Comfort Systems USA, Vail Resorts, Delta Air Lines, AMR and United Continental Holdings highlighted as Zacks Bull and Bear of the Day
CHICAGO, June 26, 2013 /PRNewswire/ -- Zacks Equity Research highlights Comfort Systems USA (NYSE: FIX-Free Report) as the Bull of the Day and Vail Resorts Inc. (NYSE: MTN-Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis ontheDelta Air Lines (NYSE: DAL-Free Report), AMR Corp. (OTC:AAMRQ-Free Report) and United Continental Holdings (NYSE: UAL-Free Report).
Here is a synopsis of all five stocks:
It seems like extreme weather conditions are more and more prevalent. Some call it global warming /climate change or perhaps it's simply a growing population that is more plugged in than ever and reporting everything they see.
While global climate change in debatable, population growth and urban sprawl is not.
The increasing population and global distribution of wealth through increased trade and e-commerce is helping to fuel both the residential and commercial housing markets as well as construction and expansion of industrial and commercial structures of all times, not to mention the companies that maintain those buildings.
Today's Bull of the Day is a unique stock that is a derivative play on the housing / economic recovery and the need for more creature comforts in the home and workplace (or at the very least basic heating and air conditioning).
Comfort Systems USA (NYSE: FIX-Free Report)is more than your local HVAC Company; they are a nationally integrated heating, ventilation and cooling (HVAC) business that offers solutions for homeowners as well as commercial applications. In fact, residential income is just a small part of their commerce.
Comfort Systems estimates that there are over 35,000 different companies that make up the highly fragmented HVAC field here in the U.S.. Their goal is to consolidate and economize this space and offer complete, quality solutions for consumers and local governments.
Selecting the Bear of the Day is an extremely difficult process. There are multitudes of great American companies out there and the last thing I want to do is seem like I'm putting one down.
The truth of the matter is that just because a stock makes the "Bear of the Day List" doesn't mean that it's a poor company or can't appreciate in value. More appropriately, they are stocks that are either struggling now or stocks that we believe may struggle in the near future.
Today's Bear is Vail Resorts Inc. (NYSE: MTN-Free Report). While it might make sense that a company with a popular, high dollar ski destination in the name is a bearish stock in the middle of the summer, you must keep in mind that Vail operates facilities year round and seasonal variations are somewhat built into the share price.
If you're not familiar with the company, they own and/or operate land, real estate and high end resorts globally.
Aside from the most profitable part of their business being weather dependent, you have the seasonal effects as well as aging demographics of their key clientele as well as minimal growth in the industry.
There is also increasing competition being pushed on consumers by the likes of Groupon, Living Social, Travelzoo and more.
Delta Closes Virgin Buyout
Following the approvals from the U.S. Department of Justice and European Commission last week, Delta Air Lines (NYSE: DAL-Free Report) completed the acquisition of a 49% stake in British carrier Virgin Atlantic from Singapore Airlines. The remaining 51% stake is retained by Richard Branson's Virgin Group.
Delta and Virgin Atlantic agreed on a code-sharing deal across 108 routes connecting 66 destinations across North America and the UK from Jul 3. Virgin Atlantic will put up its code on 91 Delta itineraries that cover both trans-Atlantic and domestic U.S. networks. On the other hand, Delta will have its code on 17 Virgin Atlantic routes, including the ones connecting London to Manchester, Edinburgh and Aberdeen.
Following this agreement, customers of both Delta and Virgin Atlantic will enjoy each other's expanded network as well as earn and redeem points for loyalty programs on each carrier.
However, the airlines are yet to receive the antitrust immunity permit of the U.S Department of Transportation for the proposed joint venture to operate nonstop flights between the U.S. and the UK. With the final consent expected to come in the third quarter of 2013, the Delta- Virgin Atlantic joint venture will be completed in early 2014.
In December last year, Delta confirmed its plans to buy the stake in Virgin Atlantic and gain substantial control over the New York to London network – one of the busiest air itineraries across the globe.
This partnership will entitle Delta and Virgin Atlantic to gain 36% access to the New York-London travel route, second to the 51% control exercised by a partnership of AMR Corp.'s (OTC:AAMRQ-Free Report) American Airlines and British Airways. United Continental Holdings (NYSE: UAL-Free Report) will have the third position with 13% of the market share.
Delta management stated that all jets flying between the U.S. and London-Heathrow will offer fully flat-bed seating arrangement, extra legroom and more reclining standard seats. There will be additional facilities like on-board on demand audio and video entertainment options. The airline aims to launch in-flight Wi-Fi connectivity on international flights next year.
We believe that Delta-Virgin Atlantic alliance will render additional frequent quality travel options for the trans-Atlantic flyers. The amalgamation of Virgin Atlantic's hefty slots at the Heathrow airport and Delta's commanding position over the U.S. airline network are expected to work in favor of passengers with extensive travel plans.
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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