CHICAGO, March 31, 2014 /PRNewswire/ -- Zacks Equity Research highlights Amgen (Nasdaq: AMGN-Free Report) as the Bull of the Day and McDermott International (NYSE: MDR-Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis onBank of America Corporation (NYSE: BAC-Free Report), Wells Fargo & Company (NYSE: WFC-Free Report) and McGraw Hill Financial, Inc. (NYSE: MHFI-Free Report).
Here is a synopsis of all five stocks:
Biotechnology, easily one of the best performing sectors over the past few years, has run into a bit of a roadblock lately. Some of the big names in the space have seen worries creep in about Congressional involvement in drug pricing, while there has been a general disdain for growth stocks in recent sessions too.
Despite this, many names in the biotechnology world are still looking quite promising. Drug pipelines remain robust, while earnings estimates continue to move in the right direction as well. While many companies fit this bill, one that stands out is the large cap behemoth Amgen (Nasdaq: AMGN-Free Report).
Amgen is a massive Southern California-based biotechnology company that has a market capitalization approaching $100 billion. AMGN has drugs—or is developing drugs—in a variety of areas, including oncology, inflammation, cardiovascular, nephrology, and general medicine just to name a few.
The stock has added over 80% in the past two years making it a solid performer, and one that has easily crushed the broad S&P 500 in the same time frame. However, thanks to some worries about the sector, AMGN has seen some rough trading in recent sessions, as it is pretty much flat over the past one month, underperforming the S&P 500 for the period.
Yet despite this recent bout of sluggishness, AMGN might actually be looking at some promising trends in the near term. This is particularly true if you look at recent activity on the earnings estimate revision front, as this analyst opinion has been extremely positive as of late.
Thanks to a stronger economy at home and tensions abroad, oil prices have remained firm around the $100/bbl. level lately. This trend has been reasonably bullish for companies in the drilling space, though many in the oil services market haven't risen along with their peers in the broad energy industry.
Many names in this corner of the energy world have seen rough trading over the past few weeks, despite some solid trends in the space. One name that definitely sticks out in this regard as a firm facing some headwinds is McDermott International (NYSE: MDR-Free Report).
McDermott is a Texas-based oil & gas equipment & services company that operates across the globe. The firm has a definite focus on three key regions though, Asia Pacific, Atlantic, and the Middle East, while it zeroes in on offshore oil and gas projects as its specialty.
While this might sound like an in-demand service, the stock has been in serious trouble for quite some time now, as over the past two years MDR has lost more than 40% of its value. Obviously, this is pretty terrible, but it is especially so when one compares it to the SPDR S&P Oil & Gas Equipment & Services ETF which represents the broad industry and has actually added more than 20% in the same time frame.
Will B of A Get Respite from Mortgage Suit?
A day after Bank of America Corporation (NYSE: BAC-Free Report) declared a $9.3 billion mortgage settlement deal with the Federal Housing Finance Agency (FHFA), there is something that the bank's investors can look forward to. The U.S. Magistrate Judge, David Cayer has hinted at the dismissal of a similar case due to lack of proper evidence.
The case, filed by the Department of Justice (DOJ) in Aug 2013, is related to BofA's sale of residential mortgage-backed securities (RMBS) worth $850 million. The company was accused of misrepresenting the risks and hiding information related to the underlying securitization named BOAMS 2008-A.
Further, it was alleged that more than 40% of the 1191 loans in the RMBS did not fulfill BofA's own underwriting standards. The company was also charged for not conducting proper loan-level diligence on the mortgages that were used as collateral.
Among the investors who purchased these loans, were Wachovia Bank National Association, which was later acquired by Wells Fargo & Company (NYSE: WFC-Free Report) and the Federal Home Loan Bank of San Francisco.
The case against BofA was filed under the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA). Notably, this Act demands less evidence and offers prosecutors a 10-year statute of limitations to file a case.
Following the hints of dismissal of the case, the DOJ filed court papers stating that it will be objecting to it before a district court judge. At present, U.S. District Judge, Max Cogburn will be reviewing Cayer's recommendation.
In similar cases filed under FIRREA, in Feb 2013, Standard & Poor's Ratings Services (S&P) – a unit of McGraw Hill Financial, Inc. (NYSE: MHFI-Free Report) – was sued by the DOJ for allegedly raising its credit ratings on risky RMBS before the financial crisis.
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