Zacks Bull and Bear of the Day Highlights: Restoration Hardware Holdings, Expedia, FedEx, Boeing and United Parcel Service
CHICAGO, June 5, 2013 /PRNewswire/ -- Zacks Equity Research highlights Restoration Hardware Holdings, Inc. (NYSE:RH) as the Bull of the Day and Expedia Inc. (Nasdaq:EXPE) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on FedEx Corp. (NYSE:FDX), The Boeing Company (NYSE:BA) and United Parcel Service, Inc. (NYSE:UPS).
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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:
With stocks and luxury housing prices in major cities around the globe hitting new record highs, Restoration Hardware Holdings, Inc. (NYSE:RH) is perfectly situated to grow its luxury furniture brand. This Zacks Rank #1 (Strong Buy) is expected to post double digit earnings growth both this year and next.
It operates 74 galleries and 13 outlets selling furniture, lighting, bathware, outdoor and garden as well as baby & child products. If you've hung out in the interior decoration section of your local bookstore, you might also have seen some of its books. The company also operates a retail web site at RH.com.
Restoration Hardware has had a topsy-turvy history as it nearly went under in the early 2000s and was privately-owned for several years. It re-emerged as a publicly traded company in late 2012.
Is it a coincidence that Restoration Hardware, which has long been associated with luxury, went public just as the housing market was turning around? I think not.
Restoration Hardware has beaten its first two quarters as a public company. It is set to report fiscal first quarter on July 16 but the company has already clued us in on how good 2013 has been. On May 10, it increased first quarter fiscal 2013 guidance to $0.02 to $0.04 from a loss of 2 cents to breakeven.
A big miss on the Zacks Consensus Estimate in Q1 has analysts scrambling to cut 2013 estimates on Expedia Inc. (Nasdaq:EXPE). Growth is now expected to decline on this Zacks Rank #5 (Strong Sell) by 8.4% in 2013.
Expedia is a well known online travel company that operates several travel sites in the United States and globally including Expedia.com, Hotels.com, Hotwire.com and, in China, eLong.
Expedia is the majority holder in eLong which is a bright spot in the business. It saw 71% year over year growth in room nights in China in the first quarter.
On Apr 25, Expedia reported first quarter results and despite growing revenue 24% year over year due to strong growth in the Americas, Europe and Asia-Pacific, it wasn't quite as good as the analysts had been hoping for.
It reported a loss of 24 cents, missing the Zacks Consensus by 35 cents, or 318%. It was the first earnings miss in 5 quarters.
Latest Posts on the Zacks Analyst Blog:
FedEx Raises Dividend
One of the largest package delivery companies, FedEx Corp. (NYSE:FDX) has raised its quarterly dividend by a penny per share to 15 cents. The increased dividend is payable on Jul 1 to stockholders of record on Jun 17. We believe that the company's focus on increasing investor return is backed by its strong financial strength from operational efficiency.
In an effort to lower cost, the company is concentrating on network realignment to match the current demand level. In Jun 2012, the company announced plans to purchase 19 more Boeing 767 aircraft. FedEx expects the delivery of these aircraft from 2015 through 2019.
These new aircraft are expected to benefit cost structure by replacing the old fleet of MD-10 and A31-200 as well as by exchanging equipment like spare parts, tooling and flight simulators with the existing FedEx Boeing 757 Fleet. Additionally, FedEx delayed the delivery of eleven 777-freighter aircraft that were scheduled to be delivered between 2013 through 2018.
We believe the delayed deliveries would help in better utilization of the MD-11 fleet on international flights and lower overall cost and investment. Going forward, FedEx would buy 30 Boeing 757 passenger airplanes from United Continental Holdings Inc. with deliveries between the latter half of 2013 through 2015.
The company aims to convert these narrow-body jets into its freighters fleet and utilize them for cargo delivery. These twin-engine based airliners are not only fuel efficient but are also capable of transporting 20% extra freight than the three-engine Boeing 727s that would be replaced. However, this conversion process is expected to take around three months at a cost of nearly $5 million per plane.
Further, the company also announced the retirement of 86 aircraft and 308 related engines to improve the network efficiency at FedEx Express. The company expects the complete retirement of The Boeing Company (NYSE:BA) B727-200 fleet. The company expects to incur around $100 million in impairment charges this year and a depreciation expense of $74 million in FY14.
We believe the investments in organic growth as well as acquisitions will lead to greater operational efficiencies, generating significant long-term synergies, supporting international business growth and driving higher profitability. These will also provide a competitive advantage over peers like United Parcel Service, Inc. (NYSE:UPS).
Get the full analysis of all these stocks by going to http://at.zacks.com/?id=2649.
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