For Immediate Release
Chicago, IL – September 30, 2013 – Zacks Equity Research highlights Boston Beer Company ( SAM - Free Report ) as the Bull of the Day and Bancolombia ( CIB - Free Report ) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on the Facebook ( FB- Free Report ), Zynga ( ZNGA- Free Report ) and Electronic Arts ( EA- Free Report ).
Here is a synopsis of all five stocks:
Bull of the Day:
While giant brewers like Budweiser and Molson Coors still dominate the U.S. beer market, craft brewers have managed to carve out a decent sized niche for themselves. And on a recent ‘fact finding mission’ that I took to the headquarters of Boston Beer Company ( SAM - Free Report ) in Massachusetts, I can see why many have embraced these smaller brewers.
Not only do companies like SAM offer an arguably better beer, but you can tell that there is a great level of care put into the product as well. Many consumers have noticed the flavor—or at least the uniqueness-- and have allowed SAM to grow into the great position it finds itself in today.
Yet even with the solid level of growth that the company has seen so far, SAM makes up less than 1.5% of the total U.S. market, suggesting that Boston Beer clearly has plenty of room to grow. For this reason, and America’s current obsession with craft beer, this brewer of Boston Lager could be worth a closer look.
SAM in Focus
The growth for SAM can best be seen in the recent earnings estimate revision trends for the company. Analysts clearly like the craft beer story too, as not a single estimate has gone lower for SAM in the past 60 days, while when zeroing in on the current year, three estimates have gone up.
The magnitude of the increases has also been impressive, with the current year surging from $5/share 90 days ago, to the current level at $5.36/share. Current quarter estimates have also jumped, suggesting that analysts are quite bullish on the company’s prospects.
Bear of the Day:
Many emerging markets have had a rough 2013. Outflows from developing nations have been a serious problem as weak currencies and a desire for more U.S. exposure have led to huge losses.
While the focus of this selling pressure has largely been on big Asian markets like India or Indonesia, Latin America hasn’t been immune either. This region has also struggled over the past six months, as commodity prices have been somewhat sluggish overall, and a risk-off trade in these nations hasn’t helped matters.
Although Brazil usually leads the way in this regard, investors should be aware of Colombia too. The nation had been a star performer for quite a while, but it has fallen on hard times lately. Plus, a program by the central bank to weaken the peso—which arguably helps exporters—doesn’t exactly have a positive impact for U.S. investors in the meantime.
Thanks to these factors, the once-star performer of Bancolombia ( CIB - Free Report ) is probably a stock that you want to avoid for the time being.
Bancolombia is the largest commercial bank in Colombia, offering a full range of financial products. The firm is based in Medellin and it has nearly 1,000 offices, though its network stretches to other Latin American countries, and the U.S. and Spain as well.
CIB surged in the aftermath of the financial crisis as demand for emerging markets were strong, as prices moved from under $20 a share in 2009, to over $60 in mid-2010. Lately however, prices hit just above the $70/share mark and have had trouble maintaining that lofty level ever since. In fact, CIB’s shares have declined by 15.6% YTD, including an 8.7% slump in the past six months.
Candy Crush Creator Files for IPO
King.com, maker of the popular mobile game Candy Crush Saga, filed for IPO. King.com filed Pre-IPO "S-1" paperwork with the Security and Exchange Commission. Details of the company's initial public offering are sparse. King.com filed using a provision in the 2012 JOBS act that allows companies with less than $1 billion in revenue to delay revealing financial data at the beginning of the process.
King.com has been developing casual and social games since 2003. Candy Crush Saga, the company's most popular game, was released for Facebook ( FB- Free Report ) and for smart phones in late 2012. In March 2013, it became the most popular game on Facebook with more than 46 million monthly users.
Since its launch, the game has been one of the most popular and profitable apps in the iOS App Store. While the game itself is free, like Zynga ( ZNGA- Free Report ) and Electronic Arts ( EA- Free Report ) , King.com's games generate revenue by giving players the option of making in-app purchases. It is estimated that Candy Crush Saga generates $633,000 per day from in-app purchases.
There has been some controversy around established companies like Twitter and King.com using the so-called "secret filling" provision of the JOBS act. The rule was designed to allows emerging businesses that file to avoid speculation if there are delays or revisions to an application. It is believed that Twitter is leveraging this provision to avoid the sort of hype that Facebook faced prior to its IPO.
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