Zacks Bull and Bear of the Day Highlights: Allegheny Energy, Novatel, H&R Block,...

Zacks Bull and Bear of the Day Highlights: Allegheny Energy, Novatel, H&R Block, NetEase.com and Neurocrine Biosciences

CHICAGO--(Business Wire)--
Zacks Equity Research highlights Allegheny Energy (NYSE: AYE) as
the Bull of the Day and Novatel Wireless (Nasdaq: NVTL) as the Bear of
the Day. In addition, Zacks Equity Research provides analysis on H&R
Block (NYSE: HRB), NetEase.com, Inc. (Nasdaq: NTES) and Neurocrine
Biosciences (Nasdaq: NBIX). Full analysis of all these stocks is
available at http://at.zacks.com/?id=2676.

Here is a synopsis of all five stocks:

Bull of the Day: Allegheny Energy (NYSE: AYE)

We expect that the company's regulated delivery utility business
will provide steady earnings growth, while the generation business
will provide an additional boost to earnings. Accordingly, we maintain
a BUY recommendation on AYE common stock with a six-month target price
of $51.75.

Price appreciation to our near-term valuation target, coupled with
the reinstated regular quarterly cash dividend of $0.15 per share
after a gap of five years, which we deem sustainable and secure,
represents annualized total return potential of 26.5%.

Bear of the Day: Novatel Wireless (Nasdaq: NVTL)

Novatel did not provide any specific time frame, or visibility,
when improved opportunities from its new products can be derived. In
addition, the market for wireless data access equipment has recently
become more competitive as several large vendors launched innovative
products with attractive pricing.

Novatel's second quarter 2008 preliminary earnings results were
significantly below our estimates. We downgrade our recommendation to
a Sell as we assess appropriate signs for improved conditions.

Latest Posts on the Zacks Analyst Blog:

H&R Block (NYSE: HRB)

We reiterate our Hold rating on shares of H&R Block following the
release of Q1 financial results. Although the fallout from the
mortgage business implosion will likely be felt for some time to come,
and we continue to have significant concerns regarding other aspects
of HRB's business, we believe that negative and positive aspects of
the company's outlook are now roughly balanced. Steps have been taken
by the management to refocus the company on its core tax businesses,
and the emphasis on expense reduction should result in improved
margins going forward. Our price target of $23.50 per share represents
a multiple of 15x our 2009 EPS estimate.

NetEase.com, Inc. (Nasdaq: NTES)

NetEase.com is one of the leading providers of online gaming,
advertising, web-based communication services, and a variety of
interactive content in China.

NetEase is currently trading at 16.8x estimated 2008 EPADR of
$1.56, a discount to the industry. Rolling our valuation to fiscal
2009 EPADR estimate of $1.74, the company is trading at 15.1x, which
is far below the industry average. NetEase faces intense competition
in the gaming and advertising market. Delayed product launches and
growing operating expenses have hurt profitability.

Neurocrine Biosciences (Nasdaq: NBIX)

We have long stated that Neurocrine Biosciences' stock is stuck in
a tight trading range until investors get an update on both elagolix
and indiplon. We got the first update in early September when the
management released very positive phase II data from the PETAL study
on GnRH (gonadotropin-releasing hormone) antagonist elagolix. This
encouraging data for the treatment of endometriosis should lead to the
signing of a major partnership for pivotal trials in 2009.

As for insomnia drug indiplon, we assume the product is eventually
discontinued in the U.S. However, with elagolix now taking center
stage, Neurocrine is well positioned to outperform in 2009. We still
believe that investors can be patient while additional elagolix
becomes available, but we are moving our price target to $8, from $6,
on the increased likelihood that a deal for elagolix gets done in the
next several 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.

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Copyright Business Wire 2008