Zacks Equity Research highlights Dell, Inc. (Nasdaq: DELL) as the Bull of the Day and H&R Block (NYSE: HRB) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on CNOOC, Ltd. (NYSE: CEO) and Logitech (Nasdaq: LOGI). Full analysis of all four 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 Dell, Inc. (Nasdaq: DELL). Although Dell has struggled as of late, we believe that the worst is behind the company, with improving results driven by Dell’s pricing discipline and cost cutting initiatives. Over the longer-term the company should benefit from its improved service initiatives and refreshed product line. Dell will file past-due reports with SEC soon, lifting an overhang on the stock. We therefore maintain a Buy rating on DELL shares with a six month price target of $30.00.
Bear of the Day:
Our Bear of the Day recommendation is for H&R Block (NYSE: HRB). We maintain our Sell rating for HRB following the release of Q1 results. Significant uncertainties remain with respect to the pending disposal of the company’s Option One mortgage business. While the company’s core tax business is showing signs of improvement, we consider the issues regarding the potential sale of Option One to be of paramount importance from an investment perspective at this time. Until the picture regarding this sale becomes clearer, we would not recommend that investors initiate new positions in HRB with the share price near current levels. We do not believe that significant price appreciation is warranted in the near-term.
Analyst Blog:
CNOOC's (NYSE: CEO) revenue for the first half of 2007 declined year-over-year due to a decline in oil prices. However, the company continues to achieve steady growth in oil and gas production and reserves. Although there are concerns related to the volatility in global oil prices, higher operating costs and regulatory changes, we think that the company's current valuation does not fairly reflect its positive production growth profile and leverage to the Chinese natural gas market. Therefore, we maintain our Buy rating on the stock.
Logitech (Nasdaq: LOGI) reported a mixed first quarter of 2008, with revenues below our estimates but earnings in-line with our expectations. This was impressive, given the unexpected decline in webcam sales experienced in Europe during the quarter, which hindered growth. Despite this, the company was still able to improve its gross margin due to a more-favorable product mix. While we were disappointed with the weak webcam sales, we were surprised by the continued strength in the rest of the company's product portfolio, which was up 19% year over year, excluding the video business. We continue to rate shares of LOGI a Buy.
Get the full analysis of all four 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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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.
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