The Zacks Analyst Blog Highlights: Apple, Yahoo, EI DuPont de Nemours & Co., The Dow Chemical Company and BASF SE

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Jan 25, 2012, 09:30 ET

CHICAGO, Jan. 25, 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 Apple (NASDAQ: AAPL), Yahoo! (NASDAQ: YHOO), EI DuPont de Nemours & Co. (NYSE: DD), The Dow Chemical Company (NYSE: DOW) and BASF SE (OTC: BASFY).

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Here are highlights from Tuesday's Analyst Blog:

You Are the Apple of My "i"

Apple (NASDAQ: AAPL) has a firm grip on the minds of investors... with good reason! It has been delivering great products that lead to great sales which have led to great earnings. After the close, Apple did it again.

AAPL reporting non GAAP earnings of $13.87 (Zacks consensus of $10.01) on net revenues of $46.3 billion ($38.9 billion Zacks Consensus). Looking at the numbers, it's all about the i's. iPhone sales of 37 million units is up 117% from the 17 million sold in the most recent quarter and up 128% from the 16.24 million sold in the year ago period.

iPads came in at 15.4 million unit shipments, ahead of the 11.12 million last quarter and the 7.33 million last year.

iPods sales have been slower of late but that all changed this quarter. The company sold 15.4 million iPods in the quarter, up from last quarter's 6.62 million mark but down 20% from the 19.45 million sold in the year ago period.

Macs have benefited from the tremendous sales of the above mention products for years, and the sales rate remains stable for the product line this quarter. The company sold 5.2 million Macs compared to 4.89 million last quarter and 4.13 million a year ago

Three years ago, the stock was $78 a share, and the real question is: where does it go from here?

***

Its just Apple in the tech world, though earnings also came out from Yahoo! (NASDAQ: YHOO). Recall that YHOO has just recently announced a new CEO and lost a Co-Founder from the board.

Drilling down to the three major buckets of revenue for Yahoo and we see a picture of slowing growth.

First we look at Search, and that segment reported ex-tac revenues of $375 million, flat in comparison to the previous quarter's mark of $374 and lower than the $388 it reported in the year ago period.

Display is also down from the year ago period when it posted $567 million in sales. On a sequential basis, there display was higher by 21%. This quarter display revenue was $545, ahead of the $449 million posted in the most recent quarter.

Other revenues have been fairly consistent for Yahoo!, so the report of $251 million shows little change from the previous quarters $248 million and the $250 million mark from the year ago.

The EPS beat was something that few expected for YHOO, as the CEO search probably helped employees keep their eye off the ball. At the end of the day, it's the outlook for the sale of Asian assets and what direction the new CEO will take the company.

DuPont Beats, Reaffirms Guidance

EI DuPont de Nemours & Co. (NYSE: DD) reported earnings of 35 cents per share in the fourth quarter of 2011 compared with 50 cents in the year-ago quarter. The profit exceeded the Zacks Consensus Estimate of 33 cents per share.

A higher tax rate in the quarter led to the year-over-year decline in profit. Further, higher selling prices during the quarter was offset by increased spending on selling, marketing and research and development, higher costs for raw materials, energy and freight as well as lower sales volumes.

For full-year 2011, the company reported earnings of $3.93 per share, up 20% from $3.28 per share in 2010 and exceeded the Zacks Consensus Estimate by a penny.

Sales in the quarter grew 14% to $8.4 billion due to 14% increase in prices and the agriculture segment also contributed to the increase in sales. The quarter witnessed declining sales volumes due to destocking in photovoltaics, polymer and industrial supply chains. The consumer electronics and construction division also faced soft demand.

For the fiscal year 2011, sales jumped by 20% to $38.0 billion.

Outlook

DuPont reiterated its full year 2012 earnings outlook of $4.20 to $4.40 per share, an increase of 7% to 12% compared with 2011, excluding significant items.

Our Take

Despite soft demand for consumer electronics segment and weak markets for housing and construction, DuPont delivered exceptional results for the full-year 2011. We believe that the slowdown in global economic growth could reduce the company's capital spending, thereby adversely affecting its operating performance. Further, the company faces stiff competition from The Dow Chemical Company (NYSE: DOW) and BASF SE (OTC: BASFY).

However, markets for DuPont's agriculture and food businesses continue to be strong, especially with a strong planting season in Latin America.

In view of the above stated reasons, the company retains a Zacks #3 Rank, which implies a short-term (1 to 3 months) Hold rating and we have recommended the shares of the company as Neutral for the a long-term (more than 6 months).

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