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The Zacks Analyst Blog Highlights: General Electric, DSW, Citi Trends, Men's Wearhouse and Foot Locker

Zacks Equity Research

For Immediate Release
Chicago, IL – July 02, 2014 – 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 the General Electric Company (GE-Free Report), DSW Inc. (DSW-Free Report), Citi Trends, Inc. (CTRN-Free Report), Men's Wearhouse, Inc. (MW-Free Report) and Foot Locker, Inc. (FL-Free Report).
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

Here are highlights from Tuesday’s Analyst Blog:

GE Negotiating Sale of Wind Turbines

According to a Bloomberg report, diversified industrial conglomerate General Electric Company (GE-Free Report) is anticipated to shortly announce the closure of the sale of wind turbines worth approximately $604 million to Casa dos Ventos, a privately held Brazilian wind power producer.

The purchase from General Electric is a result of the failure of Wobben Wind Power, a subsidiary of Enercon GmbH, to fulfil its contractual obligation to supply 230MW of turbines worth $364.4 million to Casa dos Ventos. Additionally, subject to General Electric guaranteeing the completion of the contract by 2015, Casa dos Ventos intends to acquire additional megawatts (MW) of wind energy from General Electric. The additional turbines worth $237.7 million will produce 150MW of energy.

Brazil is counting on wind energy to generate 9.5% of its installed capacity by 2022. If the deals materializes, the strategic move by General Electric will help its subsidiary in Brazil to operate at full capacity in 2015 and 2016. With the installation of 900 turbines by the end of 2014, the company is likely to capture 24% share of the Brazilian wind turbine market. Casa dos Ventos is expected to generate 600MW from wind turbines by the end of 2018.

General Electric is one of the most diversified technologies and financial service corporations in the world. Its segments include Power & Water, Oil & Gas, Energy Management, Aviation, Healthcare, Transportation, Home & Business Solutions, and GE Capital. The GE Power & Water segment produces gas, steam and aero derivative turbines; generators; combined cycle systems; and renewable energy solutions, as well as provides water treatment services and equipment.

General Electric currently has a Zacks Rank #3 (Hold).

Why Is DSW a Strong Sell?

Zacks Investment Research downgraded DSW Inc. (DSW-Free Report) to a Zacks Rank #5 (Strong Sell) on Jun 28, 2014, following the company’s dismal first-quarter fiscal 2014 performance on May 28. Since then, the shares have nosedived 34.4%.

Why the Downgrade?

DSW witnessed sharp downward estimate revisions after reporting lower-than-expected first-quarter fiscal 2014 results. The quarterly earnings of 42 cents a share fell short of the Zacks Consensus Estimate of 48 cents and slumped 16% from the year-ago period.

Owing to an intense promotional retail environment and erratic weather, the top line slipped 0.4% to $598.9 million, with comparable-store sales (comps) declining 3.7% year over year. Sales also lagged the Zacks Consensus Estimate of $636.0 million.

This branded footwear retailer envisions earnings for fiscal 2014 to lie in the band of $1.45–$1.60 per share. Additionally, the company anticipates comps to decline by a low single-digit rate while expecting adjusted sales to improve at the same rate.

The Zacks Consensus Estimates has been portraying a downtrend as analysts became less constructive on the stock’s future performance. Estimates for fiscal 2014 and 2015 dropped 20.1% and 17.1% to $1.51 and $1.80 per share, respectively.

Other Stocks to Consider

Some better-ranked retail stocks worth considering include Citi Trends, Inc. (CTRN-Free Report), The Men's Wearhouse, Inc. (MW-Free Report) and Foot Locker, Inc. (FL-Free Report). While Citi Trends carries a Zacks Rank #1 (Strong Buy), both Men's Wearhouse and Foot Locker carry a Zacks Rank #2 (Buy).

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

About Zacks Equity Research

Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

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