The Zacks Analyst Blog Highlights: Amazon.com, eBay, Netflix, Apple and Caterpillar

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Oct 02, 2012, 09:30 ET

CHICAGO, Oct. 2, 2012 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Amazon.com, Inc. (Nasdaq:AMZN), eBay Inc (Nasdaq:EBAY), Netflix Inc (Nasdaq:NFLX), Apple Inc (Nasdaq:AAPL) and Caterpillar Inc. (NYSE:CAT).

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Here are highlights from Monday's Analyst Blog:

Amazon to Sell Wine Online

The world's largest Internet retailer Amazon.com, Inc. (Nasdaq:AMZN) announced that it is planning to sell wines online.

The company started its wine business way back in 1999 with a 45% stake in Wineshopper.com, but closed down 10 years later as the business did not perform to expectations. It is now re-starting in a much smaller way, selling wines directly to consumers in Napa Valley, California.

Amazon is clearly driven by this very big market. It is true that growth prospects may not be so exciting (a ResearchAndMarket study estimates a 3% CAGR to 2013). However, given the size of the market ($33.5 billion by 2013), Amazon would see big gains if it is able to convert even a fraction of these sales to its online model. .

Amazon has room for expansion in this unique segment. Wine lovers are present at every nook and corner of the world. So its current selection of Chardonnay, Pinot Grigio, Pinot Noir, Champagne and other exquisite wines could see more takers.

Amazon is one of the leading players in the extremely fast-growing retail ecommerce market that includes players like eBay Inc (Nasdaq:EBAY), Netflix Inc (Nasdaq:NFLX), Apple Inc (Nasdaq:AAPL) and others. While the strong growth prospects are making the market more competitive by the day, Amazon continues to maintain and even grow its share on the back of its consistent and reliable service. Amazon's scale of offerings, its broad reach and platform approach are the keys to its success.

Amazon's second quarter results were more or less within expectations. Reported revenue of $12.83 billion was down 2.7% sequentially and up 29.5% from the year-ago quarter. This was better than the guidance for the quarter of $11.9-13.3 billion (down 4.4% sequentially, or up 27.1% year over year at the mid-point) and in line with consensus expectations. Year-over-year revenue growth was 32%, excluding an unfavorable currency impact.

Currently, Amazon has a Zacks #3 Rank, which implies a Hold rating in the near term.

Caterpillar Announces Price Hike

Caterpillar Inc. (NYSE:CAT), the world's largest manufacturer of construction and mining equipment, has implemented a price increase of up to 3% on most of its machines across the world, citing current industry factors and general economic conditions as the reasons. This price increase will be effective January 2013 and includes adjustments to list prices and merchandising support.

The price increase will vary geographically as well as by the type of equipment. In addition, the company intends to increase prices by up to 7% on select models for applicable regions to cover the cost of incremental pollution-reduction components to comply with stricter federal standards.

Earlier in October 2011, the company had announced price increase of up to 2% worldwide, effective January 2012. The company had also implemented an emissions-related price increase of 2% to 6% for applicable products and regions

In a separate development, the company recently trimmed its guidance for fiscal 2015, due to modest and insipid economic growth expectations through 2015 and a less likely scenario of a worldwide recession. Caterpillar expects to generate revenues in the range of $80 to $100 billion in 2015 and earnings per share in the range of $12 to $18 per share. Caterpillar had earlier estimated earnings between $15 and $20 per share.

For 2012, the company remains firm on its guided record sales of $68 billion to $70 billion and EPS forecast at $9.60. Caterpillar will discuss its 2013 expectations when it releases its quarterly earnings next month. The year 2013 is expected to be similar to 2012 with respect to worldwide economic growth, and better growth expected in 2014.

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