CHICAGO, March 8, 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 Applied Materials Inc. (Nasdaq: AMAT), Covidien (NYSE: COV), Johnson & Johnson (NYSE: JNJ), Becton Dickinson (NYSE: BDX) and C.R. Bard (NYSE: BCR).
Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=5513
Here are highlights from Wednesday's Analyst Blog:
Applied Materials Ups Buyback, Hikes Dividend
After reporting an encouraging first quarter last month, Applied Materials Inc. (Nasdaq: AMAT), the leading producer of chip making equipment, has authorized the repurchase of shares up to an additional value of roughly $3.0 billion over the next three years. The company has less than $1.0 billion available under the existing buyback plan which was started in 2010.
Additionally, the company also announced its decision to hike quarterly dividend by one cent to 9 cents per share. This translates into a 13% increase from the prior dividend. The increased dividend will be paid on June 14, 2012, to stockholders of record on May 24, 2012. Prior to this announcement, AMAT had been paying a quarterly dividend of 8 cents per share.
We believe that continuous share buybacks and a hike in dividend will inspire investor loyalty through higher returns from the stock.
During the recently concluded first quarter, Applied Materials spent $200 million on share repurchases and $104 million on dividends. The cash and short-term investments balance was $2.0 billion at quarter-end, having declined $4.2 billion during the quarter due to the cash paid for the Varian acquisition during the quarter. The debt cap ratio including long-term liabilities and short-term debt was just 22.1%. We remain encouraged by Applied Materials' strong cash position and its ability to service its long-term debts.
Applied Materials reported decent first quarter results, with both revenue and earnings per share surpassing our expectations. The company provided a strong revenue outlook for the second quarter, which was up 5–15% sequentially. Applied Materials' strong position in the semiconductor market, improving business, both on account of stronger end markets and the Varian acquisition, the solar business in China, its huge portfolio and strategic relationships are all positives.
The regular share buybacks and dividend hikes are a good way of encouraging investor confidence as it returns shareholder value. The company expects to post better results in the second quarter than estimated by the analysts. The increase in dividend indicates that the company is heading toward strong future growth.
Applied Materials holds a Zacks #3 Rank, which translates into a short-term 'Hold' rating.
FDA Nod for Covidien's Solitaire
International health care products major Covidien (NYSE: COV) has won the green signal of the U.S. Food and Drud Administration ("FDA") for its Solitaire FR revascularization device designed to restore blood flow to the brain in patients with acute ischemic stroke.
The device works by mechanically removing blood clots from blocked vessels. The Ireland-based company said that the product will be available in the U.S. starting April 2012.
Stroke, a potentially fatal condition, is the fourth leading cause of death in the U.S, according to the American Heart Association. Ischemic stroke occurs when a blood vessel carrying oxygen and nutrients to the brain is clogged by a clot. The disease afflicts roughly 700,000 Americans annually.
Solitaire FR's U.S. regulatory application was based on the impressive results from the Solitaire With the Intention for Thrombectomy ("SWIFT") study, in which it was compared with the Concentric Medical Merci Retriever device, a commercially available clot remover. The Solitaire FR demonstrated, in the trial, superior ability in restoring blood flow to the brain within eight hours of stroke onset.
The Solitaire FR device is already approved outside the U.S. for the endovascular treatment of acute ischemic stroke, offering physicians with an innovative treatment technology over the existing therapy options.
Covidien is a leading global health care products company with a rich history of developing high-quality products in a cost-effective manner. It competes with Johnson & Johnson (NYSE: JNJ), Becton Dickinson (NYSE: BDX) and C.R. Bard (NYSE: BCR), among others.
Revenues from Covidien's core Medical Devices segment climbed 6% year over year to $1.98 billion in the most recent quarter, powered by double-digit growth across Vascular and Energy Devices product-lines.
The Vascular business had another strong quarter with revenues soaring 17% to $387 million, spurred by double-digit growth of venous insufficiency and neurovascular products.
Covidien remains committed to rolling out new products and technologies, focusing on emerging markets, and boosting market share in core segments through investments in sales and marketing infrastructure. However, sustained pricing/procedure volume pressure represents a headwind. We are currently Neutral on the stock, supported by a short-term Zacks #3 Rank (Hold).
Want more from Zacks Equity Research? Subscribe to the free Profit from the Pros newsletter: http://at.zacks.com/?id=5515.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today: http://at.zacks.com/?id=5517
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leon Zacks. As a PhD from MIT Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at http://at.zacks.com/?id=5518.
Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
Follow us on Twitter: http://twitter.com/zacksresearch
Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts
Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.
SOURCE Zacks Investment Research, Inc.