WSFS Financial, Orion Marine Group, Macy's, PVH and New York & Co.highlighted as Zacks Bull and Bear of the Day
CHICAGO, Aug. 14, 2013 /PRNewswire/ -- Zacks Equity Research highlights WSFS Financial (Nasdaq:WSFS-Free Report) as the Bull of the Day and Orion Marine Group (NYSE:ORN-Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis ontheMacy's, Inc. (NYSE:M-Free Report), PVH Corp. (NYSE:PVH-Free Report) and New York & Company Inc. (NYSE:NWY-Free Report).
(Logo: http://photos.prnewswire.com/prnh/20101027/ZIRLOGO)
Here is a synopsis of all five stocks:
WSFS Financial (Nasdaq:WSFS-Free Report) delivered a big second quarter earnings beat, prompting analysts to revise their estimates significantly higher for both 2013 and 2014.
This drove the stock to a Zacks Rank #1 (Strong Buy). Although shares of WSFS have been soaring, the valuation picture still looks very reasonable, leaving the stock with plenty of room to continue running higher.
The Zacks Consensus Estimate for 2013 is now $4.27, up from $3.69 before the Q2 report. The 2014 consensus is currently $4.37, up from $3.90 over the same period. The small cap bank industry has been hot recently, due in part to solid second quarter results and a steepening yield curve. In fact, the 'Finance - Savings & Loan' industry ranks in the top 10% of all industries that Zacks ranks.
Shares of WSFS have been on a tear recently, climbing more than +20% since June 20. But the valuation picture still looks reasonable given the big increase in estimates. The stock currently trades at 14x 12-month forward earnings, in-line with its 10-year median and below the industry median of 18x. With favorable industry tailwinds, strong earnings momentum and reasonable valuation, WSFS offers investors attractive upside potential.
Estimates have been falling for Orion Marine Group (NYSE:ORN-Free Report) after the company reported an earnings miss on August 1. It is a Zacks Rank #5 (Strong Sell) stock. Despite the negative earnings momentum, shares of Orion Marine still trade at a premium valuation. Investors may want to wait for earnings momentum to turn around before establishing a long position.
Following the second quarter earnings miss, analysts revised their estimates meaningfully lower for both 2013 and 2014. This sent the stock to a Zacks Rank #5 (Strong Sell). The Zacks Consensus Estimate for 2013 is now $0.11, down from $0.14 before the Q2 release. The 2014 consensus is currently $0.29, down from $0.36 over the same period.
This is not just a company-specific phenomenon though. The 'Building - Heavy Construction' industry ranks 238th out of the 265 industries that Zacks ranks, placing it in the bottom 11% of all industries. This indicates that earnings estimates are generally falling throughout the industry.
Shares of Orion Marine are down more than -17% since the Q2 earnings release. Despite this, the stock doesn't look like a value here. Shares currently trade around 41x 12-month forward earnings, which is a premium to the industry median 14x. With falling earnings estimates and premium valuation, investors should consider avoiding this Zacks Rank #5 (Strong Sell) stock until its earnings momentum turns around.
Additional content:
Will Macy's Beat Earnings?
Macy's, Inc. (NYSE:M-Free Report) is slated to report its second-quarter fiscal 2013 results before the market opens on Aug 14, 2013. In the last quarter, it posted a positive surprise of 3.8%. Let's see how things are shaping up for this announcement.
My Macy's localization initiatives, omnichannel integration, robust online sales and effective cost management were the driving factors in the last quarter. In an attempt to increase sales, profitability and cash flow, the company has been taking steps such as integration of operations, consolidation of divisions, customer-centric localization initiatives, as well as developing e-Commerce business and online order fulfillment centers. Moreover, Macy's continues to focus on price optimization, inventory management and merchandise planning to drive traffic.
Our proven model does not conclusively show that Macy's is likely to beat earnings this quarter. This is because a stock needs to have both a positive Earnings ESP (Read: Zacks Earnings ESP: A Better Method) and a Zacks Rank #1, #2 or #3 for this to happen. This is not the case here, as you will see below.
Negative Zacks ESP: ESP for Macy's is -1.28%. This is because the Most Accurate Estimate stands at 77 cents, while the Zacks Consensus Estimate is pegged at 78 cents.
Zacks Rank #4 (Sell): Macy's Zacks Rank #4 (Sell) lowers the predictive power of ESP. The Zacks Rank #4 when combined with negative ESP makes surprise prediction difficult. We caution against stocks with Zacks Ranks #4 and #5 (Sell rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.
Here are some other companies you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:
PVH Corp. (NYSE:PVH-Free Report), Earnings ESP of +2.19% and a Zacks Rank #2 (Buy).
New York & Company Inc. (NYSE:NWY-Free Report), Earnings ESP of +33.33% and a Zacks Rank #3 (Hold).
About the Bull and Bear of the Day
Every day, the analysts at Zacks Equity Research select two stocks that are likely to outperform (Bull) or underperform (Bear) the markets over the next 3-6 months.
About the Analyst Blog
Updated throughout every trading day, the Analyst Blog provides analysis from Zacks Equity Research about the latest news and events impacting stocks and the financial markets.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous analyst coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Click here to subscribe to this free newsletter today.
About Zacks
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978. The later formation of the Zacks Rank, a proprietary stock picking system; continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros.
Get the full Report on WSFS - FREE
Get the full Report on ORN - FREE
Get the full Report on M - FREE
Get the full Report on PVH - FREE
Get the full Report on NWY - FREE
Follow us on Twitter: http://twitter.com/zacksresearch
Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
[email protected]
http://www.zacks.com
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
SOURCE Zacks Investment Research, Inc.
Share this article