The Zacks Analyst Blog Highlights:Stratasys, Microsoft, 3D Systems, Alps Electric and Bed Bath & Beyond

Jan 02, 2014, 09:30 ET from Zacks Investment Research, Inc.

CHICAGO, Jan. 2, 2014 /PRNewswire/ -- 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 Stratasys Inc. (Nasdaq:SSYS-Free Report), Microsoft (Nasdaq:MSFT-Free Report), 3D Systems Corp. (NYSE: DDD-Free Report), Alps Electric Co. Ltd. (OTC:APELY-Free Report) and Bed Bath & Beyond Inc. (Nasdaq:BBBY-Free Report).


Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

Here are highlights from Tuesday's Analyst Blog:

Stratasys Upgraded to Outperform

On Dec 27, 2013, we upgraded our recommendation on Stratasys Inc. (Nasdaq:SSYS-Free Report) to Outperform from Neutral, based on its favorable prospects and long-term outlook. The company reported encouraging third-quarter results on the back of solid performances from its Product and Services segments.

Currently, the stock sports a Zacks Rank #1 (Strong Buy).

Why the Upgrade?

Stratasys has delivered positive earnings surprise in two of the last four quarters, with an average beat of 284.3%. Also, Stratasys delivered robust revenues in third-quarter fiscal 2013 buoyed by solid performances by its Product and Services segments. Reported revenues also surpassed the Zacks Consensus Estimate.

Additionally, management provided an encouraging outlook for fiscal 2013. Revenues are expected to range between $470 million and $490 million, up from the previous guidance of $455.0 million to $480.0 million. Stratasys' earnings are anticipated in the range of $1.75 to $1.90 per share, significantly higher than the Zacks Consensus Estimate of $1.43 per share.

Stratasys' product launches and global expansion will help it to generate incremental sales in the long run by increasing its installed base. Moreover, the MakerBot acquisition is expected to aid its 3D systems business growth and generate higher recurring revenues, going forward.

With the assimilation of Stratasys' 3D printing application programming interface into Microsoft's (Nasdaq:MSFT-Free Report) Windows 8.1, its adoption rate is likely to increase. However, the company is concerned about its high-cost business model and competition from big and small players like 3D Systems Corp. (NYSE: DDD-Free Report).

Nonetheless, the company witnessed positive estimate revisions for the current quarter. Out of the three estimates, one was revised upwards over the past 60 days. This led to a significant increase of 39 cents in the Zacks Consensus Estimate for the current quarter, which now stands at 41 cents. In addition, for the full year, the Zacks Consensus Estimate jumped significantly to $1.43.

Investors may also consider another stock, Alps Electric Co. Ltd. (OTC:APELY-Free Report), carrying a Zacks Rank #1 (Strong Buy).

Bed, Bath & Beyond at 52-Week High: Promising?

Shares of Bed Bath & Beyond Inc. (Nasdaq:BBBY-Free Report) reached a new 52-week high of $80.26 yesterday and eventually closed trade at $80.13. The average volume of shares traded over the last 3 months was over 1,285K. Notably, this leading fashion apparel, cosmetics and home furnishings retailer amassed a year-to-date return of 42.7%.

Moreover, this home goods retailer currently trades at a forward P/E of 15.9x, a 4.6% discount to the peer group average of 16.66x. The last traded price is approximately 5.5% lower than the Zacks Consensus average analyst price target of $84.77.

We believe that the company's price appreciation is attributable to Moodys'recent announcement of a positive outlook for the U.S. consumer durable industry. Moody's declared that consumer durable companies would witness a 5%–6% rise in operating profit in the next 12–18 months owing to recovery in the U.S. economy, signs of stability in the housing market and increased spending by consumers.

Apart from this, given Bed Bath & Beyond's earnings streak and an upbeat full-year 2013 earnings outlook, the stock could be considered for investment.

The company's strategic endeavors are paying off well, as reflected in its second-quarter fiscal 2013 earnings that rose 18.4% to $1.16 per share, benefiting from the performances of World Market (Cost Plus Inc.) and Linen Holdings – which were acquired last year. Moreover, the reported figure beat the Zacks Consensus Estimate by a penny. With regard to earnings surprise, Bed Bath & Beyond has surpassed the Zacks Consensus Estimate in the trailing 4 quarters by an average of 0.3%.

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

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