Rexnord, UTi Worldwide, Amira Nature Foods, Calavo Growers and Fresh Del Monte Produce highlighted as Zacks Bull and Bear of the Day
CHICAGO, Sept. 12, 2013 /PRNewswire/ -- Zacks Equity Research highlights Rexnord (NYSE:RXN-Free Report) as the Bull of the Day and UTi Worldwide (Nasdaq:UTIW-Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on the Amira Nature Foods Ltd. (NYSE:ANFI-Free Report), Calavo Growers Inc. (Nasdaq:CVGW-Free Report) and Fresh Del Monte Produce Inc. (NYSE:FDP-Free Report)
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Here is a synopsis of all five stocks:
Estimates have been rising for Rexnord (NYSE:RXN-Free Report) following better-than-expected first quarter 2014 results and a favorable debt refinancing.
It is a Zacks Rank #1 (Strong Buy) stock.
Despite solid earnings momentum and growth potential, shares of Rexnord trade at a discount to their peers on a forward P/E and price-to-sales basis. This could present a good buying opportunity for investors.
Rexnord Corporation is an industrial company that operates in two segments: Process & Motion Control and Water Management. The Process & Motion Control division manufactures specified, highly-engineered mechanical components used within complex systems. The Water Management division manufactures products that provide and enhance water quality, safety, flow control and conservation.
Rexnord delivered better-than-expected results for the first quarter of its fiscal 2014 on July 31. Adjusted earnings per share came in at 23 cents, beating the Zacks Consensus Estimate by 3 cents.
Net sales rose 3% to $508.7 million, ahead of the consensus of $499.0 million. This was driven by an 8% increase in the Water Management segment thanks to market share gains in the company's end-markets and increased alternative market sales in its non-residential construction end-markets.
UTi Worldwide (Nasdaq:UTIW-Free Report) recently reported its 6th consecutive earnings miss as revenues fell -5% year-over-year. Analysts have revised their estimates significantly lower after the latest miss, sending the stock to a Zacks Rank #5 (Strong Sell).
Although shares of UTi Worldwide have fallen considerably since the Q2 report, the stock still does not look like a value at 23x forward earnings. Investors should consider avoiding the stock until its earnings momentum turns around.
UTi Worldwide Inc. provides supply chain services and solutions around the globe.
UTi Worldwide reported disappointing results for the second quarter of its fiscal 2014 on September 6. Adjusted earnings per share came in at 5 cents, missing the Zacks Consensus Estimate of 14 cents. It was the company's 6th consecutive earnings miss.
Revenues declined -5% to $1.129 billion, below the consensus of $1.155 billion. Net revenues (revenues minus purchased transportation costs) also fell -5%. The decline in revenues was driven in part to ongoing competitive pressures in freight forwarding.
Following the second quarter earnings miss, analysts have been lowering their estimates for both 2014 and 2015, which has sent the stock to a Zacks Rank #5 (Strong Sell).
The Zacks Consensus Estimate for 2014 is now $0.28, down from $0.46 just 7 days ago. The 2015 consensus is currently $0.67, down from $0.80 over the same period.
Additional content:
3 Agriculture Stocks You Should Own Now
The success of the U.S. agricultural sector primarily hinges upon strong demand for agricultural exports, which have risen significantly over the years. Agricultural exports aggregated $135.8 billion in 2012 and are projected to reach $142 billion in 2013. Trade surplus in agricultural goods reached $32.4 billion in 2012.
Rising incomes, a growing middle class in emerging countries, evolving dietary patterns and demand for organic food items are increasingly making the developing countries net importers of farm products, thereby benefiting developed countries like the U.S.
Domestic consumers are also reaping the benefits from a highly efficient agricultural sector. Primarily, with their increasing real incomes, most Americans have changed their food choices to include higher value foods like better cuts of meat, variety of fruits and vegetables, and organic and specialty food items.
Organic farming is currently one of the fastest-growing sectors in agriculture, with double-digit growth in sales. Technological innovations and widespread adoption of a series of biological, chemical, mechanical and organizational advances have enabled farmers to better adjust feed mixes and climate controls to meet the needs of crops and livestock to improve total productivity.
3 Top Agricultural Picks
Amid such strong industry fundamentals, there are certain agricultural stocks with attractive valuation metrics backed by a solid Zacks Rank #1 (Strong Buy). Let's take a closer look at these companies that appear to be well positioned to benefit from the solid sector dynamics.
Amira Nature Foods Ltd. (NYSE:ANFI-Free Report): Based in Dubai, the United Arab Emirates, the company processes, distributes, and markets packaged specialty rice and value-added meals, ready-to-eat snacks, edible oils and dairy products for retailers under the Amira brand name. At the same time, the company sells maize, sugar, soybean meal, onion, potato, and millet for trading firms across the globe.
Amira has a forward P/E and long-term earnings expectation of 10.27x and 46.00%, respectively. The stock has retained the Zacks Rank #1 (Strong Buy) over a fortnight and had an earnings surprise of 110% in the last reported quarter.
Calavo Growers Inc. (Nasdaq:CVGW-Free Report): The company trades at a forward P/E of 24.73x and has a long-term earnings expectation of 13.00%. Headquartered in Santa Paula, CA, Calavo markets and distributes avocados, prepared avocados, and other perishable foods to food distributors, produce wholesalers, supermarkets, convenience stores and restaurants worldwide. The stock was upgraded to a Zacks Rank #2 (Buy) on Sep 7, before rising to its current Zacks Rank #1 (Strong Buy).
Fresh Del Monte Produce Inc. (NYSE:FDP-Free Report): Based in George Town, Cayman Islands, the company has a forward P/E of 14.19x. The company produces, markets and distributes fresh-cut fruit and vegetables worldwide in addition to the manufacturing of plastic and box products including bins, trays, bags, and boxes. The stock has retained its Zacks Rank #1 (Strong Buy) since Aug 31.
The U.S. agriculture sector had performed relatively better than other sectors in the economy during the Great Recession and its immediate aftermath. A vibrant U.S. agricultural sector is essential for the overall growth and prosperity of the nation and these high-potential stocks with strong fundamentals pledge a healthy ROI during this uncertain time.
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