For Immediate Release
Chicago, IL February 21, 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 Citigroup Inc. (C), Best Buy Co., Inc. (BBY), Mastercard Incorporated (MA), Capital One Financial Corp. (COF), General Electric Company (GE) and ServiceSource International, Inc. (Nasdaq:SREV).
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Here are highlights from Wednesday’s Analyst Blog:
Citi Inks Deal with Best Buy
Citigroup Inc. (C) declared that it has entered into a strategic agreement with Best Buy Co., Inc. (BBY) to issue as well as manage cards under the latter’s brand in the U.S. The deal constitutes Best Buy’s home brand of cards, which can be used only in its flagship stores, along with Mastercard Incorporated’s (MA) cards bearing Best Buy’s symbol, which can be used for all purchases.
Additionally, Citi inked a deal with Capital One Financial Corp. (COF) to acquire roughly $7 billion of Best Buy’s private label and its card loan portfolio. The aforementioned agreements are expected to be completed in the third quarter of 2013, subject to customary closing conditions. However, Citi does not expect the transactions to have a material impact on its 2013 earnings.
Citigroup's cards segment, Citi Retail Services, has returned to its earlier glory following the financial crisis in 2008. Thus, the bank turned round from its earlier intention to sale the assets. In 2011, Former Citigroup CEO Vikram Pandit moved the Citi Retail Services unit out of Citi Holdings division.
Citi Retail Services offers consumer as well as commercial credit card products, services, and retail solutions to national and regional retailers throughout North America. The business serves roughly 90 million accounts for a number of premier brands. The unit reported a $1.50 billion profit from continuing operations in 2012, compared with $1.48 billion in the prior year.
Management at Citi believes that the addition of Best Buy’s leading retail franchise and premium card portfolio to Citi Retail Services will substantially enhance its strong position in the U.S. market. Best Buy’s leadership position in consumer electronics, combined with Citi’s expertise, would further help in providing better service to the customers.
We believe that Citi’s agreement to issue Best Buy cards and acquire the loan portfolio from Capital One will result in a rise in revenues in the Citi Retail Services division.
Currently, Citi carries a Zacks Rank #3 (Hold).
GE Extends ServiceSource Partnership
GE Healthcare, an operating unit of General Electric Company (GE), recently extended its partnership with recurring revenue management firm ServiceSource International, Inc. (Nasdaq:SREV) to expand its services in Japan. The strategic move marks the expansion of the partnership in 11 countries in the Asia Pacific region to optimize GE Healthcare business through renewals with existing customers and thereby increase recurring revenues.
The healthcare industry has experienced a healthy growth in Asia over the past couple of years and is poised for further growth in the coming quarters as well. To capitalize on this huge revenue generating potential, GE Healthcare formed a partnership with ServiceSource in early 2011. ServiceSource developed a specialized sales team to complement the professional sales force of GE to augment its revenue in a broad range of medical technologies, including monitoring devices, life support systems, ultrasound, X-ray and sophisticated CT equipment.
GE Healthcare tasted reasonable success in its endeavor to permeate the healthcare industry across several Asian countries through its tie-up with ServiceSource. The company presently intends to replicate this success story in the competitive market of Japan. Going forward, ServiceSource plans to form a specialized sales team of its own to achieve incremental renewals and warranties for the ultrasound equipment installations of GE Healthcare across Japan.
General Electric is one of the largest and the most diversified technology and financial services corporations in the world. With products and services ranging from aircraft engines, power generation, water processing, and security technology to medical imaging, business and consumer financing, media content and industrial products, the company serves over 100 million customers worldwide.
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