Health & Fitness
Health and Fitness
Health and Fitness
Mon, January 26, 2009 Zacks Bull & Bear of the Day Highlights: WellPoint, Logitech, Green Mountain Coffee, Peet's and Starbucks
CHICAGO--([ BUSINESS WIRE ])--Zacks Equity Research picks WellPoint Inc. (NYSE: [ WLP ]) as Bull of the Day and Logitech International S.A. (Nasdaq: [ LOGI ]) as Bear of the Day. In addition, the analysts at Zacks Equity Research discuss the latest on Green Mountain Coffee Roasters (Nasdaq: [ GMCR ]), Peet's Coffee & Tea (Nasdaq: [ PEET ]) and Starbucks Corp. (Nasdaq: [ SBUX ]).
Full analysis of all these stocks is available at: [ http://at.zacks.com/?id=2678 ]
Bull of the Day
WellPoint Inc. (NYSE: [ WLP ]) is the largest publicly traded commercial health benefits company, and the largest of the Blue Cross Blue Shield (BCBS) plan providers, in terms of membership in the US.
On January 28, 2009 WLP will report 4Q08 financial results. Our current revenue and EPS estimates are $15.56B and $1.14 respectively versus consensus estimates of $15.56B and $1.36.
Our Buy recommendation remains intact at current levels pending the 4Q08 earnings release. We have valued WLP on a forward price/earnings (P/E) basis, as well as a comparison to similar firms in the managed care sector. Our $55 price target is derived using a P/E multiple of 9.7x our FY09 EPS of $5.70.
Bear of the Day
Logitech International S.A. (Nasdaq: [ LOGI ]) is a leading manufacturer and marketer of interface products for personal computers (PCs) and other digital platforms. The company's products include: Internet video cameras, mice and trackballs, keyboards, audio and telephony products, interactive gaming devices, and 3D controllers.
LOGI reported results for the third quarter of 2009 with weaker-than-expected revenues and earnings due to weakening demand, lower gross margin and higher effective taxes. The company currently assumes that this relatively weak macroeconomic environment will weaken further in the coming months. Its outlook anticipates that the economy will have an impact on the European consumer as well.
It plans to reduce global salaried workforce by between 550 and 600 employees and this is expected to generate annual cost savings beginning in 2010 of approximately $50 million. We now estimate that revenue and EPS will reduce by 2.5% and 26.5% respectively in 2009 compared to 2008.
We have downgraded LOGI to a Sell with a target price of $10.00.
Recent Analysis from the Analyst Blog
Green Mountain Near Its Peak
Headquartered in Waterbury, Vermont, Green Mountain Coffee Roasters (Nasdaq: [ GMCR ]) is a provider of premium, specialty coffees through multiple wholesale distribution channels and also to the single-cup brewing industry. Green Mountain Coffee operates in a very competitive and fragmented market. The company competes against all sellers of specialty coffee, including Dunkin Donuts, New England Coffee, Peet's Coffee & Tea (Nasdaq: [ PEET ]), Starbucks Corp. (Nasdaq: [ SBUX ]), Seattle's Best and others.
Green Mountain Coffee Roasters is a growth company in the premium coffee and tea industry. Management is implementing a growth strategy based on a multi-channel geographic penetration business model. The company is expanding geographically and by adding new relationships.
Having generated 24 consecutive quarters of double-digit sales growth and twelve consecutive quarters with growth in excess of 25%, the stock is fairly valued at a premium P/E. The Hold rating is maintained due to high valuation and rising input costs.
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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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