Zacks Bull and Bear of the Day Highlights: Private Bancorp, Pan American Silver, AVEO Pharmaceuticals, Astellas Pharma and Cleveland BioLabs
CHICAGO, May 6, 2013 /PRNewswire/ -- Zacks Equity Research highlights Private Bancorp (Nasdaq:PVTB) as the Bull of the Day and Pan American Silver (Nasdaq:PAAS) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on AVEO Pharmaceuticals Inc. (Nasdaq:AVEO), Astellas Pharma, Inc. (OTC:ALPMY) and Cleveland BioLabs Inc. (Nasdaq:CBLI).
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Full analysis of all these stocks is available at http://at.zacks.com/?id=2678.
Here is a synopsis of all five stocks:
The broad financial sector has been a strong performer so far in 2013, as it has been leading the market in the year-to-date timeframe. Furthermore, the space has actually been beating out the S&P 500 from a one year look as well, suggesting a pretty strong trend of outperformance for this key market sector.
However, we have begun to see some new trends develop in this corner of the market during the current earnings season as big banks have been having a bit of trouble. Major banking institutions have been doing quite well on earnings, but have seen sluggish revenues, suggesting that they may have a bit of trouble growing in the near future.
For this reason, it may be time to look elsewhere in the financial sector for better growth candidates, and for firms that are better poised to take advantage of current market trends. And with the domestic economy coming back a bit, investors may want to focus on regional banks like Private Bancorp (Nasdaq:PVTB)for their exposure.
While PVTB was beaten down in the financial crisis, the company is now back on track and a tremendous value. The firm has seen a solid start to 2013, as the stock is up about 18% year-to-date, while its PEG ratio is still well below the industry average at just 1.76.
Furthermore, unlike many of its peers in the space, PVTB could see a very strong performance in terms of earnings growth in the near future. Current expectations call for year-over-year growth of nearly 68% for the current quarter, and an impressive 49% growth rate for the current year.
With stock prices at record highs and some brewing optimism over the economy at large, there has been little demand for safe haven investments. This trend has been devastating for many precious metal mining companies, leading to huge losses for these firms in 2013.
Unfortunately, this trend could continue despite some worries over another summer slowdown. After all, the dollar remains quite firm against global currencies and this could remain true after the recent ECB rate cut, and Japan's impressive effort to weaken the yen as well.
These factors suggest that many precious metal mining companies should still be avoided by many investors, and especially so in the short term. And nowhere is this more the case than in the volatile silver mining world with Pan American Silver (Nasdaq:PAAS).
This important silver miner has had a horrendous start to the year losing more than 30% of its value in just the first four months of 2013. Longer term trends are even worse, if you can believe that, as PAAS has declined by over 60% in the past two years.
Yet before you start thinking this is now a deep value stock, you should consider the earnings estimate trend for the embattled company. Analysts seem to be in complete agreement on the company's lackluster future, as current year EPS growth stands at an anemic 3%.
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Negative Opinion on Astellas/AVEO Candidate
AVEO Pharmaceuticals Inc. (Nasdaq:AVEO) and partner Astellas Pharma, Inc. (OTC:ALPMY) recently received disappointing news from the US Food and Drug Administration (FDA) as its Oncologic Drugs Advisory Committee (ODAC) voted against the approval of their oncology candidate, tivozanib. The news adversely impacted AVEO's stock price.
The ODAC mentioned that tivozanib was unable to demonstrate a favorable benefit-to-risk evaluation for the treatment of patients suffering from advanced renal cell carcinoma (RCC).
We note that the ODAC gives independent expert advice and recommendations to the US regulatory body and the FDA is not bound to follow its recommendation but it generally does so.
A New Drug Application (NDA) for tivozanib seeking approval for the treatment of patients with advanced RCC was submitted in Sep 2012. The FDA accepted the application in Nov 2012 with a response expected by Jul 28, 2013.
The FDA's advisory body reviewed findings from 17 studies (n>1,000) including the phase III TIVO-1 (TIvozanib Versus SOrafenib in 1st line Advanced RCC) study. In the TIVO-1 study, tivozanib achieved a statistically significant improvement in the primary endpoint of progression-free survival (PFS) compared to Nexavar.
We are disappointed by the news. We expect investor focus to remain on the response from the FDA for tivozanib. However, we see very low chances of the candidate getting approval at this point.
Tivozanib is being studied in other additional programs and studies as well including the BATON and TAURUS studies. The BATON (Biomarker Assessment of Tivozanib in ONcology) program includes studies assessing tivozanib biomarkers in solid tumors. TAURUS (TivozAnib Use veRsUs Sutent in advanced RCC: Patient Preference) is being conducted to demonstrate patient preference of tivozanib compared to Sutent (sunitinib) as first-line therapy in patients with advanced RCC.
Other pipeline candidates at AVEO include oncology candidates AV-203 and ficlatuzumab.
While AVEO carries a Zacks Rank #2 (Buy), Astellas carries a Zacks Rank #5 (Strong Sell). Currently, Cleveland BioLabs Inc. (Nasdaq:CBLI) looks more attractive in the pharma space with a Zacks Rank #1 (Strong Buy).
Get the full analysis of all these stocks by going to http://at.zacks.com/?id=2649.
About the Bull and Bear of the Day
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