Affymetrix, Advanced Emissions Solutions, Vanguard European Stock Index, T. Rowe Price European Stock and Henderson European Focus A highlighted as Zacks Bull and Bear of the Day
CHICAGO, Sept. 3, 2013 /PRNewswire/ -- Zacks Equity Research highlights Affymetrix (Nasdaq:AFFX-Free Report) as the Bull of the Day and Advanced Emissions Solutions (Nasdaq:ADES-Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis ontheVanguard European Stock Index (Nasdaq:VEURX-Free Report), T. Rowe Price European Stock (Nasdaq:PRESX-Free Report) and Henderson European Focus A (Nasdaq:HFEAX-Free Report).
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Here is a synopsis of all five stocks:
As a result unexpectedly strong second quarter, earnings estimates have been rising for Affymetrix (Nasdaq:AFFX-Free Report), sending the stock to Zacks Rank #1 (Strong Buy) and an 'Outperform' recommendation.
Headquartered in Santa Clara, California, Affymetrix is a leading provider of microarray-based products and services to the global research community. The company utilizes its DNA chip technology in areas of gene expression, analysis, and clinical application to help treat infectious diseases, cancer, and other ailments.
Affymetrix has 1,100 employees globally and has a sales and distribution network across U.S., Latin America, Europe and Asia.
On July 31, 2013, the company reported its second quarter operating results. The quarter resulted in net income of $2.8 million or $0.04 per diluted share, compared to a net loss of $1.2 million or $0.02 per diluted share in the same quarter of 2012. The results were substantially better than the Zacks Consensus Estimate of a loss of $0.01 per share. The company reported earnings for the first time since the first quarter of 2011.
Thanks to stronger revenue and control of operating expenses, the company generated $10.3 million in cash from operations. Further they also reduced their senior-secured debt by about 25%. As a result, the company ended the quarter with $44 million cash-on-hand.
Weak results have led to sharp downward estimates revisions, sending Advanced Emissions Solutions (Nasdaq:ADES-Free Report) to a Zacks Rank # 5 (Strong Sell).
Headquartered in Colorado, ADES develops, offers, and implements proprietary environmental technologies and provides equipment and specialty chemicals that enable coal-fueled power plants to meet emissions regulations. It operates in three principal business segments: Refined Coal, Emissions Control and CO2 capture.
ADES reported its second quarter FY 2013 results on August 7, 2013. The quarter resulted in a net loss of $3.2 million or $0.32 per share compared to a net loss of $1.3 million or $0.13 per share for 2012. The results were substantially worse than the Zacks Consensus Estimate of $0.14 per share.
The Management said that while they were pleased with the continued success in Emission Control business, they were disappointed by the delays in the Refined Coal business that saw the closing of the lease contracts for two of their facilities slip into the third quarter of 2013.
Due to disappointing results and uninspiring guidance, quarterly and annual estimates have been revised sharply downwards in the past few weeks. Zacks consensus estimates for the current quarter and year are now in the negative territory—($0.11) and ($0.26) per share respectively, down substantially from $0.58 and $1.65 per share, 60 days ago.
The company has missed estimates in each of the past four quarters, with an average negative surprise of 548.72%.
Additional content:
Bet on Europe with These 3 Mutual Funds
Data released this month showed that the Eurozone has grown for the first time since the third quarter of 2011. GDP for the 17-nation economic union increased by 0.3%, according to data released this month. This marks an end to the recession plaguing the region, which had suffered a 0.3% decline even in the first quarter of 2013.
Positive GDP Data
The resurgence was led by the two largest economies of the continent, Germany and France. Germany grew by 0.7% in the second quarter, the same as the rate in the first quarter of 2012. The British economy grew at the same rate, maintaining the rate achieved in the third quarter of 2012.
France grew by 0.5%, ending the recessionary conditions prevailing in that country. Recessionary conditions have also eased for the economies of Italy and Spain, who are third and fourth in terms of size.
Specific Indicators
According to London-based financial data company Markit, the services index for the region increased from 49.8 in July to 51 in August. The manufacturing index increased from 50.3 to 51.3. The monthly composite PMI, which is an indicator for both services and manufacturing increased from 50.5 to 51.7.
Additionally, consumer confidence has also increased this month, to the highest level in more than two years. According to the European Commission, consumer confidence for the Eurozone nations increased from -17.4 to -15.6. The index has now increased successively over a period of nine months.
The Rise of Emerging Markets
Data released by index provider MSCI shows that indices in Central and Eastern Europe have risen by 1.2% in the last three months. This is especially significant, considering that emerging markets as a whole have slumped by nearly 7.5%. Excluding Russian companies, which have been hit by plummeting commodity prices, markets in these regions have gained 2.3%.
Macroeconomic indicators support these developments. Hungary's trade surplus has increased by 6 billion euros from the year-ago period. Poland's retail sales have grown by 4.3% for July, compared to the same month last year. Additionally the Czech economy has emerged from a recession, growing by 0.7% from the earlier quarter.
Mutual Fund Picks
Vanguard European Stock Index (Nasdaq:VEURX-Free Report)
Launched in June 1990, this is the largest of our choices with net assets of $11.67 billion. It also has a relatively high minimum initial investment requirement, of $3,000. This is an index fund which tracks the FTSE Developed Europe Index. The index primarily consists of stocks issued by companies from the U.K., France, Germany and Switzerland.
The mutual fund holds 508 securities in all. It is widely diversified and its top 10 holdings make only 19.47% of its assets. The fund returned 27.08% over the last one year period and has a Zacks Rank #1(Strong Buy).
T. Rowe Price European Stock (Nasdaq:PRESX-Free Report)
With net assets amounting to $885.95 million, the fund was also founded in 1990. This fund focussing on investing in European companies regardless of their size. It has a higher minimum initial requirement of $2,500.
This fund holds a total of 76 securities. Its top 10 holdings account for 20.41% of its assets. The fund returned 33.56% over the last one year period and has a Zacks Rank #1 (Strong Buy).
Henderson European Focus A (Nasdaq:HFEAX-Free Report)
The youngest of our picks, launched in August 2001, this is also relatively smaller in terms of assets. Total assets of the fund amount to $703.25 million. The fund focuses on investing in equity securities of European companies. It may concentrate it assets in a single or small number of countries and has a minimum initial requirement of $500.
The fund has a total number of 65 assets. The asset it is most invested in is European Aeronautic Defence and Space Co NV, which makes up 4.63% of its assets. The next two, Kinnevik, Investment AB and Accor SA together make up 7.50% of its assets. The fund returned 32.19% over the last one year period and has a Zacks Rank #1 (Strong Buy).
Europe seems to be on a firmer footing now on the economic front. Moreover, its emerging economies hold promise. These mutual funds will therefore make excellent additions to your portfolio.
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