The Zacks Analyst Blog Highlights:American Eagle Outfitters, Teva Pharmaceutical Industries, Biogen, Impax Laboratories and Actavis
CHICAGO, Jan. 13, 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 American Eagle Outfitters Inc. (NYSE:AEO-Free Report), Teva Pharmaceutical Industries Ltd. (NYSE:TEVA-Free Report), Biogen (Nasdaq:BIIB-Free Report), Impax Laboratories Inc. (Nasdaq:IPXL-Free Report) and Actavis plc (NYSE:ACT-Free Report).
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Here are highlights from Friday's Analyst Blog:
Dismal Holiday Sales for American Eagle
American Eagle Outfitters Inc. (NYSE:AEO-Free Report) reported disappointing net sales and comparable store sales (comps) results for the nine weeks ending Jan 4, 2014.
This Pittsburgh, Pennsylvania based company delivered total sales of $882 million, down 2% from $904 million recorded last year. Comps also slipped 7% compared to a 5% year-over-year rise.
Though the company saw an impressive Thanksgiving weekend, sales and traffic remained soft during Christmas owing to stiff competition from other retailers with better promotional offers. However, the company regained momentum following Christmas. Further, it envisions inventories to be at the desired level at the end of the current fiscal year.
Given the trend so far, this Zacks Rank #5 (Strong Sell) stock now expects its fourth-quarter fiscal 2013 earnings to dovetail with the lower-end of previously provided guidance range of 26 cents to 30 cents a share. The current Zacks Consensus Estimate for the fourth quarter is pegged at 29 cents a share, and we could witness a downtrend in the estimate in the coming days.
This retailer of apparel and accessories is scheduled to announce its fourth-quarter fiscal 2013 results on Mar 11.
American Eagle, which operates over 1,000 stores globally, is not the only company to have cut its forecast due to lower-than-expected sales and margin pressure following intense price competition that resulted in huge discounts.
New CEO for Teva
About a couple of months after the departure of its President and Chief Executive Officer (CEO), Dr. Jeremy Levin, Teva Pharmaceutical Industries Ltd. (NYSE:TEVA-Free Report) announced the selection of Erez Vigodman as the new President and CEO.
Vigodman will take over the helm from acting President and CEO Eyal Desheh on Feb 11. Desheh will resume his previous duties as Group EVP and Chief Financial Officer.
Vigodman has been on Teva's board since 2009 and his understanding of the company should prove beneficial. Although he does not come from a pharma background like his predecessor Dr. Levin, he has a track record where transforming global and complex operations is concerned. He is known for his strategic planning and has been successful in turning around the performance of companies.
At present, Vigodman is the President and CEO of Makhteshim Agan Industries (MAI), a generic agrochemical company. Vigodman is credited with returning MAI to profitability by bringing about improvements in day-to-day operations and investing in areas that would boost organic growth.
Vigodman has his work cut out for him at Teva. Teva is going through a challenging period - headwinds include EU pricing pressure, potential new competition for branded products and fewer generic product launches compared to 2012. A major challenge for the company will be for Teva to replace Copaxone (multiple sclerosis) revenues once generics enter the market.
With the U.S. Federal Court of Appeals delivering unfavorable rulings regarding the validity of certain Copaxone patents, generic competition could materialize in May 2014, much sooner than expected. Additional competition has entered the multiple sclerosis market in the form of Biogen's (Nasdaq:BIIB-Free Report) Tecfidera which is off to a strong start.
We expect the new CEO to focus on cost reduction and streamlining of operations. Teva currently carries a Zacks Rank #5 (Strong Sell). Other better-ranked stocks include Impax Laboratories Inc. (Nasdaq:IPXL-Free Report) and Actavis plc (NYSE:ACT-Free Report). While Impax is a Zacks Rank #1 (Strong Buy) stock, Actavis is a Zacks Rank #2 (Buy) stock.
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