Westlake Chemical, PROS Holdings,Unilever, Lloyds Banking Group and ICON highlighted as Zacks Bull and Bear of the Day
CHICAGO, May 28, 2014 /PRNewswire/ -- Zacks Equity Research highlights Westlake Chemical Corporation (NYSE:WLK-Free Report) as the Bull of the Day and PROS Holdings (NYSE:PRO-Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis onUnilever NV (NYSE:UN-Free Report), Lloyds Banking Group plc (NYSE:LYG-Free Report) and ICON (Nasdaq:ICLR-Free Report).
Here is a synopsis of all five stocks:
Earnings estimates have risen strongly for Westlake Chemical Corporation (NYSE:WLK-Free Report) following the company's 9th consecutive positive earnings surprise on May 5. It is a Zacks Rank #1 (Strong Buy) stock.
While shares of Westlake jumped after the latest beat, the valuation picture still looks reasonable, which leaves plenty of room for further upside.
Westlake Chemical Corporation manufactures and markets basic chemicals, vinyls, polymers and fabricated building products. Its operates in two segments:
- Olefins (~69% of total sales), which are the basic building blocks used to create a wide variety of petrochemical products, and
- Vinyls (~31% of total sales), which include PVC, VCM, EDC, chlorine, caustic soda and ethylene. The company also manufactures and sells building products fabricated from PVC, including pipe, fittings, profiles and foundation building products, fence and deck, and window and door components.
Westlake Chemical reported better-than-expected first quarter results on May 5. Earnings per share came in at $1.18, beating the Zacks Consensus Estimate of $1.13. It was a 28% increase over the same quarter last year.
PROS Holdings (NYSE:PRO-Free Report) recently missed the Zacks Consensus Estimates for Q1 on both the top and bottom lines. Although management reiterated its full year revenue guidance, analysts revised their earnings estimates lower for both 2014 and 2015. This sent the stock to a Zacks Rank #5 (Strong Sell).
While shares of PROS Holdings have taken a beating like many other "high tech" stocks, valuation still looks very expensive with shares trading at 144x next year's earnings.
PROS Holdings is a "big data" software company that offers solutions to optimize sales, pricing, quoting, rebates and revenue management across more than 40 industries. Around 69% of total revenue comes from "License & Implementation" while the rest comes from "Maintenance & Support". Approximately 56% of its revenue comes from outside of the United States.
PROS Holdings reported its first quarter results on May 8. Adjusted earnings per share (which still includes share-based compensation) came in at a loss of 12 cents, which was below the Zacks Consensus Estimate calling for a loss of 9 cents.
Additional content:
3 EU Election Stock Picks
Last Thursday, elections began for the European Parliament, which represents nearly 500 million citizens. The European Union has enjoyed a period of stability for some time now, following a period of unrest. However, there were apprehensions that the outcome of these elections would create disaffection against pro-EU governments and hold up economic austerity initiatives.
Austerity and Its Discontents
Several political parties have grown in strength riding on the wave of discontent against issues seen to be emanating from the EU. This includes the series of austerity measures which several countries such as Greece have been forced to implement in return for assistance received from the currency union.
This has been accompanied by concerns regarding immigration, growing unemployment and a perceived loss of power to the EU. These factors have combined to provide strength to parties with an anti EU stance which have been labeled as euroskeptics.
EU Holds Strong
Anti EU groups have made significant gains in the elections. For instance, in the United Kingdom, an important party opposed to the EU received 28% of the votes. The right-wing National Front party, which has also opposed immigration got 25% of the French vote, compated to 6% in earlier elections.
In the end, the older pro-EU parties continued to hold the edge, garnering the majority of the seats in the European Parliament. Meanwhile, Petro Poroshenko has won the presidential elections in the Ukraine. Petroshenko is known to have a strong pro-EU stance.
Markets Gain from Results
Key indices in the regions gained from the results of elections in the European Parliament and Ukraine. France's CAC 40 gained 0.8% while Spain's IBEX moved up 1.2%. Germany's DAX gained the most, increasing 1.3%. The euro also chalked up gains, following losses against the dollar made earlier.
Some analysts are of the opinion that the gains made by anti EU parties could actually be beneficial in the long run. The number of strictures created by the EU could be detrimental for the corporate sector and also affect markets. A reduction in red tape could be a welcome change for the bourses.
Below we present three European stocks which have a track record of consistent performance. Each of them also has a good Zacks Rank.
Unilever NV
Unilever NV (NYSE:UN-Free Report) is a public limited company registered in The Netherlands with listings on stock exchanges in Amsterdam, Frankfurt, Zurich and New York (NYSE). It is a British-Dutch multinational corporation and its shares listed on the NYSE are known as New York Shares. Unilever is a leading manufacturer and marketer of consumer products in the world with significant presence across developed, developing and emerging markets.
Unilever NV holds a Zacks Rank #2 (Buy). The forward price-to-earnings ratio (P/E) for the current financial year (F1) is 19.74.
Lloyds Banking Group plc
Lloyds Banking Group plc (NYSE:LYG-Free Report) is a United Kingdom-based financial services company, whose businesses provide a range of banking and financial services in the United Kingdom and a limited number of locations overseas. Headquartered in London, the company operates through four segments: Commercial Banking, Retail Banking, Insurance and Wealth, Asset Finance and International.
Currently, the company holds a Zacks Rank #2 (Buy) and a P/E (F1) of 10.32.
ICON Public Limited Company
ICON (Nasdaq:ICLR-Free Report) is a global full service clinical research organization. The company provides contract clinical research services to the medical device, pharmaceutical and medical device industries worldwide. ICON purchased Aptiv Solutions in May 2014.
Apart from a Zacks Rank #1 (Strong Buy), ICON has a P/E (F1) of 17.27.
Despite challenges from protest parties the European Union holds strong. Election results in Ukraine have also added to optimism surrounding the Euro Zone. This is why these stocks would make good additions to your portfolio.
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