The Zacks Analyst Blog Highlights: Facebook, Mondelez International, Google, Yahoo and Science Applications International
CHICAGO, March 10, 2014 /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), Mondelez International (Nasdaq:MDLZ-Free Report), Google (Nasdaq:GOOG-Free Report), Yahoo (Nasdaq:YHOO-Free Report) and Science Applications International Corporation (NYSE:SAIC-Free Report).
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
Here are highlights from Friday's Analyst Blog:
Facebook, Mondelez Sign Deal
The recently-signed strategic deal between Facebook (Nasdaq:FB-Free Report) and Mondelez International (Nasdaq:MDLZ-Free Report) reflects the growing importance of the social networks as advertising partners. The deal encompasses 52 countries and Facebook's enhanced reach is expected to boost Mondelez's footprint in the long run.
Per eMarketer, Facebook is set to benefit significantly from a shift in marketer spending from traditional to digital advertisement. The growth will be particularly driven by higher mobile ad spending.
In the recently concluded fourth quarter, Facebook's mobile ad revenues were $1.25 billion, which comprised 53.0% of ad revenues, up from 49.0% in the previous quarter. Advertising revenues were driven by increasing mobile engagement, higher number of marketers, continuing investment in new products and robust performance of its newsfeed ads.
We believe that Facebook has gained significant traction in its mobile ad business within a very short span of time. This combined with the massive user base and its ability to track personal details over time makes it a formidable force in the online ad market.
Initiative such as Internet.org is expected to boost Facebook's attraction for marketers, going forward. As part of the initiative, Facebook is seeking partnership with three to five wireless carriers which will roll out telecom networks and offer data services at affordable prices particularly in developing countries.
Facebook is already partnering on a regional basis (in Paraguay and Philippines). Moreover, Facebook's recently acquired short-message service provider WhatsApp has significant international presence, particularly in Asia and Europe, which will expand its footprint, going forward.
If this initiative succeeds, it will connect billions of people who will be able to access basic data services such as search and Facebook. This opens up a totally new set of Facebook users, who marketers can target, and for a consumer-oriented company such as Mondelez, this presents a huge growth opportunity.
We believe Facebook will continue to gain traction in the digital advertising market in 2014. Instagram's growing popularity and new products will help the company to face intensifying competition from the likes of Google (Nasdaq:GOOG-Free Report), Yahoo (Nasdaq:YHOO-Free Report), Snapchat, Tumblr and Pinterest, going forward.
Currently, Facebook has a Zacks Rank #2 (Buy).
SAIC Awarded Flurry of Defense Contracts
Science Applications International Corporation (NYSE:SAIC-Free Report), a leading technology integrator, recently got a boost in its dealings with the U.S. federal government through two major contracts awarded by the Space and Naval Warfare Systems Center within a span of a couple of days.
SAIC won a contract from the Space and Naval Warfare Systems Center Pacific in support of the Office of the Secretary of Defense to provide systems engineering and technical support services for Defense Readiness Reporting System (DRRS). Just two days prior to this, the company had won a task order to provide a broad range of support services for the Distributed Common Ground System – Marine Corps (DCGS-MC) Integrated Project Team.
The DRRS Contract
SAIC will compete with three other awardees for the multiple-award, cost-plus-fixed-fee contract, which has a three-year base period of performance, two one-year options and a total potential contract value of approximately $68 million for all awardees, assuming all options are exercised. Work will be performed largely in McLean, Va., San Diego, Calif. and government facilities in the Washington, D.C. metropolitan area.
DRRS provides resources to manage and report the readiness of the U.S. Department of Defense (DoD) and its subordinate components to implement the national military strategy. The system is intended to assist DoD combatant commanders, services and agencies with current and projected warfare mission capability by providing detailed readiness data from combatant and support commands.
Per the contract, SAIC will offer services and management support for the DRRS and its modules, including systems engineering, software design/development, system documentation, testing, systems integration, training, installation, life-cycle maintenance, procurement, and help-desk services. SAIC will also provide similar services for systems that interface and exchange data with DRRS.
The DCGS-MC Project
The single-award, cost-plus-fixed-fee task order was awarded under the C5ISR (Command, Control, Communications, Computers, Combat Systems, Intelligence, Surveillance, and Reconnaissance) System of Systems Engineering and Integration (SoSEI) contract vehicle, and comprised a one-year period of performance with a potential contract value of over $13 million, assuming all the options are exercised.
DCGS-MC connects intelligence, surveillance and reconnaissance (ISR) systems to the U.S. Marine Corps analysts and other military services, in order to provide the wherewithal for enterprise search, collaboration, content discovery and workflow management. Per the task order, SAIC will provide support to DCGS-MC's mission to improve system capabilities and interoperability with other services by enabling program management, production engineering, technical data package development, integrated logistics and testing. Work will be performed in Charleston, S.C.
SAIC provides technical, engineering and enterprise IT services in the U.S., with its government segment serving the U.S. federal, state and local government agencies as well as foreign governments. The company is focused on harnessing its rich domain knowledge and client relationships to facilitate the delivery of systems engineering and integration services for comprehensive government and commercial projects.
SAIC currently holds a Zacks Rank #3 (Hold).
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