Equity Brief: Ratings Changes for October 30th: ACI, AON, AZN, BJRI, BMRN, CCE, COL, DAN, DFT
Zacks reiterated its neutral rating on shares of Arch Coal, Inc. (ACI). They have a $8.50 price target on the stock. Zacks' analyst wrote, "Arch Coal Inc. reported mixed results in the quarter under review. The top-line results surpassed Zacks Consensus Estimate while the bottom-line lagged it. Despite a challenging thermal market outlook, we believe stable metallurgical coal prospect to some extent would cover up the dullness in the market. The company's high-quality Leer Mine prospect is expected to be a major contributor going forward. Arch Coal's successful cost control initiatives during the quarter and reduction of capital spending on low-return units are positive steps towards boosting margins. However, the slow pace of recovery in global steel usage and increasing pressure from environmental regulations would to some extent impede the growth rate. We maintain a Neutral recommendation on the company."
RBC Capital raised its price target on shares of Aon Co. (AON) from $54.00 to $60.00. They have an outperform rating on the stock.
Zacks reiterated its neutral rating on shares of AstraZeneca (AZN). They have a $49.00 price target on the stock. Zacks' analyst wrote, "AstraZeneca's third quarter 2012 core earnings of $1.51 per ADS beat the Zacks Consensus Estimate of $1.46. Earnings, however, declined 8% (CER) year over year. Lower revenues hurt third quarter 2012 earnings. The company's quarterly revenues fell 15% (CER) year over year to $6.7 billion. AstraZeneca maintained its 2012 adjusted earnings guidance of $6.00 - $6.30 per ADS. We are encouraged by AstraZeneca's focus on the high-potential emerging markets and its efforts to expand its pipeline and portfolio through mergers and acquisitions. However, we remain concerned about the generic competition faced by its key products. The weak late-stage pipeline at AstraZeneca coupled with slow Brilinta uptake also bothers us. We remain Neutral on the stock with a target price of $49.00. The stock carries a Zacks #3 Rank (Hold rating) in the short run"
BMO Capital Markets gave shares of BJ's Restaurants, Inc. (BJRI) a new $37.00 price target. They now have a market perform rating on the stock. They wrote, "BJ's reported 3Q EPS of $0.24, ~flat year over year (ex-items). The result missed the $0.28 Street estimate by $0.04 (~14%). Comps were sluggish, up just 2.3% (~130 bp below the consensus view) despite a 3.4% menu price increase in place in the quarter owing to a 1.1% decline in traffic. As a result, restaurant-level operating margin de-levered 190 bp to 12.4% (~160 bp below our forecast; see details in Exhibit 2). Sales driving initiatives implemented in the quarter (rollout of the Loyalty program, a new menu, and the hourly Beer Master education program) added ~50 bp of margin pressure. Nevertheless, the weak traffic trends, margin compression, and EPS deceleration experienced in the quarter are concerning."
Stephens upgraded shares of BJ's Restaurants, Inc. (BJRI) from an equal weight rating to an overweight rating. Stephens now has a $45.00 price target on the stock, down previously from $50.00.
Zacks reiterated its neutral rating on shares of Biomarin Pharm (BMRN). They have a $41.00 price target on the stock. Zacks' analyst wrote, "BioMarin's third quarter 2012 loss of $0.04 per share was wider than the Zacks Consensus loss estimate of $0.21 and the year-ago loss of $0.16 per share. The narrower loss was due to an increase in total revenues. Total revenues climbed 13% driven by higher net product revenues. We are pleased by the company's efforts to develop its pipeline - top-line phase III data on GALNS is expected by year end. The successful development of GALNS should allow the company to achieve profitability in the second half of 2014. We see limited upside from current levels until more visibility is obtained regarding the pipeline development and hence retain our neutral stance on the stock. Our target price is $41.00. "
Zacks reiterated its neutral rating on shares of Coca-Cola Enterprises (CCE). They have a $33.00 price target on the stock. Zacks' analyst wrote, "Coca-Cola Enterprises' third quarter 2012 adjusted earnings of $0.71 per share beat the Zacks Consensus Estimate by 2.9%. Earnings declined 1.4% from the prior-year quarter, pulled down by currency headwinds and 3.5% decline in net sales. However, reported revenue was in line with the Zacks Consensus Estimate. Organic revenues grew 2.5%. Despite the currency headwinds and economic challenges in Europe, it is encouraging to note that the company's underlying guidance was raised slightly. Overall, we are optimistic about the company's long-term fundamentals. We appreciate the company's strong brand portfolio and solid cash position. The stock is also attractively priced. We therefore maintain a Neutral recommendation on the stock with a target price of $33.00."
JPMorgan Chase reiterated its overweight rating on shares of Rockwell Collins (COL). They have a $65.00 price target on the stock. They wrote, "We are lowering our estimates and price target for COL by 3-4% for lower defense sales and a higher sharecount. The stock has bounced off its summer lows (+14% since mid July vs +4% for the S&P 500), but we still see a strong long-term franchise with a multi-year Commercial earnings ramp ahead. At 10x CY14E EPS, the valuation is not quite as mouth-watering as three months ago but it remains attractive, and with 20% upside to our new Dec 13 target of $65 (down $3), we are maintaining our OW rating."
Jefferies Group gave shares of Dana Holding Co. (DAN) a new $16.00 price target. They now have a buy rating on the stock. They wrote, "DAN shares fell 2.5% (vs. a flat S&P 500) after missing 3Q consensus by 18%. Half the miss was a higher tax rate; the EBITDA miss was a more modest $0.01. Mgmt lowered its 4Q outlook on CV, but offset this with share repurchases of up to $250mn (13% of the mkt cap). We think the stock has an attractive risk/reward into very low expectations. We lower PT to $16, but maintain Buy."
Jefferies Group gave shares of DuPont Fabros Technology, Inc. (DFT) a new $23.00 price target. They now have a hold rating on the stock. They wrote, "DFT stock dropped almost 10% the day after 3Q12 earnings release on concerns of rental rate pressure and slow leasing velocity. With overall sluggish leasing during the quarter in addition to a significant rent decline on the extended leases (6% GAAP, 18% cash), investors (us included) are increasingly concerned about DFT's leasing fundamentals."
Zacks reiterated its neutral rating on shares of Dollar Financial Corp. (DLLR). They have a $18.00 price target on the stock. Zacks' analyst wrote, "DFC Global's fiscal first-quarter 2013 earnings lagged the Zacks Consensus Estimate as well as the year-ago earnings due to a substantial increase in operating expenses, which managed to offset revenue growth. Nevertheless, the top line was in line with expectations, driven by higher consumer lending. The company has expanded its reach in internet lending business in Sweden, Finland, Poland and Canada. It also opened 23 new de novo stores in U.K., Canada, Spain and Poland in the quarter to widen its store base. However, cash checking revenue continues with the downward trend as operating expenses continue to escalate. Nevertheless, higher consumer lending continues to drive revenue growth. Going ahead, the company is also expected deploy the available funds in a manner that will further enhance future earnings. "
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