Zacks Bull and Bear of the Day Highlights: WellPoint, Masco Corporation, Chevron Corporation, BP plc and Exxon Mobil Corporation

CHICAGO, July 21, 2011 /PRNewswire/ -- Zacks Equity Research highlights WellPoint (NYSE: WLP) as the Bull of the Day and Masco Corporation (NYSE: MAS) as the Bear of the Day. In addition, Zacks Equity Research provides analysis Chevron Corporation (NYSE: CVX), BP plc (NYSE: BP) and Exxon Mobil Corporation (NYSE: XOM).

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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:

Bull of the Day:

We are upgrading our recommendation on WellPoint (NYSE: WLP) to Outperform based on its ability to generate higher premiums and control costs, which enhances operational efficiencies. The company's first quarter earnings came in above the Zacks Consensus Estimate, spurred by significant reduction in SG&A expenses and a jump in medical enrollment.

Additionally, the effort to bring down the rate of rising health care costs contributed to the increase. The sale of the NextRx subsidiaries also strengthened the balance sheet and fueled stock repurchase and the CareMore acquisition.

With its leading market share positions, diversified product portfolio and consistency, WellPoint has strong long-term growth potential. Our six-month target price of $88.00 equates to 12.4x our earnings estimate for 2011.

Bear of the Day:

Masco Corporation (NYSE: MAS) is highly dependent on the U.S. housing industry. Falling prices have made homes a less lucrative investment to buyers, which reduces demand for Masco products. Rising prices of raw materials are also affecting margins to a large extent.

In addition, Masco is vulnerable to unfavorable currency fluctuations due to its extensive international presence. The company's high dependency on a few individual customers offers little room for margin expansion. In the most recent quarter, the company reported a loss of $0.05 per share, which was wider than the Zacks Consensus Estimate for a loss of $0.03.

Our long-term Underperform recommendation on the stock indicates that it will perform below the overall market. Our $11 target price, 52.4x our 2011 EPS estimate, reflects this view.

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Chevron Sheds Alaskan Assets

Chevron Corporation (NYSE: CVX) has entered into a deal with privately held exploration and production company Hilcorp Energy to sell all of its interests in Alaska's Cook Inlet basin. Chevron will execute the deal through its wholly owned Alaskan subsidiary, Union Oil Co. of California. The financial terms of the deal were not disclosed.

The properties included in the disposition pact comprise Chevron's interests in the Granite Point, Middle Shoals, Trading Bay and MacArthur fields along with interests in 10 offshore platforms and onshore gas fields. The sale of two gas-storage facilities and the company's interests in the Cook Inlet Pipe Line Co and Kenai Kachemak Pipeline LLC are also part of the deal.

Spread over 176,000 acres of land in Alaska, the to-be sold assets generate a net daily production of 3,900 barrels of oil and 85 million cubic feet of natural gas. The deal, pending customary regulatory approvals, is slated for closure this year end.

Chevron intends to keep its 1.36% stake in the Trans Alaska Pipeline System along with interests in several Alaska North Slope fields. As a part of the company's asset base restructuring strategy, management announced plans to dispose Cook Inlet assets last October.

We believe that California-based Chevron exhibits strong growth momentum in the coming years as reflected by the targeted volume growth of 20% by 2017. With the economic rebound and rallying oil prices, we expect the company to continue to accelerate revenue and earnings growth over the next few quarters.

We also appreciate Chevron's initiatives to trim its less lucrative operations and concentrate on high profit generating exploration and production business. In this regard, the company is already in the process to sell various properties in more than 20 counties, including Spain, Caribbean and southern Africa.

Given the optimistic outlook, we expect Chevron to perform better than its peers such as BP plc (NYSE: BP) and Exxon Mobil Corporation (NYSE: XOM) and maintain our long-term Outperform rating on the stock.

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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