Zacks Bull and Bear of the Day Highlights: Valmont Industries, Quest Diagnostics, Novartis, Abbott and Eli Lilly
CHICAGO, Feb. 21, 2013 /PRNewswire/ -- Zacks Equity Research highlights Valmont Industries (NYSE:VMI) as the Bull of the Day and Quest Diagnostics (NYSE:DGX) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Novartis (NYSE:NVS), Abbott (NYSE:ABT) and Eli Lilly (NYSE:LLY).
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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:
Valmont Industries (NYSE:VMI) is primarily engaged in the production of fabricated metal products, metal and concrete pole and tower structures and mechanized irrigation systems in the U.S. and abroad.
Customers and end-users of Valmont's products include state and federal governments, contractors, utility and telecommunication companies, manufacturers of commercial lighting fixtures, large farms as well as the general manufacturing sector.
Roughly 45% of total sales last year were either achieved in markets or produced by manufacturing plants outside of North America. The company has diversified geographically to over 100 countries.
In Valmont's fourth-quarter 2012 earnings report last week, the company posted EPS of $2.43 per share, outstripping the Zacks Consensus Estimate of $2.24 while declining from the prior-year quarter's earnings of $4.33 per share.
While profit slid roughly 43% year over year to $65 million in the reported quarter, the year-ago quarter's profit was boosted by one-time benefits associated with the reorganization of the company's legal structure. Barring that benefit, earnings were $1.83 per share a year ago.
Quest Diagnostics, a leading provider of medical diagnostic testing services, reported a lackluster fourth quarter 2012 on January 23 with adjusted EPS of $1.01, down 15.8% year over year, missing the Zacks Consensus Estimate by $0.05
Fourth quarter results for Quest Diagnostics (NYSE:DGX) were of particular concern when seen from the top line. Year over year sales declined 4% primarily due to 4.4% drop in diagnostic information services revenues that accounts for over 90% of total revenues of the company.
Adjusted operating margin in the quarter contracted 232 basis points (bps) to 15.98%. Additionally, analysts are concerned about the company guidance for 2013 given market and competitive challenges. Quest Diagnostic's expected revenue growth for the upcoming fiscal quarter is to remain within a band as low as 0% to 1%, missing the Zacks Consensus Estimate of $7.5 billion that represents annualized growth rate of 1.4%.
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Label Expansion for Novartis Drug
Novartis (NYSE:NVS) recently announced that the US Food and Drug Administration (FDA) has approved Zortress (everolimus) for an additional indication.
Zortress is now approved for the prophylaxis of organ rejection in adults undergoing a liver transplant.
The approval was based on results from a phase III randomized study, which was conducted in 719 liver transplant patients starting 30 days post-transplant. The study spanned over 12 months.
Zortress reported revenues of $210 million in 2012, up 20% year over year driven by robust demand.
We note that Zortress is already approved in the US for the prophylaxis of organ rejection in adult patients undergoing kidney transplant.
The approval for the new indication makes Zortress the first mTOR inhibitor approved to prevent organ rejection in adult liver transplant patients in the US. We expect that the recent approval will further boost Zortress sales.
We remind investors that everolimus was approved by EU for use in adult liver transplant patients in the fourth quarter of 2012 under the trade name Certican.
Certican is already approved in more than 90 countries namely Chile, Philippines and Argentina to prevent organ rejection for renal and heart transplant patients. In most EU member countries, Certican is also approved in kidney and heart transplantation.
Novartis has also licensed Zortress to Abbott (NYSE:ABT) and sub-licensed to Boston Scientific for use in drug-eluting stents.
Currently, Novartis carries a Zacks Rank #3 (Hold). Large-cap pharma companies that currently look better-positioned include Eli Lilly (NYSE:LLY), a Zacks Rank #2 (Buy) stock.
Get the full analysis of all these stocks by going to http://at.zacks.com/?id=2649.
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