Zacks Bull and Bear of the Day Highlights: Vodafone, Builders FirstSource, Rent-A-Center...

Zacks Bull and Bear of the Day Highlights: Vodafone, Builders FirstSource, Rent-A-Center and Johnson Controls.

CHICAGO--(Business Wire)--Zacks Equity Research highlights Vodafone (NYSE: VOD) as the Bull
of the Day and Builders FirstSource (Nasdaq: BLDR) as the Bear of the
Day. In addition, Zacks Equity Research provides analysis on
Rent-A-Center (Nasdaq: RCII) and Johnson Controls (NYSE: JCI). Full
analysis of all these stocks is available at
http://at.zacks.com/?id=2676.

Here is a synopsis of all four stocks:

Bull of the Day:

Our Bull of the Day recommendation is for Vodafone (NYSE: VOD). We
expect the firm to continue delivering solid operating results, while
increasing shareholder returns through higher dividend payments and
share repurchases. The company maintains a healthy dividend pay out
ratio of 60%. Meanwhile, momentum is also building for the company's
3G (Third Generation) wireless services and Vodafone is gaining market
share in most of its key markets. Furthermore, the company is focusing
on opportunities in untapped emerging markets, such as South East Asia
to foster growth. Recent acquisitions and divestitures are forecasted
to provide operational efficiency and expand top-line revenue over
time.

Bear of the Day:

Our Bear of the Day recommendation is for Builders FirstSource
(Nasdaq: BLDR). We maintain our Sell rating on Builders FirstSource
and lower our target price from $7 to $5. The company continues to
face an uphill battle in an extremely difficult housing industry.
Housing activity continues to decline along with lumber prices. These
are trends that should persist well into 2008, negatively impacting
BLDR's sales and earnings for the next few quarters. That said, we
think the company is a strong operator that should continue to take
market share, but its business model will not be able to overcome the
overall weakness in the housing industry. We would continue to avoid
the stock. BLDR reports fourth quarter results on February 21.

Analyst Blog:

Rent-A-Center (Nasdaq: RCII) announced that it was going to close
280 stores by the end of the first quarter of 2008. Management
indicated that the store closings will provide the company with a
pre-tax benefit of $2 to $2.5 million per month, or $0.17-$0.21 per
share in 2008. Hence, we are boosting our 2008 estimates. The store
closings make sense given the difficult economic environment for
Rent-A-Center's target market. That said, RCII shares are trading at
about 6x our 2008 EPS estimate. We believe this valuation should help
limit the downside risk in the stock. RCII shares are trading at 5.9x
our 2008 EPS estimate. This valuation looks cheap, but we think it
reflects the problems associated with the company's core customer
base.

Johnson Controls' (NYSE: JCI) cost reduction efforts, accretive
acquisitions, and healthy operating cash flows are driving the stock.
Further, JCI commands a strong market share in the respective markets
in which it operates. The company has started benefiting from the York
acquisition, and will further benefit as it begins to integrate the
Delphi Battery business. On January 18, 2008, Johnson Controls
reported first quarter 2008 results. In the reported quarter, diluted
earnings per share (excluding non-recurring tax benefits) were $0.39,
up 39% from the corresponding quarter of the previous year. Total
sales were $9.5 billion, reflecting a rise of 16% year-over-year.
Currently, JCI shares are trading at approximately 12.9x our 2008
estimate of $2.47. JCI is expected to report higher earnings in the
coming years backed by acquisition benefits and success in overcoming
increasing raw material costs and weakening prices.

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.

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