Zacks Analyst Blog Highlights: Patterson-UTI Energy, BJ's Wholesale Club, Costco Wholesale Corporation, PerkinElmer and Simon Property Group

News provided by

Feb 07, 2011, 09:30 ET

CHICAGO, Feb. 7, 2011 /PRNewswire/ -- Zacks.com Analyst Blog features: Patterson-UTI Energy Inc. (Nasdaq: PTEN), BJ's Wholesale Club Inc. (NYSE: BJ), Costco Wholesale Corporation (Nasdaq: COST), PerkinElmer (NYSE: PKI) and Simon Property Group Inc. (NYSE: SPG).

(Logo: http://photos.prnewswire.com/prnh/20101027/ZIRLOGO)

Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=4579

Here are highlights from Friday's Analyst Blog:

Patterson-UTI Prospers on High Rig Count

Onshore contract driller Patterson-UTI Energy Inc. (Nasdaq: PTEN) reported notable fourth-quarter and full-year 2010 results, benefiting from strong drilling and pressure pumping activities along with an efficient rig fleet.

Earnings per share, excluding transaction-related costs and disposition expense, came in at 37 cents, ahead of the Zacks Consensus Estimate of 32 cents. The quarter's results also improved significantly from the adjusted net loss of 17 cents per share in the year-ago period.

On a similar note, for full-year 2010, the company earned 72 cents per share, beating our forecast of 67 cents. The results show a marked improvement from a loss of 25 cents per share Patterson-UTI suffered in the prior year.

Quarterly revenue of $505.7 million was up 136.8% from the year-earlier level of $213.6 million. The revenue also surpassed our projection of $476 million. Full-year revenue leaped 87.1% year over year to $1,462.9 million.

Rig Count Analysis

The number of rigs operating during the quarter averaged 182 in U.S. and 12 in Canada, netting 194, significantly up 88.3% year over year. During 2010, the company operated 168 rigs on average (159 rigs in U.S. and 8 rigs in Canada) compared with 91 rigs operational in the prior year.

BJ's Wholesale Up for Sale?

Following the recommendation given by the committee of autonomous directors, BJ's Wholesale Club Inc. (NYSE: BJ) recently announced that it is looking for strategic choices, which might include a possible sale of the company.

The leading warehouse club operator, which has been constantly falling behind Costco Wholesale Corporation (Nasdaq: COST) in terms of comparable sales growth, has hired Morgan Stanley to guide the autonomous committee during the evaluation process.

However, the company has not made any statements regarding the explicit actions regarding the sale of the company or in any other possibilities.

For the bidders, BJ's offers a striking prospect for acquisition as it has a healthy balance sheet with modest debt and offers an opening to a sturdy food and grocery market that is gaining ground.

It is not the first time that the speculation of BJ's on sale has hit the market. Earlier, a private equity player, Leonard Green, has offered to acquire the wholesale-club chain in November 2010. The buzz is that Leonard Green, which previously acquired a 9.5% stake in the company in July, would be once again interested in the acquisition. If the firm moves ahead with its plan, the acquisition of BJ's will be the latest in its string of buyouts.

Separately, BJ's also announced sales results for the four-week period ended January 29, 2011.

After registering growth of 3.8% in December 2010, BJ's experienced a comparable club sales growth of 2.7% in January 2011. For the fifty-two week period, comps climbed 4.4%. Rising gasoline prices positively impacted the comparable club sales by 2.4% and 2.0% during the four and fifty-two week periods, respectively.

PerkinElmer Beats on All Fronts

PerkinElmer (NYSE: PKI) reported fourth-quarter and fiscal 2010 adjusted (excluding one-time expenses) earnings per share of 44 cents and $1.33, beating the corresponding Zacks Consensus Estimate of 41 cents and $1.31, and surpassing the year-ago earnings per share of 37 cents and $1.07, respectively. The quarterly results surpassed the company's previously issued guidance of 40-42 cents.

Net income (as reported) climbed roughly seven-fold year over year to $288.5 million (or $2.46 a share) in the reported quarter from only $39.9 million (or $0.34 a share) in the year-ago quarter riding on roughly $246 million in income from discontinued operations and dispositions (net of tax). PerkinElmer divested its Illumination and Detection Solutions segment in the fourth quarter.

Revenues

Revenues from continuing operations came in at $470 million in the reported quarter, up 10% year over year (up 9% on an organic basis), exceeding the Zacks Consensus Estimate of $463 million. The corresponding figure for fiscal 2010 was $1,704 million, an increase of 10% (up 8% on an organic basis), also beating the Zacks Consensus Estimate of $1,713 million.

Simon Property Flourishes Overall

Simon Property Group Inc. (NYSE: SPG), a leading real estate investment trust (REIT), reported fourth quarter 2010 FFO (funds from operations) of $630.6 million or $1.78 per share, compared to $485.2 million or $1.40 in the year-earlier quarter. Fund from operations, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.

The reported quarterly FFO exceeded the Zacks Consensus Estimate by 4 cents. Excluding non-recurring items, FFO for fourth quarter 2010 was $638.7 million or $1.80 per share compared to $573.4 million or $1.66 per share in the year-ago quarter.

Total revenues during the reported quarter increased to $1.1 billion from $1.0 billion in the year-ago period. Total revenues during the reported quarter were in line with the Zacks Consensus Estimate.

For full year 2010, Simon Property reported FFO of $1.8 billion or $5.01 per share, compared to $1.7 billion or $5.33 in 2009. The reported fiscal FFO exceeded the Zacks Consensus Estimate by 5 cents. Excluding non-recurring items, FFO for fiscal 2010 was $2.1 billion or $6.03 per share compared to $2.0 billion or $6.01 per share in the previous year.

Total revenues during fiscal 2010 increased to $4.0 billion from $3.8 billion in 2009. Total revenues for full year 2010 marginally beat the Zacks Consensus Estimate of $3.9 billion.

Want more from Zacks Equity Research? Subscribe to the free Profit from the Pros newsletter: http://at.zacks.com/?id=5514.

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 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. Subscribe to this free newsletter today: http://at.zacks.com/?id=5516

About Zacks

Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leonard Zacks. As a PhD in mathematics Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which 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 at http://at.zacks.com/?id=4580.

Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.

Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts

Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.