The Zacks Analyst Blog Highlights: Facebook, Cisco, Amazon, Microsoft and Resolute Energy
CHICAGO, Oct. 15, 2013 /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 the Facebook (Nasdaq:FB-Free Report), Cisco (Nasdaq:CSCO-Free Report), Amazon (Nasdaq:AMZN-Free Report), Microsoft (Nasdaq:MSFT-Free Report) and Resolute Energy Corporation (NYSE:REN-Free Report).
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Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
Here are highlights from Monday's Analyst Blog:
Technology Stock Roundup
The government shutdown had some impact on technology stocks last week, but overall performance was not too bad.
Facebook Goes Even More Public
Facebook (Nasdaq:FB-Free Report) has never claimed that it respects privacy and it has now removed an additional privacy filter that allowed people to search for a person by name. CEO Mark Zuckerberg has been known to make statements about how people shouldn't be doing the things they want to keep secret, so it is apparent that privacy is the least of his concerns.
Facebook claims that since people can be traced through their posts or friend lists anyway, users shouldn't mind. It is now encouraging users to protect each individual post from the people they don't want to share with. Since this is naturally a cumbersome process, most people are likely to get careless about it over time. This is obviously the idea.
Of course Facebook has much to gain. Once everyone is compulsorily searchable, it greatly improves the effectiveness of graph search and makes the property more valuable for advertisers. The company is also rolling out custom advertising programs to further increase ROI for advertisers. Another possible future benefit is better data mining for ranking or rating restaurants, hotels and such other places that can later be provided as an additional or standalone service.
Cisco Gets Some FIRE
Cisco (Nasdaq:CSCO-Free Report) has now completed its acquisition of Sourcefire, a leading provider of intelligent cyber security solutions, most of which are based on Snort, an open-source intrusion detection system. The company paid $76 in cash for each share of Sourcefire and also assumed $2.7 billion worth outstanding equity awards.
The acquisition was highly strategic for Cisco, which had been losing share to Sourcefire in recent times. Therefore, the acquisition enabled it to pick up key technology and at the same time eliminate an important competitor.
Security is expected to play a key role in Cisco's future product strategy, as networks become more intelligent and virtualization goes mainstream. Additionally, the company is on track to become a major player in the "Internet of Everything" where security integration could be an important differentiating factor.
Microsoft Takes on Amazon
Gartner estimates that Amazon's (Nasdaq:AMZN-Free Report) public cloud services business is at least five times the size of its closest competitors, as the company was able to capitalize on its first-mover advantage and rock-bottom prices. Microsoft (Nasdaq:MSFT-Free Report) intends to make up for lost time by launching compelling services at competitive prices.
Therefore, in an attempt to take share in this fast-growing market, Microsoft will announce discounts for its Windows Azure cloud services on Nov 1. It will also discount prices and increase the flexibility of services for customers on long-term contracts, irrespective of their upfront commitment.
To build on its product portfolio, the company is launching Windows Server 2012 R2 and System Center 2012 R2, which together enable the creation of advanced data centers without boundaries by virtue of its Hyper-V virtualization, cost effective storage and built-in SDN support.
Strong Buy on Resolute Energy
On Oct 9, Zacks Investment Research upgraded Resolute Energy Corporation (NYSE:REN-Free Report) to a Zacks Rank #1 (Strong Buy).
Why the Upgrade?
The independent oil and gas company Resolute Energy Corporation has delivered positive earnings surprises in the last 2 quarters with an average beat of 66.6%. The long-term earnings growth of the company is 15% on the back of sales growth of 25.0%.
Resolute Energy registered a positive earnings surprise of 33.33% in the second quarter. The results were backed by solid production in the quarter, which reached 13,107 barrels of oil equivalent (BOE) per day, 39% higher than the same quarter last year.
The company's robust capital expenditure has helped it to develop its existing generation assets. Resolute Energy invested $164.8 million in the first half of 2013 in its ongoing tertiary recovery and drilling projects in Aneth Field and drilling and completion projects in Texas, North Dakota and Wyoming.
The company also invested $257 million to acquire additional oil and gas assets in the Permian Basin in March 2013. The acquired assets contributed to the production increase in the last quarter. Reinvigorated oil and gas drilling will keep the momentum alive at the company.
The Zacks Consensus Estimate for 2013 increased 88.9% in the last 60 days to 17 cents per share, reflecting year-over-year growth of 201.96%. For 2014, the consensus increased 61.9% over the same time period to 34 cents per share, reflecting growth of 98.32%.
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