PAREXEL International, Darden Restaurants, Baker Hughes, Helmerich & Payne and Patterson-UTI Energy highlighted as Zacks Bull and Bear of the Day
CHICAGO, July 10, 2014 /PRNewswire/ -- Zacks Equity Research highlights PAREXEL International Corporation (Nasdaq:PRXL-Free Report) as the Bull of the Day and Darden Restaurants, Inc. (NYSE:DRI-Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis onBaker Hughes Inc. (NYSE:BHI-Free Report), Helmerich & Payne, Inc. (NYSE:HP-Free Report) and Patterson-UTI Energy Inc. (Nasdaq:PTEN-Free Report).
Here is a synopsis of all five stocks:
Estimates continue to rise for PAREXEL International Corporation (Nasdaq:PRXL-Free Report). The company delivered a solid "beat and raise" quarter back in April, prompting a flurry of positive estimate revisions from analysts. Then in late June, management provided bullish guidance for fiscal 2015, and analysts once again upped their estimates.
PAREXEL is a Zacks Rank #1 (Strong Buy) stock.
PAREXEL International Corporation provides knowledge-based contract research, primarily to pharmaceutical and biotechnology clients. The company operates in three segments:
- Clinical Research Services (75% of revenue),
- PAREXEL Consulting (11%), and
- PAREXEL Informatics (14%).
PAREXEL reported better-than-expected results for its fiscal 2014 third quarter on April 29. Adjusted earnings per share came in at 56 cents, beating the Zacks Consensus Estimate of 53 cents. It was a 12% increase over the same quarter last year.
Total service revenue increased 8% year-over-year to $492.375 million, in-line with the consensus. This was driven by 9% top-line growth in both the CRS and PI segments.
Profit margins expanded too. Gross profit expanded from 31.4% to 34.4% of revenue. And the operating margin expanded from 8.1% to 10.6%. This led to a stellar 42.5% increase in operating profit.
Earnings estimates have fallen sharply for Darden Restaurants, Inc. (NYSE:DRI-Free Report) following its fiscal 2014 Q4 results in June. While some of this negative earnings momentum is due to the sale of the company's Red Lobster brand, analysts have also been disappointed with continued weak results at its Olive Garden brand.
Darden Restaurants is a Zacks Rank #5 (Strong Sell) stock.
While shares of Darden are trading near their 52-week lows, the stock does not look cheap at 20x forward earnings. Investors should consider avoiding the stock until a visible turnaround is set in place.
Darden Restaurants owns and operates more than 1,500 restaurants under the brands Olive Garden, LongHorn Steakhouse, Bahama Breeze, Seasons 52, The Capital Grille, Eddie V's and Yard House.
The company sold its Red Lobster chain to a private equity group in May. Red Lobster accounted for approximately 28% of total sales in fiscal 2014. The company plans to use the net cash proceeds of $1.6 billion to pay down debt and buy back stock.
Darden reported disappointing fiscal 2014 Q4 results on June 20. Adjusted earnings per share came in at 55 cents, which was well below the $1.01 earned in the same quarter last year.
Total sales inched up 1% year-over-year to $2.32 billion, but same-store sales fell -3.3%, including a -5.6% drop at Red Lobster. Excluding discontinued operations (i.e., Red Lobster), sales rose 3.6% to $1.650 billion.
Same-store-sales were down -3.5% at Olive Garden but increased 2.0% at its Specialty Restaurants group.
Additional content:
Worldwide June Rig Count Soars
In its monthly release, oilfield services provider, Baker Hughes Inc.'s (NYSE:BHI-Free Report) worldwide Rotary Rig Count for Jun 2014 was 3,437, up 66 from 3,371 counted in May 2014, and up 160 from 3,277 counted in June 2013.
The Baker Hughes Rotary Rig Counts gives the number of drilling rigs actively exploring for or developing oil or natural gas in the U.S., Canada and international markets. The Baker Hughes' rotary rig counts, issued since 1944, acts as an important yardstick for drilling contractors like Helmerich & Payne, Inc. (NYSE:HP-Free Report) and Patterson-UTI Energy Inc. (Nasdaq:PTEN-Free Report) in gauging the overall business environment of the oil and gas industry. Baker Hughes initiated the monthly international rig count in 1975.
Analysis of Monthly Data
International: Rigs engaged in exploration and production globally totaled 1,336 in Jun 2014. This was down 14 from 1,350 counted in May 2014, and up 3 from 1,333 counted in Jun 2013. The international offshore rig count for Jun 2014 was 314, down 12 from 326 counted in May 2014, and 23 from 337 counted in Jun 2013.
North America: North American rigs engaged in exploration and production totaled 2,101 in Jun 2014. This was up 80 from 2,021 counted in May 2014, and 157 from 1,944 counted in Jun 2013. Rigs engaged in land operations rose by 80 to 2,041 from 1,961 in May 2014 and by 153 from 1,888 in Jun 2013. The North American offshore rig count for Jun 2014 was 60 flat with May 2014 and up 4 from 56 counted in Jun 2013.
The average U.S. rig count for Jun 2014 was 1,861, up 2 from 1,859 counted in May 2014, and up 100 from 1,761 counted in Jun 2013. The average Canadian rig count for Jun 2014 was 240, up 78 from 162 counted in May 2014, and up 57 from 183 counted in Jun 2013.
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