For Immediate Release
Chicago, IL – December 1, 2011 – Zacks Equity Research highlights DENTSPLY International (NasdaqGS:XRAY - News) as the Bull of the Day and Linear Technology (NasdaqGS:LLTC - News) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Citigroup (NYSE:C - News), Bank of America (NYSE:BAC - News) and American Tower (NYSE:AMT - News).
Full analysis of all these stocks is available at http://at.zacks.com/?id=2678.
Here is a synopsis of all five stocks:
We reaffirm our Outperform recommendation on DENTSPLY International (NasdaqGS:XRAY - News). Its third-quarter fiscal 2011 revenues and earnings outperformed the Zacks Consensus Estimates. Revenues were boosted by internal growth, foreign exchange tailwind and Astra Tech acquisition.
The company beefed up its earnings guidance for fiscal 2011 based on stable market conditions and the contributions of Astra Tech. DENTSPLY should benefit from the gradual recovery in the global dental market. The company's diversified product range and significant investment in product innovation should help it expand its share of the dental implant market.
Moreover, the acquisition of Astra Tech has reinforced its foothold in the global dental market and provided opportunities for attractive synergies. We also feel that the stock offers attractive upside potential at the current level.
Linear Technology (NasdaqGS:LLTC - News) is a leading OEM of analog and mixed signal semiconductors. September quarter results missed the Zacks Consensus, as weak demand, unfavorable mix and a higher tax rate impacted results. Extreme caution regarding customers also led to a weak guidance.
Therefore, despite the strong business model, excellent products and ability to generate strong operating cash flows, we advise investors to avoid the shares, since we believe there is uncertainty in near-term demand. The high debt burden also increases risks.
We think the loss of the iPad business will continue to tell on sentiments. We are therefore reiterating our Underperform recommendation on the shares, as indicated by our $26 target price (14.9X P/E).
Latest Posts on the Zacks Analyst Blog:
Good News on China, Jobs
Monetary policy easing by China's central bank and the very strong ADP jobs report are expected to shift the market's attention from developments in Europe. But as we have all come to appreciate from the market's behavior lately, Europe related headlines remain the biggest draw for the market.
In a major monetary policy change, the People's Bank of China (:PBOC) announced today a 50 basis-point cut in bank reserve requirements, the first since December 2008. The move reverses the Chinese central bank's long-standing monetary tightening stance and is aimed at giving the Chinese economy a helping hand in the face of Eurozone turmoil.
The market will be justified by reading into this move the end of the inflation-fighting phase from the PBOC and the likely beginning of a looser monetary stance going forward. Confirmation of that trend will be a net positive for the Chinese growth outlook and the U.S. stock market.
On the domestic front, we have a busy economic calendar today, with the remainder of this week putting a spotlight on the U.S. labor market. The labor market focus starts with this morning's better-than-expected ADP report and culminates in Friday's November non-farm payroll reading.
In-line with the recent trend of positive U.S. economic readings, the ADP report came significantly better than expected, with 206K jobs created in November. The prior month's tally revised upwards to 130K from the originally reported 110K level. The ADP report is supposed to serve as a preview of the official monthly jobs numbers from the Bureau of Labor Statistics (Toronto:BLS.TO - News) that comes out this Friday.
Today's ADP report is way ahead of market expectations for private-sector jobs in Friday's BLS report. If the ADP report is any indication of things to come on the labor market front, then we will likely get a blockbuster number on Friday.
We have to keep in mind, though, that ADP's track record in foretelling the BLS numbers on a month-to-month basis is less than stellar. We will have to wait till Friday to know the forecast accuracy of today's report. Overall though, this report is expected to cause expectations for Friday's BLS report to go up.
In other corporate news, we have credit rating downgrades for the major U.S. banks, including Citigroup (NYSE:C - News) and Bank of America (NYSE:BAC - News) from the S&P. In other news, American Tower (NYSE:AMT - News), a major telecom infrastructure player, has completed the process to convert itself into a REIT structure.
In other economic news today, we have the Chicago PMI coming out a little later, which has an impressive track record of forecasting national ISM report. We also expect the Fed's Beige book later this afternoon.
Get the full analysis of all these stocks by going to http://at.zacks.com/?id=2649.
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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.
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