Zacks Bull and Bear of the Day Highlights: American Railcar Industries, YUM Brands, Netflix, DreamWorks Animation SKG and Amazon.com
CHICAGO, Feb. 19, 2013 /PRNewswire/ -- Zacks Equity Research highlights American Railcar Industries (Nasdaq: ARII) as the Bull of the Day and YUM Brands (NYSE: YUM) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Netflix Inc. (Nasdaq: NFLX), DreamWorks Animation SKG, Inc. (Nasdaq: DWA) and Amazon.com (Nasdaq: AMZN).
Full analysis of all these stocks is available at http://at.zacks.com/?id=2678.
Here is a synopsis of all five stocks:
With the economy coming back, many have become more optimistic on the transportation industry. This vital business segment is a key one for an economic recovery, and is generally a top performer in new bull cycles.
That is because when more good are being produced, there is a great demand for transportation firms to move them to ports and ship them around the globe. For this reason, transports are among the first to surge higher and often develop leadership roles when market sentiment shifts to positive, like what we are seeing now.
In this environment, it could be a good idea to look for top-ranked stocks in these types of industries, as they could be primed for great performances in the weeks and months ahead.
While looking at big railroad companies could be one way to approach the issue, another could be to look at manufacturing firms that build railcars, as these are often overlooked, but can been even better performers than their larger, lower beta counterparts.
One such firm that fits the bill in this respect is American Railcar Industries (Nasdaq: ARII). This company currently has a top Zacks Rank of 1 or 'Strong Buy' and could be worth considering if you are seeking a high beta play that is poised to continue surging higher.
A more robust economy has pushed many investors back into high beta stocks. Leading the way in this regard were many consumer discretionary firms, which have had a great start to 2013.
However, this trend hasn't been universal by any means, as one of the larger, and more famous companies in the space, YUM Brands (NYSE: YUM), has had an awful beginning to the year. The firm's stock has slid by nearly 5% in the year-to-date period, and it has fallen by double digits in the past three months.
This compares extremely unfavorably to both the broad market, and the consumer discretionary space as a whole by a pretty wide margin. In fact, broad markets have risen by about 10% in the time frame, suggesting a huge level of underperformance by YUM in the time frame.
YUM is best known for its three major restaurant divisions, all of which are household names at this point. KFC, Pizza Hut, and Taco Bell, all operate in the quick-service market.
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Netflix's New Series for Kids
Netflix Inc. (Nasdaq: NFLX) announced that it has collaborated with DreamWorks Animation SKG, Inc. (Nasdaq: DWA) to stream an original series, Turbo: F.A.S.T. (Fast Action Stunt Team), exclusively for kids. This original series will be available for streaming from December in the U.S. and abroad.
Turbo: F.A.S.T. is based on DreamWorks' 3D comedy film bearing the same title. In addition to the original series, Netflix will also stream new DreamWorks movies in the U.S. Moreover, the current partnership complements the earlier deal between Netflix and DreamWorks in 2011, which allowed the former to stream DreamWorks films and TV shows.
Video streaming companies have recognized that kids make up a significant chunk of TV show and film viewers. To capitalize on this, Netflix launched its exclusive Internet video streaming service for kids, 'Just For Kids' in 2011. In 2012, more than 2 billion hours of kids content was streamed for Netflix members.
Another close competitor of Netflix in the video streaming market, Amazon.com (Nasdaq: AMZN), has recently announced its plans to produce five original children shows through its film production division, Amazon Studios.
Thus, we believe that the current deal with DreamWorks Animation will help Netflix to remain competitive in the video-on-demand market. Netflix's new and exclusive content offerings to its subscribers are the company's biggest USP compared to some of its closest peers. Apart from recent movies and documentaries, Netflix is also boosting its original content portfolio to entice new subscribers in the U.S. and International markets.
However, higher costs owing to international ventures and licensing fees, and continued subscriber losses in its DVD business are near-term headwinds. Mounting losses from the international business, due to higher content and marketing costs, is another concern in the short term.
Get the full analysis of all these stocks by going to http://at.zacks.com/?id=2649.
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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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