CHICAGO, Jan. 30, 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 Ford (NYSE: F), Procter & Gamble (NYSE: PG), Starbucks (Nasdaq: SBUX), Eastman Chemicals (NYSE: EMN) and Solutia (NYSE: SOA).
(Logo: http://photos.prnewswire.com/prnh/20101027/ZIRLOGO)
Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=5513
Here are highlights from Friday's Analyst Blog:
GDP So-So, Europe Better
While we do have some favorable-looking headlines out of Europe this morning, indicating that Greece is making progress in its talks with the private creditors, the focus today will be on the U.S. economy. The headlines on that count are on the weak side.
In its first read on the fourth quarter of 2011, the commerce department reported that the U.S. economy expanded at a lower than expected 2.8% pace in the last quarter of 2011, up from the third quarter's 1.8% growth rate. The expectation was for the GDP number to be 3%, with many looking for growth rates above that level. Weak spending by the government and consumers drove the miss. The overall composition of the 2.8% growth is also of relatively lower quality, with corporate investments coming down and inventories contributing most of the growth. Personal consumption expenditures (PCE), or consumer spending, which accounts for close to 70% of the economy, increased by 2%, compared to the 1.7% increase in the third quarter and the 0.7% growth in the second quarter. The expectation was for fourth quarter PCE to come in at 2.4%. The major swing element in today's GDP report relative to the preceding quarter was inventories, which contributed +1.9% to growth this quarter, instead of being the 1.4% drag in the previous one. Corporate capital spending dropped sharply to its lowest quarterly pace. Business investments in computers and software increased 5.2%, down from the third quarter's 16.2% pace. This is largely a function of the accelerated depreciation allowance, which pulled forward some of the corporate spending, likely resulting in relatively softer readings through the first quarter of 2012. A major drag on growth came from weak government spending, with defense outlays dropping 12.5%, compared to the 5% increase in the third quarter. GDP growth rate in the current quarter (first quarter of 2012) is expected to come down to the 2% range, largely due to give back on the inventories front and another quarter of soft corporate spending. But the rate is expected to move up in the back half of the year due to two drivers.
First, the emerging labor market momentum helps improve PCE. Second, corporate spending gets back to trend pace in the following quarters. Thursday's better-than-expected Durable Goods orders shows strong momentum in corporate spending, meaning that the soft patch in corporate spending will be fairly short lived. This is expected to push quarterly GDP growth rate to the 2.5% range in the second half of 2012.
On the earnings front, Ford (NYSE: F) came up short of expectations, though the company reported a big headline earnings number, largely due to a non-cash accounting gain. Ford had problems in Europe and Asia, owing to economic issues in Europe and floods in Thailand.
Procter & Gamble(NYSE: PG) came ahead of earnings expectations on in-line revenue in an otherwise noisy quarter.
Starbucks(Nasdaq: SBUX) reported better-than-expected results after the close on Thursday, though management's guidance turned out to be underwhelming.
In other corporate news, Eastman Chemicals (NYSE: EMN) announced the acquisition of fellow specialty chemicals maker Solutia (NYSE: SOA) in a roughly $3.4 billion stock and cash deal. This is an attractive 42% premium for Solutia shareholders.
Want more from Zacks Equity Research? Subscribe to the free Profit from the Pros newsletter: http://at.zacks.com/?id=5515.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today: http://at.zacks.com/?id=5517
About Zacks
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leon Zacks. As a PhD from MIT Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at http://at.zacks.com/?id=5518.
Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
Follow us on Twitter: http://twitter.com/zacksresearch
Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts
Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
[email protected]
http://www.zacks.com
SOURCE Zacks Investment Research, Inc.
Share this article