CHICAGO, July 10, 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 Progressive Corp. (NYSE:PGR-Free Report), W.R. Berkley Corporation (NYSE:WRB-Free Report), Cigna Corp. (NYSE:CI-Free Report), Maiden Holdings, Ltd. (Nasdaq:MHLD-Free Report) and Energizer Holdings Inc (NYSE:ENR-Free Report).
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Here are highlights from Tuesday's Analyst Blog:
Progressive Earnings to Beat Again?
We expect auto insurer Progressive Corp. (NYSE:PGR-Free Report) to beat expectations when it reports second-quarter 2013 results on Jul 11.
Why a Likely Positive Surprise?
Our proven model shows that Progressive is likely to beat earnings because it has the right combination of two key ingredients.
Positive Zacks ESP: Expected Surprise Prediction or ESP (Read: Zacks Earnings ESP: A Better Method), which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is at +2.50%. This is very meaningful and a leading indicator of a likely positive earnings surprise for shares.
Zacks Rank #2 (Buy):
Progressive carries a Zacks Rank #2 (Buy). Note that stocks with Zacks Ranks of #1, #2 and #3 have a significantly higher chance of beating earnings. The sell rated stocks (#4 and #5) should never be considered going into an earnings announcement.
The combination of Progressive's Zacks Rank #2 (Buy) and +2.50% ESP makes us very confident in looking for a positive earnings beat on Jul 11.
What is Driving the Better Than Expected Earnings?
42 centsThe company was successful in reducing costs as well. Although total expense in April grew 5% year over year, the same declined 14% in May.
Progressive's operating earnings and premiums' growth as well as debt-to-total capital ratio in the last two months of this year reflect an overall constant improvement. Current policies in force also remained healthy. Progressive remains focused on maintaining a healthy policy life expectancy, which is a significant measure to retain customers.
Other Stocks to Consider
W.R. Berkley Corporation-
): Earnings ESP of +1.47% and a Zacks Rank #1 (Strong Buy).
Cigna Corp. (NYSE:CI-Free Report): Earnings ESP of +2.52% and a Zacks Rank #1 (Strong Buy).
Maiden Holdings, Ltd
-
): Earnings ESP of +3.70% and a Zacks Rank #2 (Buy).
Energizer Upped to Strong Buy
Zacks Investment Research upgraded Energizer Holdings Inc (NYSE:ENR-Free Report) to a Zacks Rank #1 (Strong Buy). With a strong return of 37.1% over the past one year and a positive estimate revision trend, Energizer is an attractive investment opportunity.
Why the Upgrade?
Strong second quarter results, innovative product pipeline, stringent cost control and the positive effects of the ongoing restructuring activity contributed to the upgrade.
Energizer reported second quarter results on May 1, 2013. Earnings of $1.80 per share jumped 47.5% from the year-ago quarter and comfortably surpassed the Zacks Consensus Estimate by 51 cents. This was the third consecutive quarter of positive earnings surprise with an average beat of 11.1%.
Based on the strong results, Energizer reiterated its fiscal 2013 earnings guidance in the range of $6.75 to $7.00 per share. The company expects earnings in the range of $2.75 to $3.00 in the second half of 2013 compared with $2.94 per share earned during the year-ago period
Although Energizer forecasts advertising expenses to increase in the latter half of 2013, restructuring savings are expected to increase at a much faster rate during the period. Energizer upped its restructuring outlook for fiscal 2013 to $50.0-$60.0 million from its earlier estimate of $25.0-$35.0 million.
As a result, gross savings from the restructuring project is expected to increase an additional $25.0 million to $225.0 million, of which $150.0 million is expected to be used for improving profitability, going forward.
The Zacks Consensus Estimate for fiscal 2013 increased 1.3% (9 cents) to $6.93 per share over the last 90 days. The current estimate is within the guidance range provided by Energizer. For fiscal 2014, the Zacks Consensus Estimate increased 0.5% (4 cents) to $7.61 per share over the same period.
The long-term expected earnings growth rate for Energizer is 11.0%.
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