Amira Nature Foods, Avon Products, Universal Forest Products, Bluelinx Holdings and Boise Cascade highlighted as Zacks Bull and Bear of the Day
CHICAGO, Oct. 24, 2014 /PRNewswire/ -- Zacks Equity Research highlights Amira Nature Foods (NYSE:ANFI-Free Report) as the Bull of the Day and Avon Products (NYSE:AVP-Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis onUniversal Forest Products Inc. (Nasdaq:UFPI-Free Report), Bluelinx Holdings Inc. (NYSE:BXC-Free Report) and Boise Cascade Company (NYSE:BCC-Free Report).
Here is a synopsis of all five stocks:
Founded in 1915, Amira Nature Foods (NYSE:ANFI-Free Report) is a leading provider of packaged Indian specialty rice, predominantly "Basmati" rice. Rising analyst estimates sent the stock back to Zacks Rank # 1 (Strong Buy) last month.
The company has successfully evolved from a domestic Indian business to a global growth company with its strong brand and product innovation, excellent supply chain and well-established relationships with leading retailers. They are now based in Dubai and had their IPO in 2012.
The company sells its products in more than 40 countries around the world. During FY 2014, EMEA accounted for 43% of Amira's sales, while 41% of sales were in India.
Amira reported its fiscal first quarter 2015 results on August 28. Revenue for the quarter jumped about 26%, to $138.8 million. This was driven by increased volumes, price & mix, both in India and globally.
Sales in India increased by more than 30% (excluding currency impact) and international sales also increased by about 30%. Adjusted earnings increased by 24% to $0.26 per share, from $0.21 per share in the prior-year quarter, significantly ahead of the Zacks Consensus Estimate of $0.16 per share.
The management expects 20%+ revenue growth in FY 2015.
Analysts have been cutting their estimates for this door-to-door beauty products seller ahead of its Q3 earnings report due on October 30. Sliding estimates sent the stock back to Zacks Rank # 5 (Strong Sell) last week.
Avon Products (NYSE:AVP-Free Report) is global beauty company, with nearly about $10 billion in annual revenue. The company is the world's largest direct seller with more than 6 million active independent sales representatives.
Avon products which are available in over 100 countries include color cosmetics, skincare, fragrance, fashion and home products, under brand names like Avon Color, ANEW, Skin-So-Soft and Advance Techniques.
A string of disappointing results and bribery allegations have resulted in a steep decline in the stock price over the past few months. Avon was earlier featured as the "Bear of the Day" on May 6; it's down about 13% since then.
AVP reported its Q2 results on July 31. Total revenue for the quarter declined 13%, while the adjusted gross margin was down 30 basis points from the prior-year quarter. Adjusted net income was $0.20 per share, down from $0.29 per share, for same quarter a year ago and was also short of the Zacks Consensus Estimate of $0.21 per share. This was company's third miss in the last four quarters.
On October 10, Moody's downgraded the rating on unsecured notes issued by the company based on "concern that competitive and structural challenges associated with Avon's direct selling model are creating pressure on representative levels, revenue and cash flow."
Additional content:
Universal Forest Poised for Long-Term Growth
On Oct 22, 2014, we issued an updated research report on Universal Forest Products Inc. (Nasdaq:UFPI-Free Report). While the company seems well positioned to benefit from the recovering U.S. housing market, presence of near-term headwinds cannot be completely ruled out.
Universal Forest Products' Housing and Construction business will gain from product additions and expansion of distribution capacities in the Manufactured Housing business, apart from favorable national housing starts in the Residential Construction business and expansion in the Commercial Construction and Concrete Forming business.
In addition, rise in home improvement spending as well as new product initiatives will boost Universal Forest's Retail Building Material business while additions of new customers and high orders from existing customers will drive the Industrial business.
Expecting such a favorable scenario to prevail in the years ahead, Universal Forest targets to achieve roughly $3 billion in sales and bring operating margins to normal historical levels by 2017. Revenues from new product sales are estimated to reach $250 million.
Also, Universal Forest Products' commitment to reward its shareholders through dividend payments and share buybacks works in its favor. Recently, the company increased its semi-annual dividend rate by 9% to 40 cents per share from the previous rate of 21 cents. Also, exiting the third-quarter 2014, the company had 2.9 million share buyback authorizations left.
However, Universal Forest Products remains exposed to customer concentration risks and rising costs and expenses. In the last five years (2009–2013), the company's cost of goods sold, as a percentage of revenue, has increased 320 basis points to 88.6%.
Moreover, the company faces stiff competition from a number of national and international players in the lumber and wood production industry including Bluelinx Holdings Inc. (NYSE:BXC-Free Report) and Boise Cascade Company (NYSE:BCC-Free Report).
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