Osiris Therapeutics, Williams Companies, AGL Resources, Nicor Inc. and NCI Building Systems

CHICAGO--([ BUSINESS WIRE ])--[ Zacks Equity Research ] highlights: Osiris Therapeutics (Nasdaq: [ OSIR ]) as the Bull of the Day and Williams Companies (NYSE: [ WMB ]) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on AGL Resources (NYSE: [ AGL ]), Nicor Inc. (NYSE: [ GAS ]) and NCI Building Systems Inc. (NYSE: [ NCS ]).

Full analysis of all these stocks is available at [ http://at.zacks.com/?id=2678 ].

Here is a synopsis of all five stocks:

[ Bull of the Day ]:

Osiris Therapeutics (Nasdaq: [ OSIR ]) reported third quarter earnings of $0.14 per share, well above the Zacks Consensus Estimate of a profit of $0.04 and the year-ago loss of $0.21. Results were mainly driven by lower operating expenses. Revenues of $10.8 million were just above the Zacks Consensus Estimate of $10 million.

Lead pipeline candidate Prochymal has the potential to be a sort of a wonder drug for various inflammatory or tissue damage indications. Prochymal could be a billion-dollar blockbuster product if all development goes well. Meanwhile, the sales opportunity for Chondrogen, the company's second pipeline candidate, could also be significant.

We view the company's collaboration agreement with large-cap biotech Genzyme as a positive. We believe the current share price represents an attractive entry point and maintain our Outperform rating on the stock. Based on third quarter results, we have increased our 2010 and 2011 earnings estimates.

[ Bear of the Day ]:

We are downgrading our rating on Williams Companies (NYSE: [ WMB ]) shares to Underperform from Neutral, following lower third quarter results. The company's exploration and production business unit posted a disappointing performance, reflecting management's decision to cut drilling amid the low price scenario.

Williams' exposure to volatility in natural gas and natural gas liquids prices also remain a key area of concern, in our view. In addition, the lack of takeaway capacity from the Rocky Mountains and the low reserve replace ratio will continue to hamper the company's revenue and earnings in the near term.

We expect Williams to perform below its peers and industry levels in the coming months. Our $21 price target reflects a 2010 P/E multiple of 18.8x, well within the company's historical trading range.

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AGL to Buy Nicor for 43.1 Billion

AGL Resources (NYSE: [ AGL ]) a" the owner of Atlantaa�s natural-gas utility a" has agreed to acquire natural gas distributor Nicor Inc. (NYSE: [ GAS ]) for about $3.1 billion in cash, stock and debt. The deal will create a big new natural gas distributor with about 4.5 million customers across seven states, annual revenues of $5.1 billion and an enterprise value of $8.6 billion.

As per the deal a" the largest among domestic gas utilities this year a" Nicor shareholders would get $21.20 in cash and 0.8382 shares of AGL common stock for each share they hold, representing a total value of $2.4 billion. At Nicora�s Mondaya�s closing stock price of $46.76, the deal values the Naperville, Illinois-based companya�s shares at $53 each, a 13% premium. Additionally, AGL will assume $700 million in debt.

The transaction, which is subject to regulatory and shareholder approvals, is expected to close in the second half of 2011. Following the closure, current stockholders of AGL will own approximately 67% of the combined company, with Nicor shareholders owning the rest.

Nicor Inc. is a holding company whose principal business is gas distribution. The companya�s largest subsidiary is Nicor Gas, a distributor of natural gas that provided almost 80% of the companya�s 2009 sales. Nicor also owns Tropical Shipping, a transporter of containerized freight serving the Bahamas and the Caribbean region.

NCI Building Suffers Loss in 2010

NCI Building Systems Inc. (NYSE: NCS) reported an adjusted loss of 72 cents per share in the fourth quarter fiscal 2010, a stark decline from earnings of $1.86 per share in the year-ago quarter. The loss per share was, however, a tad lower than the Zacks Consensus Estimate of a loss 77 cents.

For the third consecutive year, industry-wide demand was affected by weak economic conditions, and NCI Buildinga�s strongest markets a" commercial and industrial a" bore the brunt.

The adjusted loss per diluted share, however, excluded a non-cash beneficial conversion charge and other special charges. Including these charges, reported net loss per share was $1.01 versus a net loss per share of $17.66 in the year-ago quarter.

Guidance

NCI Building did not provide any specific earnings guidance for fiscal 2011. The company, however, stated that it witnessed a pick-up in quoting activity from the commercial/industrial sector of the market, which prior to the economic downturn had accounted for 70% of its business.

The commercial/industrial sector of AIA's (American Institute of Architects) Architectural Billing Index has been in positive territory for the sixth consecutive month, in October, thus suggesting an increase in construction activity in the next nine to twelve months on a year-over-year basis.

In fiscal 2011, the company intends to implement a number of measures that include the launch of new sales initiatives targeting specific markets, the rollout of new products and services, a system upgrade to further reduce order processing time, and implementation of logistics systems to reduce transportation costs and improve scheduling.

Our Take

The companya�s results have been affected by weak non-residential construction activity and rising steel prices. Added to these are extremely competitive market conditions in its Engineered Building Systems and Metal Components businesses that have intensified pricing pressure.

We do not expect any significant improvement in NCI Building Systems in the coming quarters, given the slowdown in bookings and the economic uncertainty. However, we believe the companya�s aggressive restructuring actions will help its return to profitability when industry conditions improve. The company currently has a Zacks #3 Rank (short-term Hold rating) on its stock.

Based in Houston, Texas, NCI Building manufactures and markets metal products primarily for the non-residential construction industry in North America. It competes with privately held American Buildings Company, Butler Manufacturing Company and Varco Pruden Buildings.

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

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Osiris Therapeutics, Williams Companies, AGL Resources, Nicor Inc. and NCI Building Systems