CHICAGO, Jan. 8, 2014 /PRNewswire/ -- Zacks Equity Research highlights Herbalife (NYSE:HLF-Free Report) as the Bull of the Day and NQ Mobile (NYSE:NQ-Free Report)as the Bear of the Day. In addition, Zacks Equity Research provides analysis onT-Mobile U.S. Inc. (NYSE:TMUS-Free Report), AT&T Inc. (NYSE:T-Free Report) and Verizon Communications Inc. (NYSE:VZ-Free Report).
Here is a synopsis of all five stocks:
Herbalife has topped the Zacks Consensus Estimate in each of the last 29 quarters which is a pretty unique accomplishment.
The last two beats were $0.22 and $0.27 -- but put in better perspective when you look at the percentage surprise. The June 2013 quarter came in 18.5% ahead of expectations and the September 2013 quarter was 23.7% ahead of analysts' estimates. Those are some pretty big beats.
Herbalife is a network marketing company that sells weight management, nutritional supplements, energy, sports and fitness, and personal care products worldwide. Herbalife offers its products through retail stores, sales representatives, sales officers, and independent service providers. The company was founded in 1980 and is based in Grand Cayman, the Cayman Islands.
In a late-December 2011 conference, Bill Ackman disclosed that he was short approximately 20 million shares of Herbalife. The total short interest as of the end of December was approximately 37 million shares. Ackman asserts that the company is nothing short of a pyramid scheme and will end up at $0.00. To further substantiate this claim, Ackman needs the FTC to investigate the company and despite recent rumors and Freedom of Information Acts, there has been no such investigation.
NQ Mobile (NYSE:NQ-Free Report) may have recently received a large investment from Morgan Stanely, but it is still being questioned by Muddy Waters and others. Estimates have been slashed and as a Zacks Rank #5 (Strong Sell) it is the Bear of the Day.
Muddy Water Research, an independent research group that is known for its calls for investors to short a particular stock, published a report on NQ on October 24, 2013 claiming the company "is a massive fraud."
You can access the Muddy Water report here:
NQ Mobile Inc. provides mobile Internet services in the areas of mobile security, privacy, productivity, personalized cloud, and family protection. NQ Mobile Inc. was founded in 2005 and is headquartered in Beijing, the People's Republic of China.
In a late-December 2013 Morgan Stanley disclosed a passive stake of 5.2% of the company. Institutions have to disclose via SEC form 13-G or 13-D if they own 5% or more of a company. Those filings will tend to drive smaller investors to follow them into the position. At the time of the filing, NQ was trading below $12.
By the end of that week, the stock moved higher to $15.95 and had posted a dramatic gain of 40%.
T-Mobile Opts for Verizon Spectrum
In an attempt to enhance its low-band spectrum portfolio,T-Mobile U.S. Inc. (NYSE:TMUS-Free Report) has agreed to exchange airwave license with Verizon Wireless in a deal worth $3.3 billion. The fourth largest U.S. telecom carrier has said that it could make further spectrum purchases to improve its network speed. Shareholders welcomed the news as the stock moved up 3.72% on Monday on Nasdaq.
Per the agreement, T-Mobile will purchase some low-band spectrum in the 700 MHz block for $2.365 billion in cash while transferring certain AWS and PCS airwaves worth $950 million, to Verizon Wireless. Both the companies will rearrange spectrum blocks in the northern California and Atlanta regions.
The transaction is subject to the Federal Communication Commission (FCC), Department of Justice and other related regulatory approvals. The companies expect the deal to be finalized by mid-2014.
Low-frequency spectrums are substantially more valuable as these cover more distance and travel well through walls and other obstructions. Post-transaction, T-Mobile will have low band spectrum in 9 of the top 10 and 21 of the top 30 U.S. markets covering 158 million people in cities like New York, LA, Dallas and Washington.
This again clearly proves how crucial and pricier spectrums have actually become over time. Reportedly, Verizon sold the spectrum at a much higher value than the auction price paid several years back.
T-Mobile's quest for wireless airwave does not come as a surprise as all the leading U.S. carriers are investing a lot of cash to ramp up their spectrum portfolio either through swap deals or by purchasing it from smaller counterparts to support data hungry customers.
Further, T-Mobile is lagging its larger peers like AT&T Inc. (NYSE:T-Free Report) and Verizon Communications Inc. (NYSE:VZ-Free Report) in LTE deployment as the company has so far covered 209 million people in 273 metros. We believe the spectrum will aid T-Mobile in extending its LTE network reach and tapping customers through its competitive offerings. Recently, the company announced that it will launch Uncarrier 4.0 plan, which will buy out the early termination fees of customers switching from other carriers, thus spurring rivalry among the top guns.
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