U.S. Markets closed

The Zacks Analyst Blog Highlights: Qualcomm, Apple, Google, Microsoft and Elizabeth Arden

Zacks Equity Research

For Immediate Release

Chicago, IL – August 15, 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 Qualcomm Inc. (QCOM-Free Report), Apple Inc. (AAPL-Free Report), Google Inc. (GOOG-Free Report), Microsoft Corp. (MSFT-Free Report) and Elizabeth Arden, Inc. (RDEN-Free Report).

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

Here are highlights from Wednesday’s Analyst Blog:

Qualcomm Remains Neutral

We reiterate our long-term Neutral recommendation on Qualcomm Inc. (QCOM-Free Report). The company reported strong financial results for the third quarter of fiscal 2013, beating the Zacks Consensus Estimate. Qualcomm currently has a Zacks Rank #3 (Hold).

Why Kept at Neutral?

We believe that Qualcomm will continue to perform well due to a significant surge in the demand for smartphones and tablets. Management has raised its outlook for fiscal 2013 and is quite confident that it will be able to retain its current rate of revenue and earnings growth, going forward.

We believe that the long-term fundamentals of the company remain intriguing given the increasing demand for LTE-enabled mobile handsets in the developed countries, rapid transition from 2G to 3G and 4G in China and India and increasing licensing revenues. Qualcomm has a very healthy cash position, helping it to undertake several R&D activities for the next-generation products.

Qualcomm is a major chipset supplier to Samsung, which is currently the largest seller of smartphones globally and a major chipset supplier to Apple Inc. (AAPL-Free Report) for its popular iPhones. Google Inc. (GOOG-Free Report) has decided to use Snapdragon processor for its latest Nexus 7 tablets. Qualcomm has been favored by the Windows 8 operating system of Microsoft Corp. (MSFT-Free Report).

During the third quarter of fiscal 2013, Qualcomm shipped 172 million MSM chipsets, up 22% year over year. This figure was far better than the company’s guidance of a mid-point of 168 million. Average selling price of mobile handsets with an in-build Qualcomm chipset during this quarter was around $227-$233. This sequential increase registered a substantial hike of $13 from the last quarter’s mid-point.

Nevertheless, the ongoing global economic volatility may severely impact the telecommunications industry, which in turn may negatively affect the demand for Qualcomm developed chipsets. Qualcomm’s future growth depends on the continuous deployment of CDMA/OFDMA-based network technologies.

If the emerging markets fail to maintain the current rate of installing high-speed 3G, next-generation 4G or any hybrid 3G-4G wireless networks, the demand for smartphones will decline, which will affect Qualcomm’s financials.

Elizabeth Arden Downgraded to Strong Sell

Zacks Investment Research downgraded Elizabeth Arden, Inc. (RDEN-Free Report) to a Zacks Rank #5 (Strong Sell) on Aug 13, following dismal fourth-quarter and fiscal 2013 results announced last week.

Why the Downgrade?

Elizabeth Arden has witnessed sharp downward estimate revisions after reporting lower-than-expected fourth quarter and fiscal 2013 results. Shares of this makeup and skin care company crashed after the announcement and given its weak outlook for the upcoming fiscal year it has more downside left.

On Aug 8, Elizabeth Arden reported fiscal fourth-quarter earnings per share of 10 cents, missing the Zacks Consensus Estimate by 68.8% and the year-ago earnings by 64.3% due to lower revenues and poor margins. Revenues rose only 0.8% to $267.9 million and missed the Zacks Consensus Estimate of $289 million.

The fiscal 2013 earnings and revenues also missed the Zacks Consensus Estimates and fell short of the company’s expectations. The company’s growth expectations for the Elizabeth Arden brand – one of the most widely recognized beauty brands in the world – proved to be too optimistic leading the company to perform below expectations in the year. Additionally, lower-than-expected orders from one of the largest North American mass retail customers and a weak performance in Europe, especially in the U.K., pulled down revenues in both fourth quarter and fiscal 2013.

In addition, Elizabeth Arden issued a relatively weak outlook for fiscal 2014. For full year 2014, sales are expected to grow between 3.0% and 5.0% year over year, much lower than the growth seen in fiscal 2013. Earnings are expected in the range of $2.15 to $2.30, representing approximately 4% growth at the mid-point.

The Zacks Consensus Estimate for 2014 decreased a sharp 22.1% to $2.19 per share over the last 7 days as all the estimates were revised downwards. Estimates for fiscal 2015 went down 23.6% over the same timeframe.

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.

Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today.

About Zacks

Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978. The later formation of the Zacks Rank, a proprietary stock picking system; continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros.  In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros.

Get the full Report on QCOM - FREE

Get the full Report on AAPL - FREE

Get the full Report on GOOG - FREE

Get the full Report on MSFT - FREE

Get the full Report on RDEN - FREE

Follow us on Twitter: https://twitter.com/zacksresearch

Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts

Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.

Media Contact
Zacks Investment Research

800-767-3771 ext. 9339

support@zacks.com

http://www.zacks.com

Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.

Read the analyst report on QCOM

Read the analyst report on AAPL

Read the analyst report on GOOG

Read the analyst report on MSFT

Read the analyst report on RDEN

Zacks Investment Research



More From Zacks.com