Health & Fitness
Health and Fitness
Health and Fitness 
Mon, January 5, 2009
Zacks Bull & Bear of the Day Highlights: Isis Pharmaceuticals, LeapFrog, Johnson & Johnson, Exxon Mobil and iPass
CHICAGO--([ BUSINESS WIRE ])--Zacks Equity Research picks Isis Pharmaceuticals, Inc. (Nasdaq: [ ISIS ]) as Bull of the Day and LeapFrog Enterprises (NYSE: [ LF ]) as Bear of the Day. In addition, the analysts at Zacks Equity Research discuss the latest on Johnson & Johnson (NYSE: [ JNJ ]), Exxon-Mobil (NYSE: [ XOM ]) and iPass Inc. (Nasdaq: [ IPAS ]).
Full analysis of all these stocks is available at: [ http://at.zacks.com/?id=2678 ]
Bull of the Day
Isis Pharmaceuticals, Inc. (Nasdaq: [ ISIS ]) is a drug discovery and development company focused on the therapeutic target RNA and developing products from RNA-based technologies, such as "antisense." We believe that antisense technology represents an exciting and potentially revolutionary platform for developing therapeutic candidates to treat a wide margin of diseases.
The company's leading candidates are mipomersen for high cholesterol and ISIS-113715 for diabetes, along with several other proprietary and partnered programs for oncology, inflammatory disease, asthma, and viral infections. Our financial model forecasts sustained profitability in 2011.
We are reiterating or rating on Isis Pharmaceuticals of a Buy and maintaining our price target of $22.
Bear of the Day
Headquartered in California, LeapFrog Enterprises (NYSE: [ LF ]) is a leading provider of technology-based learning products and proprietary content. The company designs and develops educational products, as well as related interactive software and content, under multiple product platforms, including the LeapFrog, LeapPad, Leapster, and Quantum Leap brands.
Management's actions to improve long-term operating results through increased R&D and incremental marketing spending resulted in another year of negative earnings in 2007. Management expects that 2008 will be a turnaround year with new products introduced in the last two years generating sales and earnings growth.
However, turnarounds usually take longer than initial expectations. In addition, the economic weakness in the U.S. is negatively impacting spending on discretionary products and is currently a headwind for the company's progress. Therefore, the stock is rated a Sell.
Recent Analysis from the Analyst Blog
Indexes Point to Bleakness
There is nothing in this report that would cause the market to be up the way that it is today. That may, after all, be the best news there is. The market has started to ignore all bad news, which is often a healthy development.
On the other hand, it could just mean that the market is being overly optimistic. CNBC came out with a survey this morning of money managers, and 26% of them expect the market to be up over 20% in 2009, while only 6% expect the market to be down in 2009. This is EXTREMELY disturbing news, as an overwhelming consensus of money managers is almost ALWAYS WRONG.
The economy is going to be very ugly in 2009, and I would advise sticking to firms with products that people need, not want, and which have fortress balance sheets. A solid dividend yield that is well covered, even by the low estimate of 2009 earnings, is also a plus. Two examples of such companies would be Johnson & Johnson (NYSE: [ JNJ ]) and Exxon-Mobil (NYSE: [ XOM ]).
iPass Results Expected In-Line
We believe iPass Inc. (Nasdaq: [ IPAS ]) is close to creating a marginally profitable business with its subscription-based model for enterprise connectivity. We expect iPass to benefit from increased bookings.
However, the true investment case for the stock is the company's broadband and 3G software and services offering. This could serve to differentiate iPass from traditional network access and drive meaningful margin improvement into 2009 as well as 2010.
In the meantime, iPass is hitting its targets and meeting expectations. But we continue to expect the fourth quarter to be flat equentially and believe the company will report in-line 2008 results.
Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: [ 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.
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