The Zacks Analyst Blog Highlights: Apache, ExxonMobil, BP plc, Devon Energy and The Hain Celestial Group

CHICAGO, Jan. 5, 2012 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Apache Corporation (NYSE: APA), ExxonMobil Corporation (NYSE: XOM), BP plc (NYSE: BP), Devon Energy (NYSE: DVN) and The Hain Celestial Group Inc. (Nasdaq: HAIN).

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Here are highlights from Wednesday's Analyst Blog:

Apache Closes North Sea Asset Buy

Apache Corporation (NYSE: APA) closed the acquisition of Mobil North Sea Limited assets for $1.25 billion from the U.S. oil giant ExxonMobil Corporation (NYSE: XOM). Apache executed the deal through its subsidiary Apache North Sea Limited.

The purchased assets comprise ExxonMobil's operating interests in the Beryl, Nevis, Ness, Nevis South, Skene and Buckland fields, the Beryl/Brae gas pipeline and the SAGE gas plant, as well as non-operating interests in the Maclure, Scott and Telford fields. It also includes the Benbecula exploration acreage west of the Shetland Islands.

This acquisition is expected to boost Apache's production by 54% (reflecting an increase of 19,000 barrels of oil equivalent and 58 million cubic feet of natural gas a day) and raise its proved reserves in the North Sea by 44%.

Of late, Apache has been busy acquiring properties for the expansion of its operational territories. In mid-December 2011, Apache announced plans to take over a 65% stake in Australia based Burrup Holdings Limited for an estimated amount of A$560 million or $560 million.

We believe that Apache's long-term production growth visibility improved significantly following the asset acquisition of BP plc (NYSE: BP) and the purchase of a portion of Devon Energy (NYSE: DVN) Gulf of Mexico assets. These new acreage positions complement the company's diversified asset base.

We also remain optimistic about Apache's international operations, and the commitment to build an asset base in Australia and Egypt over the last few years. Moreover, we see meaningful growth in free cash flow over the coming years, stemming from project start-ups in these countries.

However, we see limited upside potential for Apache, considering its sensitivity to gas/oil price volatility as it is subject to complex market forces. Additionally, the company is exposed to risks such as drilling disturbances, geo-political risks and project timing delays.

As such, we expect Apache to perform in line with the broader market and, therefore, maintain our Neutral recommendation for the long term. Apache currently retains a Zacks #3 Rank (short-term Hold rating).

Hain Celestial a Healthy Option

Being a leader in natural food and personal care products categories with an extensive portfolio of well-known brands, The Hain Celestial Group Inc. (Nasdaq: HAIN) offers investors one of the strongest growth profiles in the industry. The stock is poised to rise as the economy gradually revives and appetites for organic foods get bigger.

Having said that, Hain Celestial remains a healthy option for investors. Shares of the company have portrayed a strong upward trend over the past year, giving a return of 34% considering the last traded price of $36.35 on January 3, inching closer to its 52-week high of $38.47.

Supporting the view is the current valuation of the company. On a P/E basis, Hain Celestial's shares trade at 21.4x, a 51% discount to the 43.9x for the industry average. On a price-to-book basis, the shares trade at 1.8x, which is again at a 45% discount to the industry average of 3.3x.

Moreover, considering the past performance of the company, Hain Celestial has consistently beaten the Zacks Consensus Estimate over the last four quarters in the range of 3.6% to 6.1%. The average remains at 5.2%. This suggests that Hain Celestial has topped the Zacks Consensus Estimate by an average of 5.2% in the trailing four quarters.

We believe that the company remains well positioned to capitalize on the growing global demand for organic products. The U.S. alone has shown an approximately 20% jump in its consumption of organic foods.

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