CHICAGO, Nov. 26, 2013 /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 the Apple Inc. (Nasdaq:AAPL-Free Report), Microsoft (Nasdaq:MSFT-Free Report), Google (Nasdaq:GOOG-Free Report), Amazon (Nasdaq:AMZN-Free Report) and Agilent Technologies Inc. (NYSE:A-Free Report).
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Here are highlights from Monday's Analyst Blog:
Apple to Acquire PrimeSense
Apple Inc. (Nasdaq:AAPL-Free Report) recently announced its decision to take over Israeli company PrimeSense Ltd. for approximately $350.0 million. PrimeSense developed the motion tracking chip technology, specifically used by Microsoft (Nasdaq:MSFT-Free Report) in its Kinect game console.
PrimeSense received funding from investors such as Canaan Partners, Silver Lake, Gemini Israel Funds as well as Genesis Partners. This helped the company to extend its technology beyond gaming, and helped it to develop a new depth-sensing technology. This technology helps mobile phone 3D cameras to enable apps like indoor navigation tools or 3D shopping catalogs.
Apple pursues an innovative acquisition strategy, whereby it buys small technology firms which help it to grow inorganically. We believe that PrimeSense's technology that enables digital devices to detect movements and objects, which are then graphically represented in different colors, which will find a place in Apple's future products.
Moreover, this acquisition will give Apple the opportunity to utilize some of its cash reserve effectively.
We believe this is a win-win situation for both Apple and PrimeSense, as Apple would be able to access a new technology, while PrimeSense would get the support of a sector behemoth such as Apple.
Apple is facing significant competition in most of the markets from Google's (Nasdaq:GOOG-Free Report) Android operating system. The company continues to lag Samsung in worldwide smartphone shipment. As per data available from IDC, Apple had 13.0% market share compared with Samsung's 31.0% at the end of the third quarter of 2013.
We believe that acquisitions like these will help Apple to add new features to its already popular iPhone series, which will inturn help it to justify its pricing.
The significant decline in revenues in the U.S and Rest of Asia suggests market share loss to low cost smartphones and tablets produced by Samsung, HTC, LG, Huawei and Amazon (Nasdaq:AMZN-Free Report). Besides Samsung, we expect Apple to face stiff competition from Microsoft in the U.S. smartphone market going forward.
Currently, Apple has a Zacks Rank #3 (Hold).
Agilent Approves Buyback, Hikes Dividend
Agilent Technologies Inc. (NYSE:A-Free Report), a broad-based original equipment manufacturer (OEM) of test and measurement equipment, has approved a new stock repurchase program, to become effective after the existing $1 billion repurchase program concludes.
Apart from rewarding the shareholders, the new program will also reduce the dilution resulting from stocks issued as compensation to its employees.
Additionally, the company announced its decision to raise the quarterly dividend by 10% to 13.2 cents per share from 12 cents. This translates into a 10% increase from the prior dividend. The increased dividend will be paid on Jan 22, 2014, to stockholders of record on Dec 31, 2013. Prior to this announcement, Agilent had been paying a quarterly dividend of 12 cents per share.
Agilent's business model reflects the company's commitment toward returning value to shareholders with its strong cash generation capabilities. We believe that the continued share buybacks and dividend hike will increase investors' enthusiasm for the shares.
Agilent's strong balance sheet and cash flows provide financial flexibility in matters of incremental dividend, share repurchases and acquisitions. During the last concluded quarter, Agilent paid dividend worth $39 million, but did not repurchase any share.
The cash and cash equivalents were $2.68 billion at quarter-end, having increased $345 million during the quarter. The debt cap ratio was 33.8%. We remain encouraged by Agilent's strong cash position and its ability to service its long-term debts.
Agilent reported decent fiscal fourth-quarter results, with both revenues and earnings per share surpassing our expectations. We remain positive about Agilent's broader portfolio and increased focus on segments with higher growth potential.
Currently, Agilent has a Zacks Rank #3 (Hold).
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