The Zacks Analyst Blog Highlights: Highwoods Properties, Wells Fargo, Leucadia National, Moody's and Range Resources

Zacks

For Immediate Release

Chicago, IL – August 9, 2013 – 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 Highwoods Properties Inc. (HIW-Free Report), Wells Fargo & Company (WFC-Free Report), Leucadia National Corporation (LUK-Free Report), Moody's Corporation (MCO-Free Report) and Range Resources Corporation (RRC-Free Report).

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

Here are highlights from Thursday’s Analyst Blog:

Highwoods Offers Shares to Repay Debt

Highwoods Properties Inc. (HIW-Free Report) – a real estate investment trust (:REIT) – recently announced the offering of 3.75 million equity shares to repay debt. In addition, to cover any over-allotments, the company decided to provide a 30-day option to underwriters to buy an additional 0.56 million shares.

Highwoods expects to use the proceeds from this offering to pay off the outstanding debt under its unsecured revolving credit facility worth $475 million. Further, the company intends to use the remaining amount to finance proposed strategic acquisitions and developments as well as for meeting other corporate needs.

Notably, Wells Fargo Securities, LLC, an investment banking division of Wells Fargo & Company (WFC-Free Report), and Jefferies LLC, a wholly-owned subsidiary of Leucadia National Corporation (LUK-Free Report) will serve as underwriters of the equity offering.

This offering will enable Highwoods to attain financial flexibility and position it favorably to pursue investment opportunities and acquisitions. This will consequently go a long way in enhancing top-line growth. Notably, Highwoods exited the second quarter with $10.1 million of cash and cash equivalents.

Last month, Highwoods reported second-quarter 2013 core funds from operations (:FFO) of 70 cents per share, beating the Zacks Consensus Estimate by a penny. Decent results came on the back of strong leasing and efficient capital deployment activity as well as cash NOI growth. Moreover, on the back of accretive acquisitions, Highwoods’ expectation for the rest of the year increased and it was prompted to raise its full-year FFO per share guidance for 2013.

Highwoods’ effort to enhance its liquidity position and improve portfolio quality has been recognized by rating agencies in recent times as well. The company received a senior debt rating upgradation from Standard & Poor's Ratings Services (raised to BBB, from BBB-, with a stable outlook in July) as well as Moody's Investors Service, the rating arm of Moody's Corporation (MCO-Free Report) (Baa2, from Baa3, with a stable outlook in June). These activities preserve investor confidence in the stock and helps boost its creditworthiness in the market.

Highwoods currently carries a Zacks Rank #2 (Buy).

Range Resources Upped to Strong Buy

On Aug 5, we upgraded independent oil and gas company, Range Resources Corporation (RRC-Free Report) to Outperform based on its improved prospects. Range Resources became a Zacks Rank #1 (Strong Buy) stock shortly after reporting impressive second-quarter results.

Why the Upgrade?

Earnings estimate revisions for Range Resources have been portraying an uptrend following healthy second-quarter 2013 results. In the last 30 days, the Zacks Consensus Estimate jumped from 6 cents to 81 cents for 2013, while it increased from 82 cents to $1.42 for 2014.

Recently, Range Resources trumped the second-quarter 2013 Zacks Consensus Estimate of a loss of $0.02 with its adjusted earnings of $0.34 a share. Results also increased from the year-earlier adjusted profit of $0.11 a share.

It is also encouraging that the company has surpassed the Zacks Consensus Estimate by an average of 596.56% in the trailing four quarters. We believe that the company’s strategic initiatives toward lowering costs and driving margins position it well to sustain growth momentum in the future.

We are hopeful that Range Resources’ record production growth profile, along with its sale of non-core properties, will prove beneficial over time. Additionally, the robust asset base of Range Resources, especially in the Marcellus Shale and horizontal Mississippian plays, will help in the growth of the company. For full-year 2013, the company maintains its strong production growth guidance of 20% to 25%.

Range Resources is an independent oil and gas company engaged in the exploration, development and acquisition of oil and gas properties. Its diversified asset portfolio is spread between low-risk/long reserve-life Appalachian assets and large-volume/rapid-payout Gulf Coast properties.

 

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