The Zacks Analyst Blog Highlights: Ford Motor, Toyota Motor, General Motors Company, Citigroup and EMC

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Jun 13, 2011, 09:30 ET

CHICAGO, June 13, 2011 /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: Ford Motor Co. (NYSE: F), Toyota Motor Corp. (NYSE: TM), General Motors Company (NYSE: GM), Citigroup Inc. (NYSE: C) and EMC Corp. (NYSE: EMC).

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Here are highlights from Friday's Analyst Blog:

Ford Intros First Hybrid Minivan

Ford Motor Co. (NYSE: F) recently announced the introduction of a smaller, five passenger hatchback version of the C-Max Energi minivan, after canceling its plan to re-enter the minivan market in U.S. C-max Energi will only be available in hybrid versions when it rolls out next year in U.S. The venture will be Ford's first hybrid-only version, which offers fuel-efficiency to customers.

According to the company, C-max Energi scores over seven-passenger Grand C-max, which it plans to import from Europe, in terms of stronger business it offers. The market for C-max Energi hatchbacks and minivans has increased two-folds in Europe, where it sells gasoline and diesel varieties. The facility producing five-passenger C-max Energi will be built in Detroit. Ford intends to triple its production capacity for hybrid and electric cars in North America, which will produce over 100,000 cars annually by 2013.

Ford's hybrid version will compete directly with Toyota Motor Corp.'s (NYSE: TM) Toyota Prius and Chevrolet Volt built by General Motors Company (NYSE: GM). C-max Energi will operate in similar fashion with Volt, which allows its users to connect it to an electrical outlet or high-voltage charging station. It will first run solely on battery power before using any gasoline.

However, C-Max Energi beats Volt in many aspects discussed below.

Once fully charged, C-Max Energi will travel 500 miles, while Volt travels only 379 miles including 35 miles on battery alone. Volt accommodates only two passengers as its battery protrudes where the middle seat should be, in comparison to three-passenger C-Max Energi. C-max Energi will have a price lower than that of Volt, as it uses a lot of indigenous parts.

Based in Dearborn, Michigan, Ford Motor Company is an auto manufacturer and auto financial services provider in the U.S. and across the world. The company manufactures and distributes automobiles in 200 markets across 6 continents. The company operates through two operating sectors, Automotive and Financial Services. The shares of Ford Motor currently retain a Zacks #3 Rank (short-term Hold rating).

Citi Suffers Hack Attack

Citigroup Inc. (NYSE: C) has topped the headlines again and this time for a breach of security as hackers got access to hundreds of thousands of its credit card customers' information in North America.

It was during a routine checkup that Citi discovered this unauthorized access. Approximately 1% of its North American credit card customers' information –– primarily their names, account numbers and email addresses were leaked. However, Citi assured that more crucial information such as social security numbers, date of birth, card expiration dates or card security codes weren't exposed. In addition, debit card holders' information were not fiddled with.

Citi has around 21 million credit card customers in North America, according to its 2010 annual report. The customers are being contacted by the company and measures have been taken to avoid any such event in the future.

The Threat...

While social security numbers, birth dates, card expiration dates or card security codes were not exposed, customers are still susceptible to other problems. The extent of client information that has been hacked could be used to gain further financial information by illicit ways.

Companies Targeted

Citi data leakage happened at a time when the market is already tensed with some of the top companies having already reported a spate of cyber attacks. The most notable was that of the recent security breach at EMC Corp.'s (NYSE: EMC) RSA unit, which makes SecurID used by banks for corporate networks' to secure log in.

Such a situation raises concern about the level of protection these companies are providing to their customers. Particularly for a bank, such a breach exposes its clients to huge risk. Thankfully, the regulators are watchful and banks have been asked to enhance their security standards for safeguarding customers' information.

Our Take

The increased use of technology in the banking system has undoubtedly made the online banking access platform easier and comfortable for customers. But this has also made the system alluring for the hackers. If proper procedures to prevent such breach of security are not implemented, customers would obviously be exposed to substantial risk.

Such incidents dent Citi's reputation and might even lead to loss of customers to its competitors who could now take advantage of this faulty system at the company. Citi will also have to incur upfront costs for providing the alternative services to the affected clients like replacing their credit cards.

In the cutthroat market and especially in post financial crisis when companies are desperately looking to retain their brand names and opting for several ways to reduce costs, such an incident is definitely uncalled for.

However, we have our faith on Citi's impressive footprint around the globe. International business is gaining momentum and should support its earnings. Its core business, Citicorp, remains attractive and credit quality trends appear encouraging.

Citi currently retains its Zacks #3 Rank, which translates into a short-term Hold rating. Also, considering the fundamentals, we are maintaining a long-term Neutral recommendation on the stock.

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