Boeing, Cameco, StanCorp Financial Group, Genworth Financial and Primerica highlighted as Zacks Bull and Bear of the Day
CHICAGO, July 22, 2013 /PRNewswire/ -- Zacks Equity Research highlights Boeing (NYSE: BA-Free Report) as the Bull of the Day and Cameco (NYSE: CCJ-Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis ontheStanCorp Financial Group Inc. (NYSE: SFG-Free Report), Genworth Financial Inc. (NYSE: GNW-Free Report) and Primerica, Inc. (NYSE: PRI-Free Report).
Here is a synopsis of all five stocks:
Boeing (NYSE: BA-Free Report) has been in the news a lot lately, and for all the wrong reasons. The company has seen several issues with its high-tech 787 Dreamliner aircraft which many believe is the future for the company.
These concerns have led to brief sell-offs for BA, pushing shares sharply lower in some sessions and causing many investors to think twice about investing in the company. However, the company has powered through this weakness and is back at all-time highs, suggesting that these recent problems shouldn't be much of a concern to investors.
After all, many analysts remain extremely bullish on Boeing and their prospects for the near term. Growth is expected to be in the double digits for both this quarter and the next, while the current year and next year growth rates are also impressive, coming in at 30% and 10.8%, respectively.
This growth rate also represents some acceleration from previous years, suggesting that Boeing is on the right track. Growth for the past five years was at just 1.3%, while for the next five it is moving into double digit range at 10.3%, meaning that this large cap stock isn't done growing yet.
If that wasn't enough, estimates have also been surging for both the current year and next year periods, while the Earnings ESP is positive for all four periods studied. The full year consensus has actually slowly risen from $6.39/share 90 days ago to $6.51/share today, suggesting that analysts are increasingly bullish about the company's near term prospects.
Although there has been some strength in the mining sector lately, the overall trend for the space hasn't been good. The industry has been hampered by low levels of demand, concerns about emerging markets, and a strong dollar which has pushed many investors out of commodities.
While this bearish outlook has manifested itself in silver and gold miners, a number of other segments have also been hit by this trend. In particular, the miscellaneous segment—which includes firms that mine for items like uranium, rare earths, and palladium/platinum—could also face weakness ahead, such as in the case of Cameco (NYSE: CCJ-Free Report).
The Canadian-based firm is a relatively well-known name in the uranium mining space, operating several properties in the Saskatchewan province of Canada. The company also has a few locations in the U.S. Midwest, in addition to a Kazakhstani property as well.
Beyond their mining segment, the company is also engaged in a bit of nuclear energy production. This is represented by a minority stake the company has in Bruce Power L.P. which produces power in a few Ontario reactors.
Thanks to its relatively diverse operations and the company's focus on a key product like uranium, CCJ hasn't seen that bad of a 2013 so far. In fact, the company is positive from a year-to-date look, adding about 5% in the time frame, though it has experienced extreme volatility too.
While this definitely represents a bit of outperformance when compared to others in the space, investors should be concerned that this will not last in the months ahead. This is particularly true when investors consider the estimate revision picture, and projected growth rates for this company.
Will StanCorp Beat Earnings Estimates?
StanCorp Financial Group Inc. (NYSE: SFG-Free Report) is set to report second quarter 2013 results on Jul 23. Last quarter it posted a 33.7% surprise. Let's see how things are shaping up for this announcement.
Growth Factors This Quarter StanCorp Financial's Asset Management segment continues to perform well. The trend is expected to continue in the future. Further, we expect the company to reap the benefits of lower operating expenses that helped it to outperform in the last reported quarter.
StanCorp Financial enjoys a strong capital position, which allows it to enhance shareholder value. StanCorp Financial expects to buy back shares worth $40 million to $80 million in 2013. This will boost the bottom line. In order to return more profit, the company raises its dividend on a regularly basis.
In addition, StanCorp Financial's investment portfolio continues to perform well with no considerable exposure to high-risk asset classes.
However, lower Group insurance premiums due to a low single-digit price increase in the group insurance business and stiff competition weighed on new sales and renewals. The lack of employment and wage growth is also expected to weigh on the performance.
A low interest rate environment is also a concern.
Our proven model does not conclusively show that StanCorp Financial is likely to beat earnings this quarter. That is because a stock needs to have both a positive Expected Surprise Prediction or ESP (Read: Zacks Earnings ESP: A Better Method) and a Zacks Rank of #1, 2 or 3 for this to happen. That is not the case here, as you will see below.
Positive Zacks ESP: That is because the Most Accurate Estimate stands at $1.00, while the Zacks Consensus Estimate is higher at $1.01. That comes to a difference of -0.99%.
Zacks Rank #1 (Strong Buy)
: StanCorp Financial's Zacks Rank #1 (Strong Buy) increases the predictive power of ESP. However, the Zacks Rank #1 when combined with a negative ESP makes surprise prediction difficult.
Other Stocks to Consider
Here are some other companies you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:
- Genworth Financial Inc. (NYSE: GNW-Free Report), Earnings ESP of +11.11% and Zacks Rank #3 (Hold)
- Primerica, Inc. (NYSE: PRI-Free Report), Earnings ESP of +1.39% and Zacks Rank #3 (Hold)
About the Bull and Bear of the Day
Every day, the analysts at Zacks Equity Research select two stocks that are likely to outperform (Bull) or underperform (Bear) the markets over the next 3-6 months.
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