CHICAGO, Oct. 24, 2011 /PRNewswire/ -- Zacks Equity Research highlights: Texas Capital Bancshares, Inc. (Nasdaq: TCBI) as the Bull of the Day and Grupo Televisa S.A. (NYSE: TV), as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Schlumberger Ltd. (NYSE: SLB), Halliburton Co. (NYSE: HAL) and LM Ericsson Telephone Company (Nasdaq: ERIC).
(Logo: http://photos.prnewswire.com/prnh/20101027/ZIRLOGO)
Full analysis of all these stocks is available at http://at.zacks.com/?id=2678.
Here is a synopsis of all five stocks:
Texas Capital Bancshares, Inc. (Nasdaq: TCBI) reported third-quarter 2011 operating earnings of $0.56 per share, which came well ahead of the Zacks Consensus Estimate of $0.50 per share. The results were also above the prior-year quarter's earnings of $0.25 per share. Quarterly results benefited from an increase in net interest income.
Texas Capital's net interest income stemmed from spiked average earnings assets. Net interest margin also increased year over year, driven by growth in loans and a reduction in funding costs. This was also supported by an improvement in loan spreads.
Credit metrics also improved during the quarter at Texas Capital. After reviewing the results, we are maintaining our Outperform recommendation on the shares.
We reaffirm our Underperform recommendation on Grupo Televisa S.A. (NYSE: TV) global depositary shares (GDS) ahead of its third quarter-2011 financial results. Televisa lost a significant amount of advertising revenue from businesses of Mexican telecom tycoon Carlos Slim. Intensifying competition in the Mexican pay-TV market has forced Televisa to spend more in order to retain and solidify its customer base.
As a result, depreciation and amortization expenses increased by leaps and bounds which significantly hurt the company's bottom line. Televisa is trying its best to enter into the lucrative wireless market of Mexico. Despite this, we remain concerned that the company may not get the necessary regulatory approvals.
We believe prolonged legal battles with Carlos Slim controlled entities will continue to affect the overall financials of Televisa in the rest of 2011. We do not find any near-term catalyst for the company to drive the stock price.
Latest Posts on the Zacks Analyst Blog:
Schlumberger Grows but Misses Ests
The world's largest oilfield services provider Schlumberger Ltd. (NYSE: SLB) has reported third-quarter 2011 earnings of 98 cents per share (excluding special items), missing the Zacks Consensus Estimate of $1.01. However, the quarter's results showed a steady improvement from the year-earlier profit of 70 cents per share.
Income from continuing operations, excluding charges, was $1.32 billion, up 51% year over year. The increase was aided by strong growth worldwide, including all product groups.
Revenue of $10.23 billion also missed the Zacks Consensus Estimate of $10.27 billion, but grew an impressive 49.4% growth over the year-earlier figure of $6.85 billion.
Outlook
Going forward, Schlumberger is hopeful of demand improvement in select North American basins, as operators continue to focus on investing in exploring unconventional resources.
The oilfield services behemoth believes that bullish near-term U.S. land drilling trends, with activity driven by horizontal drilling and liquids-rich plays, will be supported by high oil prices.
Our Recommendation
Schlumberger shares currently retain a Zacks #3 Rank, which translates into a short-term Hold rating. We are also maintaining our long-term Neutral recommendation on the stock.
We like Schlumberger's lead position in the global oilfield services market, along with its technologically complex product and service offerings as well as its robust financial profile. Moreover, we believe the company will benefit in the next several quarters from the continued shift in drilling activity to liquids from gas and the restructuring of its U.S. land operations.
Importantly, integration with Smith is acting as a positive catalyst for Schlumberger with cost and revenue synergies expected to be more than the company's expectation for the year. The Schlumberger-Smith drilling technique combination is boosting the company's customers drilling results. It was also accretive to earnings per share in the quarter.
The company's competitor, Halliburton Co. (NYSE: HAL), the second-largest member of the oilfield services contingent, reported better-than-anticipated third quarter earnings, helped by the strength and sustainability of the all-important North American onshore activity levels.
However, Schlumberger's financial and operational performances face a number of headwinds, including changes in exploration and production spending patterns, commodity price fluctuations, geopolitical risks, regional spending trends, competition, new technology and changes in economic conditions. Additionally, foreign currency fluctuation is also a threat to the company's profitability.
As such, we see the stock performing in line with the broader market and prefer to remain on the sidelines.
Ericsson Beats Estimates
LM Ericsson Telephone Company (Nasdaq: ERIC) reported results for the third quarter of 2011, with a net income of SEK 3.8 billion ($575.8 billion) compared to net income of SEK 3.6 billion in the prior-year quarter.
Ericsson reported earnings of 22 cents a share which was two cents above the Zacks Consensus Estimate.
Revenues in the quarter were up 17% on a year-over-year basis to SEK 55.5 billion ($63.9 billion) and were up 1% sequentially. Comparable sales after adjusting for currency effects increased 24% compared to the prior-year quarter. Revenues were primarily driven by the strong growth in mobile broadband equipment and growth in the services segment.
Our Take
There is continued growth in mobile subscriptions, although the current growth rate is lower than in the prior year. Traffic in mobile networks is accelerating, which creates need for new and expanded mobile networks and corresponding professional services. Data traffic, as part of operator revenues, continues to increase.
Although the credit environment is still tight in several emerging markets, there is good development in other markets, including the world's leading economies such as China, India, the US and Japan.
The company is going ahead with its cost reduction program and expects a smooth transition to IP technologies. We currently maintain a Neutral rating on Ericsson on long term basis (3-6 months). Short term (1-3 months) the company has a Zacks #3 Rank, which implies a Hold rating.
Get the full analysis of all these stocks by going to http://at.zacks.com/?id=2649.
About the Bull and Bear of the Day
Every day, the analysts at Zacks Equity Research select two stocks that are likely to outperform (Bull) or underperform (Bear) the markets over the next 3-6 months.
About the Analyst Blog
Updated throughout every trading day, the Analyst Blog provides analysis from Zacks Equity Research about the latest news and events impacting stocks and the financial markets.
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 analyst 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 by visiting http://at.zacks.com/?id=7158.
About Zacks
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leonard 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=4582.
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