The Zacks Analyst Blog Highlights:Ralph Lauren, Starbucks, Procter & Gamble, AT&T and Microsoft
CHICAGO, June 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 Ralph Lauren Corp. (NYSE:RL-Free Report), Starbucks Corporation (Nasdaq:SBUX-Free Report), Procter & Gamble Company (NYSE:PG-Free Report), AT&T, Inc. (NYSE:T-Free Report) and Microsoft Corp. (Nasdaq:MSFT-Free Report).
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
Here are highlights from Thursday's Analyst Blog:
Ralph Lauren Down to Strong Sell on Weak Outlook
On Jun 11, 2014, Zacks Investment Research downgraded lifestyle products retailer, Ralph Lauren Corp. (NYSE:RL-Free Report) to a Zacks Rank #5 (Strong Sell).
Why the Downgrade?
Ralph Lauren has witnessed sharp downward estimate revisions over the last 60 days. The primary reason behind this was the company's disappointing first-quarter and fiscal 2015 guidance. Though the company's fourth-quarter fiscal 2014 results were strong, the company projects a slowdown in sales growth and a decline in margins in the first quarter as well as for fiscal 2015.
The company highlighted that the weak forward outlook was mainly due to increased investments toward enhancement of its global retail operations and infrastructure as well as higher capital allotments to amplify advertising and marketing.
Ralph Lauren expects its sales for fiscal 2015 to reflect a growth of about 6%—8% while operating margin for the year is projected to contract in the range of 75–125 basis points (bps). Effective tax rate for the year is expected to be 30%. Moreover, the company plans to spend about $400—$500 million toward capital projects in fiscal 2015.
For the first quarter of fiscal 2015, the company expects net revenue to increase 3%–5%. Operating margin is anticipated to contract in the range of 300–350 bps from the year-ago level driven by the timing of investments to support the company's strategic growth objectives. Effective tax rate is projected to be 30%.
The company's soft guidance triggered a downtrend in the Zacks Consensus Estimate, as analysts became less constructive on the stock's future performance. The Zacks Consensus Estimate fell 17.5% to $1.75 per share for first-quarter fiscal 2015, 4.9% to $8.70 per share for fiscal 2015 and 6.2% to $9.92 per share for fiscal 2016 in the past 60 days.
Starbucks, Duracell Offer Wireless Powermat Charging
Starbucks Corporation (Nasdaq:SBUX-Free Report), in partnership with Duracell Powermat, has started to roll out wireless charging systems in the domestic market, beginning with its stores in the San Francisco Bay Area. Starbucks stores in the Bay Area will have Powermat Spots on tables and counters to enable wireless charging of compatible devices.
Powermat is expected to hit Starbucks and Teavana stores across major markets in the U.S in 2015. The company will initiate pilots in Europe and Asia within a year.
Duracell Powermat is a joint venture between The Procter & Gamble Company's (NYSE:PG-Free Report) Duracell brand and Powermat Technologies. Powermat Spots are the next generation wireless charging technology created by Duracell Powermat.
Powermat Spots meets the technical standards set by the Power Matters Alliance (PMA), whose members include leading companies such as AT&T, Inc. (NYSE:T-Free Report) and Microsoft Corp. (Nasdaq:MSFT-Free Report). In fact, most of the devices in the recent future are expected to incorporate this technology. This latest technology addition at Starbucks stores is expected to be a boost to ushering next generation appliances with wireless charging technology into the mainstream.
Based in Seattle, WA, Starbucks holds a leadership position in digital, card, loyalty and mobile capabilities. The company had previously provided facilities like, Wi-Fi connectivity, in-store Starbucks Digital Network, mobile payment and digital music downloads in Starbucks stores.
The accelerating global adoption of smartphones and mobile technologies is gradually transforming and evolving the retail landscape in areas of payment, loyalty and consumer experiences. The company effectively uses social/digital media to drive customer awareness and thereby improve traffic flow.
Starbucks carries a Zacks Rank #3 (Hold).
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
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