marriott has also updated its guidance by two percentage points for systemwide revenue per available room (REVPAR) outside North America. The company now expects its systemwide REVPAR to decline by 14% - 16% in the fourth quarter of 2009. However, systemwide REVPAR inside North America is expected to remain in line with the previous guidance of a decline of 13% - 16%.
Marriott has also provided a better outlook for its timeshare business. The company now expects its contract sales of timeshare intervals in the fourth quarter of 2009 to be somewhat better than the previous guidance of $185 million to $190 million. This improvement will be driven primarily due to the realization of a $37 million gain from its note sale securitization during the current fourth quarter and better-than-expected rental profits
Cell Therapeutics’ Positive Data
Cell Therapeutics (CTIC) announced positive data from the pivotal phase III EXTEND (PIX 301) clinical trial of pixantrone in relapsed or refractory, aggressive non-Hodgkin's lymphoma (NHL) patients who have not responded to 2 or more prior therapies. The data were presented at the 2009 American Society of Hematology (ASH) Annual Meeting. Analysis of the additional follow-up data supports the initial clinical trial results.
We are pleased to note that for patients in follow-up period for at least 9 months from the end of treatment, pixantrone provided a 250% relative improvement in 1 year progression free survival or PFS (21% vs 6%) over comparator and a 115% increase in median overall PFS (5.6 months vs 2.6 months). Moreover, at 21 months post treatment, 14% of pixantrone patients remained free from disease progression compared to 3% in the comparator arm.
As a reminder, in August 2009, the US Food and Drug Administration (FDA) accepted for review the New Drug Application (NDA) filed by Cell Therapeutics. The company is seeking FDA approval (NDA filed in June 2009) for pixantrone for the treatment of relapsed and refractory NHL. The company was granted a ten month standard review and has been assigned a Prescription Drug User Fee Act (PDUFA) date of April 23, 2010.
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