For Immediate Release
Chicago, IL – September 11, 2013 – Zacks Equity Research highlights Kirkland's, Inc. ( KIRK- Free Report) as the Bull of the Day and Microsoft Corporation ( MSFT- Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on the DuPont ( DD- Free Report), KBR Inc. ( KBR- Free Report) and The Dow Chemical Company ( DOW- Free Report).
Here is a synopsis of all five stocks:
Bull of the Day:
You know what they say: your home is your castle. Kirkland's, Inc. ( KIRK- Free Report) is perfectly situated to cash in on the growing trend of consumers spending on their homes again. This Zacks Rank #1 (Strong Buy) recently raised full year guidance.
Kirkland's operates 317 home decor stores in 35 states. Founded in Tennessee in 1966, its focus is on the Southeast. It carries home items such as framed art, mirrors, candles, lamps, accent rugs and garden accessories, as well as seasonal merchandise.
On Aug 22, Kirkland's reported its second quarter results and blew by the Zacks Consensus Estimate by 70%. Earnings were a loss of 3 cents compared to the Zacks Consensus which was looking for a loss of 10 cents.
Sales rose 6.7% to $97.1 million compared with the year ago period.
Gross margins rose to 36.7% on reduced promotions.
While traffic remains a "challenge", the company believes it has a strong brand which should extend recent gains into the second half of the year.
After a better-than-expected second quarter, Kirkland's raised its full year EPS guidance to the range of $0.80-$0.90 from $0.75-$0.85.
4 estimates have been raised since the report which has pushed the Zacks Consensus Estimate up to $0.91 from $0.83. The analysts are bullish as that is a penny above the new guidance range.
That's earnings growth of 22.3% in fiscal 2013.
Bear of the Day:
Microsoft Corporation ( MSFT- Free Report) has fallen out of favor with the analysts after missing the earnings estimate last quarter, announcing that longtime CEO Steve Ballmer was retiring, and then entering into a $7.2 billion deal with Nokia. The tech giant has fallen to a Zacks Rank #5 (Strong Sell).
Microsoft makes computer software, provides technology services and also makes devices such as the Microsoft Surface and the XBox game console.
Microsoft's recent troubles began over the summer. On July 18, Microsoft reported its fiscal fourth quarter and missed the Zacks Consensus by $0.15, or 20%. Earnings were just $0.59 compared to the Zacks Consensus of $0.74.
The company said that its results were impacted by the decline in the PC market. It continued to see strong demand for the enterprise and cloud offerings.
With the disappointing earnings report, analysts cut fiscal 2014 estimates. 17 of 21 estimates moved lower in the last 60 days. The Zacks Consensus plunged to $2.76 from $3.08 just 90 days before.
That's just earnings growth of 5%.
Then, on Aug 23, Microsoft announced that long time CEO Steve Ballmer would retire within the next 12 months. The search is on for his successor.
DuPont Extends Contract with KBR
DuPont ( DD- Free Report) has extended its contract with KBR Inc. ( KBR- Free Report), under which the latter will provide contracted construction and maintenance services at DuPont’s Tedlar production facility in Circleville, Ohio.
KBR will provide the services at the Circleville facility under an existing contract with DuPont Electronics & Communications. As per this agreement, KBR offers Construction Management, Engineering design and other related services for DuPont. The renewal of the contract includes an expansion of KBR’s services from 17 sites to 26 DuPont sites across the northeast U.S. and gulf coast regions.
KBR is a global engineering, construction and services company and supports the energy, hydrocarbon, power, industrial, civil infrastructure, minerals, government services and commercial markets. DuPont, a prominent player in the chemical industry along with The Dow Chemical Company ( DOW- Free Report), is committed to constantly explore and innovate science powered solutions in the domains of energy, agriculture, infrastructure, safety and sustainability, and food and nutrition.
DuPont released its second quarter results on Jul 23. The company posted adjusted earnings from continuing operations of $1.28 per share for the quarter, beating the Zacks Consensus Estimate by a penny. The adjusted earnings exclude one-time items including charges associated with customer claims related to the use of an herbicide.
Including one-time items, DuPont logged earnings from continuing operation of $1.10 per share in the quarter compared with $1.15 per share earned in the prior-year quarter. Consolidated net income, as reported, fell 12% year over year to $1.03 billion or $1.11 a share.
Net sales for the second quarter edged down 1% year over year to $9,844 million, as higher sales volumes was more than offset by lower selling prices and unfavorable currency impact. Sales missed the Zacks Consensus Estimate of $10,011 million.
DuPont carries a Zacks Rank #3 (Hold).
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