Zacks Bull and Bear of the Day Highlights: Sunoco Logistics Partners, LP, Computer Sciences, Interpublic Group of Companies, Omnicom Group and WPP plc
CHICAGO, Aug. 17, 2011 /PRNewswire/ -- Zacks Equity Research highlights Sunoco Logistics Partners, LP (NYSE: SXL) as the Bull of the Day and Computer Sciences Corp. (NYSE: CSC) as the Bear of the Day. In addition, Zacks Equity Research provides analysis Interpublic Group of Companies, Inc. (NYSE: IPG), Omnicom Group Inc. (NYSE: OMC) and WPP plc (Nasdaq: WPPGY).
(Logo: http://photos.prnewswire.com/prnh/20101027/ZIRLOGO)
Full analysis of all these stocks is available at http://at.zacks.com/?id=2678.
Here is a synopsis of all five stocks:
Buoyed by a robust operating performance and favorable growth prospects, we are upgrading Sunoco Logistics Partners, LP (NYSE: SXL) to Outperform from Neutral. Recent results for Sunoco Logistics have been driven by strength in its crude pipeline system and terminals facilities.
Importantly, the partnership has grown its cash distribution for twenty-five consecutive quarters. With its stable fee-based revenue, geographically-diverse assets and strong business fundamentals, Sunoco Logistics offers investors an opportunity to capture income growth through steadily-rising cash distributions and capital appreciation.
Therefore, we are confident of the partnership's total return potential. Its current quarterly distribution of $1.215 per unit ($4.86 per unit annualized) is up from $0.45 per unit ($1.80 per unit annualized) at the time of its 2002 IPO.
Computer Sciences Corp. (NYSE: CSC) is one of the leading players in the information technology (IT) services industry. We are apprehensive about the intense competition in the IT and cloud computing space from both small and big players such as Accenture and Hewlett-Packard.
Moreover, with government orders expected to dry up to a certain extent and the National Health Services realization getting pushed to future quarters, things look difficult for the company. Moreover, the demand for the company's products in Europe is not encouraging for the upcoming quarters.
While we are positive on the company we are a bit concerned about the competition it faces from larger players and its high outstanding debt. We maintain an Underperform rating on CSC and set a price target of $27.00, representing a P/E of 5.9x our 2012 EPS estimate.
Latest Posts on the Zacks Analyst Blog:
Interpublic Sells Half of Facebook Stake
Advertisement giant Interpublic Group of Companies, Inc. (NYSE: IPG), which bought approximately 0.5% stake in Facebook (FB) way back in 2006, has reached an agreement to sell approximately half of its investment for $133 million to an undisclosed buyer.
The interest, amounting to about 0.5% of Facebook's total shares, was bought for less than $5 million in 2006, which Facebook agreed to sell to Interpublic in exchange for the company's agreement to spend $10 million with Facebook for the clients of its agencies.
Since then, the strategic value of Interpublic's initial investment in the social network has moderated, while the financial value of the stake appreciated significantly over time. This has brought a fair prospect for Interpublic to divest a portion of their position for net cash proceeds of $133 million in a private negotiation. Interpublic group expects a pre-tax gain of $132 million, upon closing of the sale.
The money will be utilized toward Interpublic's existing program of repurchasing shares of its common stock. The board has authorized an increase in the share repurchase program by $150 million, a rise of $450 million from its initial $300 million; creating opportunity to further enhance shareholder value, reflecting long-term prospects.
Interpublic acquired the stake in 2006 in an effort to signal the current and potential clients, the company's presence in the field of social marketing as well as its attempt in identifying strategic partnerships while realizing financial gain.
Facebook, which was then valued in the range of $200 million to $300 million, has increased more than fivefold in less than two years, with a value of $66.5 billion in a recent share sale, ahead of its expected initial public offering next year.
On this backdrop, Interpublic's divestment of half of its stake is being seen as an indication that the secondary market for the social network's shares may be at an all time high level.
New Yorkbased, Interpublic Group of Companies Inc. together with its subsidiaries, provides advertising and marketing services worldwide. The company directly competes with its peers, such as Omnicom Group Inc. (NYSE: OMC), Publicis Groupe SA and WPP plc (Nasdaq: WPPGY).
We currently maintain a long-term Neutral recommendation on the stock. Interpublic Group has a Zacks #4 Rank, which translates into a short-term Sell rating (1-3 months).
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
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. Subscribe to this free newsletter today by visiting http://at.zacks.com/?id=7158.
About Zacks
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leonard Zacks. As a PhD from MIT 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=4582.
Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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
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.
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
[email protected]
http://www.zacks.com
SOURCE Zacks Investment Research, Inc.
Share this article