For Immediate Release
Chicago, IL – October 1, 2013 – Zacks Equity Research highlights E-House China Holdings Limited ( EJ- Free Report) as the Bull of the Day and Tumi Holdings, Inc. ( TUMI- Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on the AstraZeneca ( AZN- Free Report), Nektar Therapeutics ( NKTR- Free Report) and Roche ( RHHBY- Free Report).
Here is a synopsis of all five stocks:
Bull of the Day:
China's housing market is red hot again. E-House China Holdings Limited ( EJ- Free Report), one of China's largest real estate agencies, has beaten the Zacks Consensus Estimate by wide margins the last 3 quarters. This Zacks Rank #1 (Strong Buy) is expected to see triple digit growth in 2013 and 2014.
E-House provides real estate services in about 250 cities in China including online advertising and e-commerce, acting as a primary sales agency, secondary brokerage services, information and consulting services and real estate management.
On Aug 16, E-House reported its second quarter results and blew by the Zacks Consensus Estimate by 300%. Analysts had expected a loss of $0.04 but E-House reported profit of $0.08.
Revenue jumped 43% to $163.4 million led by the real estate agency group and online services. Online services saw revenue soar 79% to $71.9 million. The real estate agency services group saw revenue rise 38% to $62.6 million.
Online services has been two years in the making. The upgraded 3.0 version of the e-commerce platform launched to customers on June 18. As of Aug 15 it had signed 986 e-commerce contracts with its developer clients. This platform is expected to be a big revenue driver in future quarters.
After a huge second quarter, E-House raised its full year revenue guidance to $630 million from its previous guidance of $600 million. That's a 36% increase from 2012 which had revenue of $462.4 million.
Bear of the Day:
Not all luxury brands are created equal. Tumi Holdings, Inc. ( TUMI- Free Report) lowered full-year earnings and sales guidance in August. This Zacks Rank #5 (Strong Sell) is expected to grow earnings only 6.6% in 2013.
Tumi operates 200 stores globally and sells premium travel and business products including totes, handbags and luggage.
On Aug 7, Tumi reported second quarter results and missed the Zacks Consensus by 2 cents. Earnings were $0.18 compared to the Zacks Consensus of $0.20. Revenue jumped 13% to $108.2 million from the year ago quarter.
However, comparable store sales comps came in at just 4.6% compared to 16.4% in the first quarter and 8% in the year ago second quarter. The comparable store sales included e-commerce sales.
Domestic store traffic slowed "modestly." This brought Direct-to-Consumer North America comparable store sales, excluding e-commerce, down to an increase of just 1.7% from 7.2% in the second quarter of 2012.
While Tumi maintained a positive outlook for the year, it also reduced both its earnings and revenue guidance.
Revenue growth is now expected at 16%-18% compared to its previous guidance of 18% to 20%.
Earnings guidance was revised down to a range of $0.76-$0.82 from $0.82-$0.86 with some of the revision due to the expense of redesign of the web site.
Pipeline Progress at AstraZeneca
AstraZeneca ( AZN- Free Report) recently announced that the European Medicines Agency (:EMA) has accepted the Marketing Authorisation Application ( MAA) for two of its candidates – olaparib and naloxegol.
AstraZeneca is looking to get olaparib approved as a maintenance therapy in BRCA mutated relapsed serous ovarian cancer patients, who have shown response to platinum-based chemotherapy in the EU.
The MAA for olaparib was submitted on the basis of a phase II study. The phase II study compared the efficacy and safety of olaparib versus placebo in patients suffering from platinum-sensitive, relapsed, high grade serous ovarian cancer. The patients had already been treated with two or more platinum-based regimens and exhibited a partial or complete response to the last platinum-based treatment regimen. A subgroup analysis revealed that olaparib significantly improved progression-free survival as compared to placebo.
Meanwhile, AstraZeneca is also seeking to market Naloxegol in the EU for the treatment of opioid-induced constipation in adults.
The MAA for Naloxegol was submitted on the basis of encouraging data from the phase III KODIAC program. AstraZeneca had licensed the candidate from Nektar Therapeutics ( NKTR- Free Report) in Sep 2009. The acceptance of MAA by the EMA triggered a $25 million milestone payment from AstraZeneca to Nektar Therapeutics.
AstraZeneca’s pipeline is currently under severe pressure with revenues plunging due to generic competition faced by several key drugs including Seroquel. We believe that approval of these candidates would provide a much needed boost to AstraZeneca’s revenues.
AstraZeneca carries a Zacks Rank #3 (Hold). Currently, companies like Roche ( RHHBY- Free Report) look well-positioned with a Zacks Rank #1 (Strong Buy).
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