CHICAGO, Sept. 23, 2014 /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 GlaxoSmithKline (NYSE:GSK-Free Report), Verizon Communications (NYSE:VZ-Free Report), AT&T, Inc. (NYSE:T-Free Report), Sprint Corp. (NYSE:S-Free Report) and T-Mobile US, Inc. (NYSE:TMUS-Free Report).
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
Here are highlights from Monday's Analyst Blog:
Glaxo Fined $484M in China Bribery Probe
GlaxoSmithKline (NYSE:GSK-Free Report) announced that the company's Chinese subsidiary, Glaxo China Investment Co. Ltd has been found guilty of bribing non-government personnel by the Changsha Intermediate People's Court in Hunan Province, China. The court levied a fine of £297 million (approximately $484 million).
The court, as per Chinese laws, found that Glaxo had offered money and property to non-government personnel in order to obtain improper commercial gains. We remind investors that the investigations were initiated by China's Ministry of Public Security in Jun 2013.
Our Take
The fine of £297 million levied by the Chinese government represents more than 5% of Glaxo's second-quarter revenues. We believe this will have a negative impact on Glaxo's already dwindling top line. Glaxo intends to pay the fine from its existing funds.
Meanwhile, the company is taking a number of steps to address the issue including introducing changes in the incentive program for its sales force – separating sales targets from compensation and reducing and changing engagement activities with health care professionals significantly.
The company has also expanded processes for review and monitoring of invoicing and payments. Additional details related to the cost and charges related to restructuring will be announced along with the third quarter 2014 earnings update scheduled on Oct 22.
Glaxo carries a Zacks Rank #5 (Strong Sell).
Verizon Extends Voice Over LTE Services to iPhone 6
Leading wireless giant Verizon Communications (NYSE:VZ-Free Report) has reportedly activated Voice over LTE (VoLTE) service on iPhone 6 and iPhone 6 Plus. With this new feature, customers can now enjoy HD Voice, which offers improved audio quality, on the latest iPhone model.
We believe the addition of the VoLTE feature will be a bonus for the latest iPhone's users and can potentially be a key factor for driving sales. In addition, Verizon's offering will ensure a competitive edge against other iPhone6 providers like AT&T, Inc. (NYSE:T-Free Report), Sprint Corp. (NYSE:S-Free Report) and T-Mobile US, Inc. (NYSE:TMUS-Free Report).
Verizon is riding high on increased smartphone sales and the introduction of devices with advanced technology is likely to boost data revenues going forward. During the second quarter of 2014, the company's smartphone penetration increased to 75% driven by several device launches to lure customers to 4G LTE, which accounts for around 76% of the total data traffic.
The company ended the quarter with 63.5 million smartphone activations, of which 69% were 4G. With approximately 20 million 3G smartphones and over 22 million basic phones, the company expects a further expansion in its 4G smartphone base in 2014.
In addition, Verizon is focusing on enhancing its postpaid tablet base in 2014, which currently stands at over 4 million. Further, Verizon's planned VoLTE rollout is expected to boost its performance. The first series of handsets will be available by the end of 2014 and is expected to gradually reduce Verizon's reliance on CDMA chipsets, leading to lower device cost. Additionally, voice traffic on LTE will help the company in refarming its 3G spectrum to accommodate LTE and increase bandwidth.
Verizon currently has a Zacks Rank #3 (Hold).
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
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