(FRK) - Earnings per share totaled 86 cents. The result exceeded the consensus estimate of 62 cents

Florida Rock Industries, Inc. (FRK) remains a Zacks #1 Rank (Strong Buy) company and maintains its history of exceeding analysts' earnings estimates. Earnings per share topped the consensus forecasts over the past five consecutive quarters and have grown 22% over the past five years. FRK's fiscal second-quarter earnings per share result exceeded Wall Street expectations and beat the year-ago total. Full Analysis Florida Rock Industries, Inc. produces construction materials, concentrating its operations in the Southeastern and Mid-Atlantic states. The company operates in three segments: construction aggregates, concrete products and cement and calcium products. During the past five straight quarters, FRK delivered earnings per share that have been ahead of analysts' expectations by an average margin of 15.82%. Earnings per share have grown 22% over the past five years and are forecasted to grow at 15% over the next 3-5 years. Florida Rock Industries, Inc., a Zacks #1 Rank (Strong Buy) company, reported fiscal second-quarter financial result on April 25, 2006. Earnings per share totaled 86 cents. The result exceeded the consensus estimate of 62 cents and outperformed the previous year's second quarter. Consolidated total sales increased 39.7% year-over-year. The company noted that this increase was driven by volume increases and improved pricing in all three segments. President and CEO John Baker stated that the second quarter results benefited from improved weather, pricing and demand in substantially all of the company's markets. FRK mentioned that its outlook remains quite positive. Analysts' estimates remain positive as well. Earnings forecasts for the upcoming quarter and for fiscal 2006 have been on the rise. The current consensus estimate for third-quarter fiscal 2006 earnings of 91 cents per share is 10% higher than 90 days ago. Estimates for fiscal 2006 profits have been upped 11% over the same time period. In early May, the company's Board of Directors approved a quarterly dividend of 15 cents per share. The company's current dividend yield is at approximately 1% and it offers a five-year average dividend yield of 1.27%. The stock trades at a valuation of 29.66x trailing 12-month earnings and at 14.8x its current fiscal year estimated earnings. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. The ranks are updated every Monday morning on Zacks.com. As such, it is prudent to check the site for the latest Zacks Rank on the stocks highlighted in this section. Simply click the link for the stock or enter the symbol in the ticker entry box in the upper left hand corner of the web site. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. Blog Home

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(TSH) - Teche Holding Company - uptrend accelerated as TSH set new highs on heavy volume

Full Analysis Teche Holding is expected to report earnings for the quarter ended June 2006 on Jul 27. Analysts' consensus estimates for the quarter include EPS of 73 cents, up 12.3% from the same quarter last year. The company also regularly raises its quarterly dividend. In fact, the company announced its thirteenth consecutive quarterly dividend increase last month. Technical Analysis TSH has been in a sustained uptrend since March 2000 with only a moderate decline in the aftermath of Hurricane Katrina. On Wednesday, the uptrend accelerated as TSH set new highs on heavy volume, closing up more than 2% for the day. Teche is comfortably above its 200-day moving average, and that average itself is demonstrating a very positive slope to the upside, indicating that the long-term trend for TSH remains higher. TSH, as the chart shows, is not a flashy company. They just make money and pass it on to their shareholders in the form of dividend increases. Obviously the market has responded favorably to this strategy. This is an excellent example of the Momentum trader's credo, 'Buying good stocks with improving fortunes at the same time that the market is rewarding those improvements'. Background Teche Holding Company operates as the holding company for Teche Federal Bank, which offers various financial services in Louisiana. The bank primarily generates deposits and originates various loans. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. The ranks are updated every Monday morning on Zacks.com. As such, it is prudent to check the site for the latest Zacks Rank on the stocks highlighted in this section. Simply click the link for the stock or enter the symbol in the ticker entry box in the upper left hand corner of the web site. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. Blog Home

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(PDII) - Earnings estimates have taken a dramatic upward leap over the past 60 days

PDI, Inc. (PDII) has experienced a dramatic increase in earnings estimates over the past 60 days. Analysts had forecasted a loss of 11 cents per share back then, but now predict a profit of 62 cents per share. Similarly, next years estimates skyrocketed from four cents to 35 cents over the past two months. Clearly, last quarter's 1900% earnings surprise accounted for the huge increase in earnings estimates. Full Analysis PDI, Inc. is a diversified sales and marketing services provider to the biopharmaceutical industry offering a comprehensive set of outsourced solutions for established and emerging pharmaceutical companies. PDI is dedicated to maximizing the return on investment for its clients by providing strategic flexibility; sales, marketing, and commercialization expertise; and a philosophy of performance. The company recently announced a new contract sales engagement with a major drug company. The contract, effective immediately, is expected to produce approximately $23 to $25 million in revenue for 2006 and approximately $35 to $40 million in revenue over its one-year term. PDII reported a strong first quarter. Gross profit for the quarter ended March 31, 2006 increased to $19.1 million (24.2% of revenue), 5.8% more than gross profit of $18.0 million (22.0% of revenue), for the quarter ended March 31, 2005. Net income per share was 40 cents for the quarter ended March 31, 2006 versus a break-even result for the quarter ended March 31, 2005. Mr. Larry Ellberger, PDI's interim CEO commented, "We are very pleased with our performance in the first quarter. Our people delivered solid results in each of our businesses and did a great job in managing expenses. PDI's business development teams are generating leads for future revenue growth in all of our business units. Our Performance Sales Teams business announced two new business wins in the first quarter with emerging pharmaceutical companies and we are continuing with our aggressive business development efforts targeted to this important segment of our market. Our balance sheet remains strong as we generated almost $5 million in cash flow from operations and ended the quarter with over $102 million in cash and short term investments." Earnings estimates have taken a dramatic upward leap over the past 60 days. Analysts had forecasted a loss of 11 cents per share back then, but now predict a profit of 62 cents per share. Similarly, next years estimates skyrocketed from four cents to 35 cents over the past two months. Clearly, last quarter's 1900% earnings surprise accounted for the dramatic increase in earnings estimates. The stock is currently trading at 23.4x this year's earnings estimates of 62 cents per share, slightly above the long-term growth rate of 20%, giving the stock a PEG ratio of 1.17. On a price-to-book basis, the stock is cheap, trading at 1.4x book value, well below the 3.9x of the S&P 500. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. The ranks are updated every Monday morning on Zacks.com. As such, it is prudent to check the site for the latest Zacks Rank on the stocks highlighted in this section. Simply click the link for the stock or enter the symbol in the ticker entry box in the upper left hand corner of the web site. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. Blog Home

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(PBR) - Petrobras S.A. - size and reach of its operations make it a quasi-monopoly

Petrobras S.A. (PBR) has been experiencing increasing earnings estimates. Over the past 60 days, this year's estimates have increased 7.4%, while next year's have jumped 4.6%. Two analysts raised their numbers for this year. The stock is quite cheap at 7.4x this year's estimates of $11.49 per share, well below the company's long-term growth rate of 11.10%. The stock sports a price-to-book ratio of 2.6, in-line with the industry and a third less than the S&P 500. Full Analysis Petrobras S.A., is Brazil's national oil company and the major Latin American integrated oil company. The Brazilian government owns approximately 32% of Petrobras' common stock and 56% of its voting stock. The company's American depository receipts represent 23% of voting shares and approximately 27% of total equity. PBR operates in the following segments: Exploration and Production, Supply, Distribution, Natural Gas and Power, and International. Petrobras is the largest publicly traded Latin American oil company and dominates Brazil's oil and gas sector. It produces substantially all of Brazil's crude oil and natural gas, accounts for almost all of the country's refining capacity, is building the country's natural gas infrastructure, and enjoys strong market share positions in the petroleum product and liquefied petroleum gas (LPG) marketing businesses. While the company no longer operates as a legal monopoly, the size and reach of its operations make it a quasi-monopoly in Brazil. The company is also a major player in the Argentine oil and gas sector, having acquired that country's second largest oil player last year, and is also the biggest international investor in Bolivia. The company's dominant position in Brazil and its extensive deepwater expertise make it a preferred partner for the global oil majors entering Brazil's upstream sector. In fact, the company has been able to successfully leverage its Brazilian deepwater expertise into exploring upstream opportunities abroad. The company has a growing presence in the U.S. Gulf of Mexico (GoM) and offshore West Africa. Recently Petrobras signed an agreement to start to search for offshore oil in Portugal. Petrobras compares favorably with its peers from other emerging markets, in terms of size, costs, and growth prospects. Earnings estimates have been on the rise for Petrobras. Over the past 60 days, this year's estimates have increased 7.4%, while next year's have jumped 4.6%. Two analysts raised their numbers for this year. The stock is quite cheap at 7.4x this year's estimates of $11.49 per share, well below the company's long-term growth rate of 11.10%. The stock sports a price-to-book ratio of 2.6, in-line with the industry and a third less than the S&P 500. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. The ranks are updated every Monday morning on Zacks.com. As such, it is prudent to check the site for the latest Zacks Rank on the stocks highlighted in this section. Simply click the link for the stock or enter the symbol in the ticker entry box in the upper left hand corner of the web site. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. Blog Home

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(NEM) - Over the past 90 days, this year's estimates have increased 41.6%, while next year's numbers have jumped 48.4%

Newmont Mining Corporation (NEM) is riding the wave of soaring gold prices. Over the past 90 days, this year's estimates have increased 41.6%, while next year's numbers have jumped 48.4%. The company has exceeded estimates for four consecutive quarters, two of which were by more than 10%. Despite a strong run, the stock is attractively valued at 20.7x next year's estimates, slightly below the long-term growth rate of 22%, giving the stock a PEG ratio of 0.94. Full Analysis Newmont Mining Corporation primarily engages in the exploration for and production of gold. The company has mining operations in the United States, Australia, Peru, Indonesia, Ghana, Canada, Uzbekistan, Bolivia, New Zealand, and Mexico. Newmont also engages in the production of copper in Indonesia. The company also owns royalty interests at the Goldstrike properties located on the Carlin Trend in northern Nevada; on a portion of the Stillwater mine and the East Boulder mine, both located near Nye, Montana; and on 1.8 million gross acres of producing and nonproducing lands located in western Canada and the Canadian Arctic. First-quarter earnings shot up as a result of soaring gold prices. Earnings of 37 cents per share bested estimates by almost 6% and was more than triple last year's results. The company also reported revenue of $1.15 billion for the quarter, up from $945 million during Q1 2005. Wayne Murdy, Newmont's chairman and CEO, said in a statement, "Our first quarter's results reflect strong margin and earnings per share growth from a higher realized gold price of $555 per ounce and our continued focus on cost containment. With the current gold price in excess of $600 per ounce, we expect to deliver expanding gold margins for our shareholders." As one would expect, earnings estimates have been soaring for NEM. Over the past 90 days, this year's estimates have increased 41.6%, while next year's numbers have jumped 48.4%. The company has exceeded estimates for four consecutive quarters, two of which were by more than 10%. Despite a strong run, the stock is attractively valued at 20.7x next year's estimates, slightly below the long-term growth rate of 22%, giving the stock a PEG ratio of 0.94. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. The ranks are updated every Monday morning on Zacks.com. As such, it is prudent to check the site for the latest Zacks Rank on the stocks highlighted in this section. Simply click the link for the stock or enter the symbol in the ticker entry box in the upper left hand corner of the web site. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. Blog Home

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(EXP) - earnings increase is primarily attributable to volume growth and strong pricing

Eagle Materials, Inc. (EXP) recently upped its earnings guidance for the fiscal first quarter and fiscal 2007. The company will announce first quarter results on July 24, 2006. Fiscal fourth-quarter earnings of 86 cents per share surpassed last year's 49 cents and eclipsed the consensus estimate by nearly 18%. Full Analysis Eagle Materials Inc. manufactures and sells basic building materials used primarily in commercial and residential construction, and public construction projects in the United States. The company's businesses are separated into four segments: gypsum wallboard, cement, recycled paperboard and concrete and aggregates. EXP, which has topped analysts' expectations over the past five consecutive quarters, recently raised its earnings guidance for the fiscal first quarter and fiscal 2007. First-quarter projections advanced from a range of $1.00 to $1.10 per share to the current forecast of $1.10 to $1.20. The new annual guidance moved up to a range of $4.40 to $4.70 per share. Previously the company's fiscal 2007 expectations ranged between $3.67 and $4.00. EXP noted that the earnings increase is primarily attributable to volume growth and strong pricing in its wallboard and cement operations. First quarter results will be available on July 24, 2006. Wall Street estimates have been increasing as well. Current first-quarter earnings expectations of $1.10 per share are five cents above the two-months ago level. Current fiscal 2007 estimates of $4.40 per share climbed 15 cents over the past 60 trading days. Earnings per share are forecasted to grow 34.5% over the next 3-5 years. On May 2, 2006, Eagle Material Inc. reported the highest annual and quarterly operating earnings in its history. Fiscal fourth-quarter earnings per share were 86 cents. The result surpassed last year's 49 cents and eclipsed the consensus estimate by nearly 18%. For the fiscal year, earnings were $3.02 per share versus the year-prior total of $1.91. The company stated that it remains well positioned to continue to achieve outstanding financial results given its low cost operations which supply building materials to a strong construction industry. EXP is trading at 9.78x current fiscal year estimated earnings. The company has a current dividend yield of 1% and a five-year average dividend yield of 0.86%. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. The ranks are updated every Monday morning on Zacks.com. As such, it is prudent to check the site for the latest Zacks Rank on the stocks highlighted in this section. Simply click the link for the stock or enter the symbol in the ticker entry box in the upper left hand corner of the web site. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. Blog Home

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(BGC) - General Cable - falling from its early May highs, it never traded below its 200-day moving average

Full Analysis General Cable is one of our favorite stocks; and not only because it's up over 57% since it was first selected as a Zacks Momentum stock of the day on Dec 14, 2005. This is a well run company that has delivered a positive earnings surprise in 12 of the last 13 quarters, including the last five straight. So clearly this is a company run by management who understands what Wall Street wants. BGC last reported earnings on May 1 for the March 2006 quarter, delivering a 52% positive earnings surprise, so it will be some time before we get another report. Technical Review BGC had been in a straight uptrend since it was featured in December 2005. The stock accelerated after the earnings surprise, setting a high for the move on May 5 at $38.14. After falling back a bit, the stock tried to test the old highs, but ran out of steam at $37.05 on Jun 2. Like most stocks, BGC was pressured downward by the very weak general market in early June, bottoming out at $26.10 on Jun 14. Since that time, the stock has been recovering, closing at $31.07 on Tuesday. While it is the dream of every investor to buy a stock that goes up every day, that's not realistic. Stocks trade in ebbs and flows and it is left to the trader to determine if a stock is changing direction or merely resting before its next upmove. One way of determining the characteristics of a break is to look at the longer term moving averages. The 200-day moving average, while not a trading system in and of itself, is a powerful indicator of the underlying trend. It is interesting to note that while BGC was falling from its early May highs, it never traded below its 200-day moving average. More importantly, the 200-day moving average itself continues to display a positive slope, an indication that the basic trend of the stock remains up Background General Cable Corp. is a leader in the development, design, manufacture, marketing and distribution of copper, aluminum and fiber optic wire and cable products for the communications, energy and electrical markets. The company sells its products primarily to commercial, industrial, utility, telecommunications, original equipment manufacturers, military/government, retail, electrical, and communications distributor customers worldwide. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. The ranks are updated every Monday morning on Zacks.com. As such, it is prudent to check the site for the latest Zacks Rank on the stocks highlighted in this section. Simply click the link for the stock or enter the symbol in the ticker entry box in the upper left hand corner of the web site. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. Blog Home

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(SPSX) - company reported stellar results for the first quarter of 2006

Superior Essex, Inc. (SPSX) is a cheap stock with increasing earnings estimates. Over the past 60 days, this year's estimates have risen 18.4%, while next year's have increased 9.7%. The company has exceeded earnings estimates in four out of the past six quarters, with one of those quarters posting a 137% surprise. The stock is attractively valued at 11.7x next year's estimates and a price-to-book ratio of 2.1, both below the industry averages and the S&P 500. Full Analysis Superior Essex, Inc., together with its subsidiaries, engages in the manufacture and supply of communications wire and cable products, and magnet wire and fabricated insulation materials. It operates in four segments: Communications Cable, North American Magnet Wire and Distribution, European Magnet Wire and Distribution, and Copper Rod. The company reported stellar results for the first quarter of 2006. For the quarter, Superior Essex reported revenues of $652 million and earnings of 54 cents per share, 46% ahead of the consensus. These results compare to revenues of $403 million and earnings per share of 34 cents in the first quarter of 2005. "Superior Essex once again posted significant revenue gains in the first quarter of 2006" said Stephen M. Carter, chief executive officer of Superior Essex. "Revenue growth in the first quarter benefited from our October 2005 Essex Nexans acquisition, as well as from continued revenue expansion in both of our North American Core Business segments. Year over year, we also generated a 40% increase in adjusted EBITDA and a 59% increase in adjusted earnings, thanks to profit accretion from our European joint venture and strengthening profitability in our Communications business." SPSX recently offered 2.7 million shares of its common stock in an underwritten public offering. Superior Essex plans to use the net proceeds from the offering to reduce debt under its senior secured revolving credit facility, to fund working capital needs and for other general corporate purposes. Despite some slight dilution, the improved balance sheet is a boon and the extra working capital could be used to finance growth projects. Earnings estimates have been on the rise for 2006 and 2007. Over the past 60 days, this year's estimates have risen 18.4%, while next year's have increased 9.7%. The company has exceeded earnings estimates in four out of the past six quarters, with one of those quarters posting a 137% surprise. The stock is attractively valued at 11.7x next year's estimates and a price-to-book ratio of 2.1, both below the industry averages and the S&P 500. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. The ranks are updated every Monday morning on Zacks.com. As such, it is prudent to check the site for the latest Zacks Rank on the stocks highlighted in this section. Simply click the link for the stock or enter the symbol in the ticker entry box in the upper left hand corner of the web site. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. Blog Home

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(MEOH) - the company announced a 14% dividend increase from 11 cents per share to 12.5 cents per share

Methanex Corporation (MEOH) exceeded earnings estimates in three out of the past four quarters, with one of the quarters surprising by 50%. Two analysts raised their numbers for both 2006 and 2007. This year's estimates increased 12% to $2.80 per share over the past 90 days, while 2007 estimates rose an impressive 24% over the same time frame. Full Analysis Methanex Corporation engages in the production, marketing, supply, and distribution of methanol. It owns and operates methanol production facilities, as well as sources methanol produced by others. The company serves chemical and petrochemical producers in North America, Asia Pacific, and Europe, as well as in Latin America. In early May, the company announced a 14% dividend increase from 11 cents per share to 12.5 cents per share, a sure sign of management confidence in the company's future earnings stream. Bruce Aitken, President and CEO of Methanex, commented, "We are pleased to have been able to increase our dividend for the fourth year in a row since its inception in 2002. This increase in our regular dividend reflects our continued confidence in the strength of our business and our outstanding portfolio of low cost assets." Further evidence of business strength was found in the company's first-quarter earnings report. Earnings per share came in at 79 cents, better than the consensus estimate by 5% and well above last year's 63 cents per share. Bruce Aitken, President and CEO of Methanex, commented, "Our large scale, low cost plants operated well in an environment of strong methanol prices in the first quarter of 2006 and this resulted in an outstanding quarter of earnings for our Company. Continued strong demand and industry unplanned outages caused supply to remain very tight and pushed our average posted methanol price up by US$34 per tonne since the fourth quarter of 2005. Our average realized price for the first quarter of 2006 was US$283 per tonne compared with US$256 per tonne for the previous quarter." The company is generating cash at an impressive rate. Mr. Aitken concluded, "Our cash generation was very strong this quarter. With US$93 million cash on hand at the end of the first quarter, a strong balance sheet and a US$250 million undrawn credit facility, we have the financial capacity to complete our capital maintenance spending program, pursue new opportunities to enhance our leadership position in the methanol industry and continue to deliver on our commitment to return excess cash to shareholders." MEOH exceeded earnings estimates in three out of the past four quarters, with one of the quarters surprising by 50%. Two analysts raised their numbers for both 2006 and 2007. This year's estimates increased 12% to $2.80 per share over the past 90 days, while 2007 estimates rose an impressive 24% over the same time frame. The stock is attractively valued at 7.5x this year's earnings and a price-to-book ratio of 2.5, below the 3.9 level of the S&P 500. MEOH also sports a return-on-equity of 24%, much better than the industry average of 16%. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. The ranks are updated every Monday morning on Zacks.com. As such, it is prudent to check the site for the latest Zacks Rank on the stocks highlighted in this section. Simply click the link for the stock or enter the symbol in the ticker entry box in the upper left hand corner of the web site. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. Blog Home

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(PBTC) - Peoples Banctrust - broke out in a big way on Monday, gaining over 9%

Full Analysis On Apr 18, PBTC reported first quarter EPS of 42 cents, a 38% improvement over the same quarter last year. PBTC is expected to report results for the June 2006 quarter on Jul 24. The consensus estimate is for EPS of 33 cents, an 18% improvement over the same quarter last year. PBTC broke out in a big way on Monday, gaining over 9%. Volume was more than twice normal. The stock has been in a gentle uptrend since the first quarter of 2001, but the velocity turned up significantly Monday. The stock isn't heavily followed, which increases the possibility of a positive earnings surprise when the company announces next month. As can be seen on the chart, PBTC gapped higher Monday and closed strong on no news. It's also interesting to note purchases of stock by the president and a director of PBTC in the first quarter of 2006. There is significant support below the current price at $20 and again at $19. Given the long-term uptrend, the breakout to the upside on Monday, the increase in volume and the insider purchases, this stock has a lot going for itself right now. Background Peoples Banctrust Co., Inc. is a bank holding company engaged in the general commercial and full-service retail banking business. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. The ranks are updated every Monday morning on Zacks.com. As such, it is prudent to check the site for the latest Zacks Rank on the stocks highlighted in this section. Simply click the link for the stock or enter the symbol in the ticker entry box in the upper left hand corner of the web site. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. Blog Home

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(CMI) - Analysts have been bullish on earnings estimates for the next quarter and the full year

Cummins, Inc. (CMI) posted first-quarter earnings per share that exceeded the previous year and topped the consensus estimate. The company stated that it expects 2006 to be better than the record-setting performance of 2005. Analysts have been bullish on earnings estimates, issuing upward revisions for the next quarter and the full year. CMI is currently yielding 1.35% and has a five-year average dividend yield of 2.96%. Full Analysis Cummins, Inc. designs, manufactures, distributes and services engines and related technologies, including fuel systems, controls, air handling, filtration, emission solutions and electrical power generation systems. The company operates in three segments: engine, power generation and components. During an annual meeting in early May, Cummins' Chairman and Chief Executive Officer Tim Solso told shareholders that strong growth in all markets should make 2006 an even better year than 2005 when the company had a record-setting performance. Thus far, CMI is delivering the outperformance. First-quarter earnings, which were released on Apr 28, 2006, were $2.70 cents per share, improving on last year's $1.96. The result also topped the consensus estimate by a penny. Revenues increased from $2.21 billion to $2.68 billion year-over-year. Tim Solso mentioned that the first-quarter performance reflects considerable strength along the breadth of the company's product line and in markets around the world. The company raised its full-year 2006 earnings per share guidance to a range of $12.40 to $12.60 per share, versus its previous outlook of between $11.90 and $12.10 per share. CMI forecasts profits between $3.35 and $3.45 per share in the second quarter. Analysts have been bullish on earnings estimates for the next quarter and the full year. Current second-quarter consensus projections of $3.63 per share are 33 cents above the levels of two months ago. Estimates for 2006 moved up $1.12 over the past 60 trading days to a current level of $14.06 per share. Cummins has experienced earnings per share growth of 35.19% over the past five years, while projected growth over the next 3-5 years currently stands at 17%. CMI sports a current dividend yield of 1.35% and a five-year average dividend yield of 2.96%. The company's return on equity is impressive at 32%, which is in line with the industry average. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. The ranks are updated every Monday morning on Zacks.com. As such, it is prudent to check the site for the latest Zacks Rank on the stocks highlighted in this section. Simply click the link for the stock or enter the symbol in the ticker entry box in the upper left hand corner of the web site. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. Blog Home

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(LHCG) - operates long-term acute care hospitals that provide services primarily to patients who have transitioned out of an intensive care unit

LHC Group, Inc. (LHCG) is experiencing increasing earnings estimates. Expectations for 2007 are up 7.1% to $1.21 per share over the past 60 days. The company has posted an average earnings surprise of 25% over the past two quarters, with two analysts raising their numbers for 2006 and 2007. The stock is currently trading at 17.1x next year's estimates, below the long-term growth rate of 20%, giving the stock a PEG ratio of 0.86. Full Analysis LHC Group, Inc. provides post-acute healthcare services primarily to Medicare beneficiaries in rural markets in the southern United States. It offers various home-based services, primarily through home nursing agencies and hospices, and facility-based services through long-term acute care hospitals and outpatient rehabilitation clinics. These home nursing locations offer a range of services, including skilled nursing, physical, occupational, and speech therapy and medically-oriented social services. The company also operates long-term acute care hospitals that provide services primarily to patients who have transitioned out of a hospital intensive care unit with complex medical conditions. It provides these outpatient rehabilitation services through physical therapists, occupational therapists, and speech pathologists, as well as outpatient rehabilitation services on a contract basis. In early May, the company reported impressive first-quarter results. Net service revenue for the three months ended Mar 31, 2006 increased 27.8% to $45.5 million, as compared to $35.6 million in 2005. For the three months ended Mar 31, 2006 and 2005, 84.9% and 82.8%, respectively, of the company's net service revenue was derived from Medicare. Earnings per share came in at 29 cents, a full 45% better than the consensus estimate. Keith G. Myers, President and Chief Executive Officer of LHC Group, said, "I am very proud of the progress that LHC Group has made this quarter. Our staff's commitment to quality care and service has resulted in continued growth. Our business strategy continues to focus on expanding our home health care operations through organic development as well as acquisition. As part of that strategy, during the first quarter, we acquired a 67% interest in Stanocola Home Health, based in Baton Rouge, Louisiana." Myers concluded, "At this point in time, we believe that we are on target to achieve those financial targets set by the guidance we gave on Feb 23, 2006, that is, we expect revenue for Fiscal 2006 to range between $200.0 and $215.0 million, exclusive of any potential acquisitions, and diluted earnings per share to approximate $0.95 to $1.00." Earnings estimates have been increasing steadily for next year. Expectations for 2007 are up 7.1% to $1.21 per share over the past 60 days. The company has posted an average earnings surprise of 25% over the past two quarters, with two analysts raising their numbers for 2006 and 2007. The stock is currently trading at 17.1x next year's estimates, below the long-term growth rate of 20%, giving the stock a PEG ratio of 0.86. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. The ranks are updated every Monday morning on Zacks.com. As such, it is prudent to check the site for the latest Zacks Rank on the stocks highlighted in this section. Simply click the link for the stock or enter the symbol in the ticker entry box in the upper left hand corner of the web site. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. Blog Home

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(GHL) - exceeded analysts' earnings expectations in four of the past five quarters

Greenhill & Co., Inc. (GHL) recently announced the acquisition of a Canadian independent investment bank. The deal gives the company an enhanced presence in Toronto and continues the strategy of expanding GHL's geographic reach. The acquisition also follows a positive revision in earnings estimates. Full Analysis Greenhill & Co., Inc. is an independent investment-banking firm. The company provides financial advice on mergers, acquisitions, restructurings and corporate finance matters worldwide. GHL also engages in merchant banking fund management, which consists primarily of management of Greenhill's private equity funds, Greenhill Capital Partners and principal investments by Greenhill in those funds. GHL exceeded analysts' earnings expectations in four of the past five quarters. In the four quarters that the company topped the Street's estimate, it did so by an average margin of 29%. Earnings per share are forecasted to grow 16% over the next 3-5 years. Las week the company announced the acquisition of Beaufort Partners, an independent investment bank based in Toronto. Robert F. Greenhill, Chairman and Chief Executive Officer of Greenhill said the addition of a strong team in Canada is a very natural step, adding that GHL plans to continue its strategy of extending geographic reach while it also continues to add expertise in key industries. Analysts remain bullish on the company's growth prospects, as is evident by the positive trend in earnings estimate revisions. Current consensus projections of $2.39 per share for 2006 and $2.61 for 2007 represent increases of 12.7% and 15.5%, respectively, over the past 90 days. The estimate revisions followed a positive first-quarter report. On Apr 20, Greenhill & Co. reported first-quarter earnings per share of 93 cents, 4.49% higher than the consensus earnings estimate. Profits grew from the previous year's 35 cents per share. Revenues for the first quarter totaled $100.9 million, which is an increase of 130% year-over-year. Robert F. Greenhill noted that he was pleased with the company's third consecutive record quarter, which was driven by strong results in its U.S. and European advisory businesses and another extraordinary performance in merchant banking. GHL's return on equity continues to soar past the industry average—59% versus 14%. The stock trades at a valuation of 24.1x trailing 12-month earnings and at 24.7x forecast earnings for this year. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. The ranks are updated every Monday morning on Zacks.com. As such, it is prudent to check the site for the latest Zacks Rank on the stocks highlighted in this section. Simply click the link for the stock or enter the symbol in the ticker entry box in the upper left hand corner of the web site. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. Blog Home

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(ASTE) - Two analysts raised their forecasts for the current year

Astec Industries, Inc. (ASTE) is enjoying strong business momentum as evidenced by its 30% increase in it backlog compared to a year ago. Analysts have been optimistic regarding the earnings prospects for ASTE as evidenced by the rising consensus estimates. Next year's estimates have increased 5.1% to $2.26 per share over the past 60 days. This year's numbers have risen 2.3% over the same time period. Full Analysis Astec Industries, Inc. engages in the manufacture and marketing of road building equipment in the United States and internationally. It operates in four divisions: Asphalt, Aggregate and Mining, Mobile Asphalt Paving, and Underground. The company also sells replacement parts. Astec Industries offers its products to asphalt road paving contractors, aggregate and hot-mix asphalt producers, utility and pipeline contractors, and open mine and quarry operators, as well as to various government agencies. ASTE reported strong first-quarter earnings in late April. The company earned 50 cents per share, exceeding the consensus estimate by 2%, and easily beating last year's 33 cents per share. Two analysts raised their forecasts for the current year. Analysts have been optimistic regarding the earnings prospects for ASTE as evidenced by the rising consensus estimates. Next year's estimates have increased 5.1% to $2.26 per share over the past 60 days. This year's numbers have risen 2.3% over the same time period. Despite fears of a slowdown, business still appears to be rock solid. First-quarter backlog was up 30% over last year, and the future is bright due to the recent passing of the House highway appropriation bill, which is providing $39.1 billion for the federal highway program. The stock is currently trading at a reasonable 14.4x next year's estimate of $2.26 per share, below the long-term growth rate of 17%. ASTE's price-to-book ratio of 2.6 is a third less than the market's ratio of 3.9. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. The ranks are updated every Monday morning on Zacks.com. As such, it is prudent to check the site for the latest Zacks Rank on the stocks highlighted in this section. Simply click the link for the stock or enter the symbol in the ticker entry box in the upper left hand corner of the web site. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. Blog Home

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(NATL) - National Interstate - a stock leaning the wrong way being hit with a positive earning surprise and now making new 52-week high

Full Analysis NATL reported first quarter earnings on May 9 of 44 cents per share, versus 39 cents last year. This represented a 12.8% positive earnings surprise over the analysts' consensus and was the fifth straight quarter that NATL exceeded expectations. While sales were down in the quarter by 24% to $55.06 million, income rose 21% to $8.49 million. Looking at the chart, the first thing that one notices is the tight trading range between roughly $22.00 and $20.00 beginning on Feb 1, 2006 and ending with a breakout to the downside on Apr 28, 2006. The second aspect to notice is the failure of that breakout and the ultimate breakout to the upside that followed. Savvy Momentum traders wait a while after unusual events such as gaps to see if the stock doesn't simply correct itself. This chart is a good example why. Certainly NATL had a significant breakout to the downside on Apr 28. However, within five trading sessions, the stock had climbed back into the previous trading range and, by May 15, broke out of the trading range to the upside. Clearly this was a stock leaning the wrong way being hit with a positive earning surprise and now making new 52-week highs. This stock should continue higher, as the power of the move was intensified by the failure of the breakout to the downside. Background National Interstate Corporation is a specialty property and casualty insurance company with a niche orientation and focus on the transportation industry. Their core products include property and casualty insurance for transportation companies, group captive insurance programs for transportation companies that they refer to as their alternative risk transfer operations, specialty personal lines, primarily, recreational vehicle coverage and general commercial insurance in Hawaii. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. The ranks are updated every Monday morning on Zacks.com. As such, it is prudent to check the site for the latest Zacks Rank on the stocks highlighted in this section. Simply click the link for the stock or enter the symbol in the ticker entry box in the upper left hand corner of the web site. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. Blog Home

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(ACLI) - ACLI recently raised guidance for this year due to pricing strength and improved efficiency benefits

American Commercial Lines, Inc. (ACLI) has exceeded earnings estimates by an average of about 20% over the past two quarters. This year's estimates have been on the upswing over the past week, rising 12.6% over that time period. The stock is trading at 18.8x next year's estimates of $3.04 per share, below the long-term growth rate of 27.3%, giving the stock a PEG ratio of 0.69. Full Analysis American Commercial Lines, Inc. operates as a marine transportation and service company in the United States. The company operates in two segments, Transportation and Manufacturing. The company also provides third party logistic, as well as container transportation services between Chicago and New Orleans, through its joint venture with MBLX, Inc. In addition, it offers fleeting, shifting, cleaning, and repair services for barges and towboats of third-party customers, as well as operates cargo transfer facility terminals between various modes of transportation. As of December 31, 2005, the company operated 3,174 barges, including approximately 2,441 covered dry cargo barges, 362 open dry cargo barges, and 371 liquid cargo tank barges in its domestic fleet; 120 dry cargo barges and 7 towboats in Venezuela; and 6 barges and 1 towboat in the Dominican Republic. In late April, the company announced excellent first-quarter earnings. Revenues for the quarter were $198 million, a 36% increase compared with $146 million for the first quarter of 2005. Net income for the quarter was $11.1 million or 36 cents per share compared to a net loss of $(6.3) million for the first quarter last year. Analysts had expected 29 cents per share. Commenting on the quarter, Mark R. Holden, President and Chief Executive Officer, stated: "We are pleased with our results for the first quarter. As previously announced, industry fundamentals continued to strengthen during the first quarter in both of our business segments, transportation and manufacturing. First quarter results benefited from very favorable operating conditions, stronger than normal freight demand and accelerating productivity gains within our manufacturing business." ACLI recently raised guidance for this year due to pricing strength and improved efficiency benefits. This prompted Merrill Lynch analyst Jeff Fidacaro to increase his estimates, citing better-than-expected pricing for barge transportation services. The analyst reiterated a "Buy" rating and a $64 target price and said he remains "bullish" about the industry's prospects. The company has exceeded earnings estimates by an average of about 20% over the past two quarters. This year's estimates have been on the upswing over the past week, rising 12.6% over that time period. The stock is trading at 18.8x next year's estimates of $3.04 per share, below the long-term growth rate of 27.3%, giving the stock a PEG ratio of 0.69. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. The ranks are updated every Monday morning on Zacks.com. As such, it is prudent to check the site for the latest Zacks Rank on the stocks highlighted in this section. Simply click the link for the stock or enter the symbol in the ticker entry box in the upper left hand corner of the web site. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. Blog Home

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(OMM) - reported revenues up 17% - (GOOG) - impressive relative strength

Gregory Spear, editor of The Spear Report newsletter, saw a vulnerable market that was saved by Thursday's action. Discover what this featured expert has to say about the difference between a correction in an uptrend and the start of a bear market. Then benefit from his recommendation. Afterward, read Spear's update on the home building industry and check out a few stock profiles. Detail from June 16 When the Fed chairman speaks, the market listens. Or so it seems. On Thursday, Chairman Bernanke made comments that seemed to imply that inflationary pressures have receded in the past month, despite the higher than expected readings in core consumer and producer prices. ["Inflation compensation implied by yields on government debt has fallen back somewhat in the past month...."]. What he means here is that the treasury yields have actually had a difficult time staying above the targeted Fed funds rate, currently 5%, and he takes this sluggishness as a sign of lower inflation expectations. The inverted yield curve with respect to the 2-year and 10-year bonds further supports this interpretation. In Gregory Spear and his team's view, however, little in the way of Fed policy actually changed on Thursday. Instead, our oversold market simply was ready for a bounce and was waiting for a news catalyst it could spin in the appropriate direction. After five weeks of unrelenting selling, virtually all bourses around the globe were oversold enough this week to mount serious relief rallies as well. We have had a synchronized global decline since early May, and now we are being blessed with a synchronized global rally. The most important thing to determine in market analysis, however, is the difference between a correction in an uptrend and the start of a bear market. The latter is a much rarer situation, of course. When a bear market begins, after the first oversold bounce has run its course, the market begins to fall quickly once again. Spear and his team have been paying a great deal of attention to the technical state of the market lately, as the vast majority of Consensus stocks are correlated with the major indices. Their analysis over the past few weeks suggested that the market was vulnerable, especially given the bearish bubble-popping conditions around the globe, where some bourses have been taken down nearly 30% in five weeks. Thursday's impressive rally, however, has saved the day, at least for now. Of course, this is a market capable of turning on a dime, so Spear and his team recommend investors not become complacent. Most market bottoms are not "V-shaped" affairs, but rather are hammered out with one or two re-tests over a period of a few weeks. Moreover, the Buy List appears to be a little skeptical, as well, with the same two lonely members Spear and his team had last week. Home Builder Update They can't describe the homebuilders as "bulletproof," but their recent decline seems close to capitulatory to Spear and his team, and many bounced nicely on Thursday from very oversold conditions. What are the fundamentals in the industry? They are declining from the extraordinary momentum that they enjoyed in 2003-2005. Companies are reducing guidance and analysts are cutting estimates, sending many stocks below peak 2004 levels. That's the short-term story. But a study by Harvard's Joint Center for Housing Studies argues that the housing construction boom is unlikely to undergo more than a modest downturn despite dramatically expanding inventories in certain over-heated areas, unless, of course, the broader economy collapses. In fact, due to demographic shifts toward more second homes and more single-person homes, along with population expansion, the demand for housing over the next 10 years will likely exceed the 18 million units built from 1995 to 2004. The study predicts that homeowners with adjustable rate mortgages will benefit by offsetting home appreciation and a flood of foreclosures will be averted due to the ability of these folks to sell at a profit, if necessary. The Harvard study predicts that the housing industry will actually emerge stronger than ever after this downturn. Two Consensus homebuilders that have shown recent relative strength this week while other builders were in decline: Centex (CTX) and D.R. Horton (DHI). A sampling of profiled stocks: OMI Corp (OMM) owns and operates a fleet of 49 oil tankers and product carriers, comprised of 13 Suezmaxes for carrying crude oil and 36 "clean" product carriers. For the first two years of the cyclical bull market (2003-2004), shipping stocks were investment darlings but for the last 18 months, the stocks of most companies in this industry have been declining, despite high dividend yields and low P/E ratios. Of course, we know from the current situation with the homebuilders that extreme value does not necessarily make for an uptrending stock, when industry prospects are declining from ideal levels. The tanker bear market has arisen due to concerns that day rates were dropping while the shipping fleet was increasing. In the first quarter of 2006, however, the world tanker fleet grew just 3%. Based on the current order book, Spear and his team expect the tanker and product ship fleet will each increase about 6-7% annually over the next four years. Tankers are a play on globalization, which Spear believes is a theme that is not going away. Interestingly, none of these stocks is collapsing along with the emerging market bourses, which indicates that the global economy is likely to remain strong even as the froth is wrung out of the regional stock markets. In the most recent quarter, OMI reported revenues up 17% to $193 million and net income of $63.5 million or $0.89 a share, a penny better than the year-ago quarter and a company record for the first quarter. Interestingly, while crude oil revenues declined slightly, the revenue from its product carriers increased sharply, with day rates up 21% sequentially and 31% above year-ago levels. During 2006, OMI has a $70 million share repurchase program in effect, which is about 60% competed and the company pays a 2% dividend. Google's (GOOG) impressive relative strength has been surprising to Spear and his team, especially considering that it attained cult status during the 16 months subsequent to its August 2004 IPO. The leaders of a bull market often lead to the downside as well, since investors have more profits to protect. So why is Google acting so strong? The main reason is that the fast-growing company is beginning to diversify its offerings beyond search. Last week, GOOG introduced a spreadsheet application that suggests an incipient assault on Microsoft's desktop suite. Earlier in the year, the company acquired Writely, which provides a Web-based word processing program. These tools will become future advertising platforms for those who want free software. They won't replace Microsoft's dominance at the enterprise level, but they will fill an underserved niche as computing becomes ubiquitous, and help assure Google's global penetration at the consumer and small business level. At this time, Google derives virtually all of its revenue from selling simple pay-per-click text advertising, not graphical ads, such as banners. That is about to change and should provide another earnings catalyst going forward, as banners and video are now lucrative elements of chief rival Yahoo's business model. Google reported revenues of $2.25 billion for the quarter ended March 31, an increase of 79% year-over-year and 17% sequentially. That is impressive for a company that is already over $100 billion in market cap. On a worldwide basis, Google employed 6,800 people at the end of the first quarter, up 20% from the beginning of the year. Earnings for the first quarter came in at $1.95 per share, up 60% sequentially and the company has about $10 billion in cash. A Stock from the Consensus Buy List: Movie Gallery (MOVI) owns and operates 695 video specialty stores in 17 states, primarily in the Southeast and Midwest, that rent and sell vidocassettes and video games. Content Courtesy: Zacks Investment Research Blog Home

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(RAIL) - A Buy Recommendation - particular expertise in coal-carrying railcars

Donald Rowe, editor of the Wall Street Digest newsletter, explains that a bull market will not unfold until bond traders and the Wall Street professionals become comfortable with Bernanke's handling of certain items. Read about the conditions this featured expert outlines. Then find out why he says keep your eyes on gold and commodities. Afterward, learn about a recent buy. Commentary from June 20 Although housing starts rose five percent in May, building permits fell to the lowest rate in 2-1/2 years. Today's home construction data, next week's new and existing homes sales reports, and Friday's durable goods report are the economic news of interest leading into next week's FOMC meeting. A 17th straight quarter-point hike in Fed funds is fully expected, but will the Fed's comments on inflation continue to rattle the markets? Donald Rowe and his team do not see a bull market unfolding until bond traders and the Wall Street professionals are comfortable with Bernanke's handling of: 1) inflationary pressures; 2) a sick housing market; 3) a depreciating dollar; and 4) the Federal “Open Mouth” Committee. Fed Chairman Bernanke must become the sole spokesman of the Federal Reserve Board in order to restore calm in the financial markets--after which, Rowe and his team expect a bull market in stocks to unfold when the Nasdaq Composite is ready to lead it and not until. Keep your eyes on gold and commodities. If the price of gold is rising, the dollar is losing purchasing power. And if the boom in commodities resumes, we'll have two bull market opportunities: one in the U.S. stock market, and the other in a global commodities boom. A Buy Recommendation: FreightCar America, Inc. (RAIL) manufactures railroad freight cars, with particular expertise in coal-carrying railcars. In addition to coal cars, FreightCar America designs and builds flat cars, mill gondola cars, intermodal cars, coil steel cars and motor vehicle carriers. It is headquartered in Chicago, Illinois and has manufacturing facilities in Danville, Illinois, Roanoke, Virginia and Johnstown, Pennsylvania. Content Courtesy: Zacks Investment Research Blog Home

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(FCBP) - "fast-grower" because its growth (which is 30.91%) is greater than 20% - Also (ANF) - (TWGP)

John Reese, editor of the Validea Hot List newsletter, provides his regular update on the performance of the Hot List portfolio and details its holdings. Find out where the portfolio stands versus the S&P 500. Then discover what this featured expert has to say about a company that can be categorized as a fast-grower. Afterward, learn about two more Hot List stocks. The Validea Hot List Performance from June 16 Since John Reese and his team's last issue, both the S&P 500 and the Validea Hot List have declined. The Hot List was down 5.1%, while the S&P 500 was up 2.3%. Year-to-date, the Validea Hot List continues to handily outperform the S&P 500: 17.2 percent against 0.6 percent. Since the inception of the Validea Hot List, it has risen 160.1 percent, versus a gain of 25.6 percent for the S&P 500. An Addition to the Hot List First Community Bancorp (FCBP) This Southern California-based bank gets high grades from Reese and his team's interpretation of two guru strategies. One of the gurus is Peter Lynch. The Peter Lynch Strategy The Lynch strategy, based on Reese's interpretation of Peter Lynch's writings, categorizes First Community as a "fast-grower" because its growth (which is 30.91%) is greater than 20%. The Lynch strategy's famous P/E/G ratio, which looks at the P/E ratio relative to the growth rate, is 0.60. To pass this test, the P/E/G has to be 1.0 or less, which is true for First Community. This methodology favors companies that have several years of fast earnings growth, as these companies have a proven formula for growth that in many cases can continue many more years. The desired growth rate ranges from 20 percent to 50 percent, and First Community's EPS growth rate of 30.91% fits the bill. The Lynch strategy uses the equity/assets ratio as a way to determine a financial intermediary's health. First Community's E/A ratio of 17.0% is above the 5% minimum this strategy requires and is extremely healthy. The return-on-assets ratio is used to measure a financial intermediary's profitability. First Community's ROA of 1.77% is above the minimum 1% that this methodology looks for. A Sampling of the Hot List Abercrombie & Fitch Co. (ANF) is a specialty retailer that operates stores selling casual apparel, such as knit shirts, graphic t-shirts, jeans, woven shirts, shorts, as well as personal care and other accessories for men, women and kids under the Abercrombie & Fitch, abercrombie, Hollister and RUEHL brands. As of January 28, 2006, the Company operated 851 stores in the United States and Canada. During the fiscal year ended January 28, 2006 (fiscal 2005), A&F purchased merchandise from approximately 246 factories and suppliers located throughout the world, primarily in Southeast Asia and Central and South America. In fiscal 2005, the Company did not source more than 5% of its apparel from any single factory or supplier. A&F pursues global sourcing that includes relationships with vendors in 40 countries and the United States. Tower Group, Inc. (TWGP) offers a range of specialized property and casualty insurance products and services to small to mid-sized businesses and to individuals in New York State and the surrounding areas through its wholly owned subsidiaries, Tower Insurance Company of New York (TICNY), Tower National Insurance Company (TNIC) and Tower Risk Management Corporation (TRM). TICNY is a property-casualty insurance company. TNIC is a property and casualty insurance company. TRM is a non-risk-bearing insurance services company that produces, through its managing general agency, business on behalf of other insurance companies. The Company's commercial lines products provide insurance coverage to businesses, such as retail and wholesale stores, grocery stores, restaurants, artisan contractors, and residential and commercial buildings, while its personal lines products focus on modestly valued homes and dwellings. Tower operates in three segments: Insurance, Reinsurance and Insurance Services. Content Courtesy: Zacks Investment Research Blog Home

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(SJM) - in spite of higher transportation and commodity costs, it was able to maintain gross margins

Bill Martin, editor of the FindProfit newsletter, explains that JM Smucker has come through with the reliable performance he was hoping for when he added the stock. Read this featured expert's update on recent earnings and revenue. Then find out why Martin and his team continue to like this company. Commentary from June 20 JM Smucker (SJM): The jam, peanut butter, and baking goods maker booked a profit of $35.7 million, or 62 cents per share, up from $22.1 million, or 38 cents per share, a year ago. The profit came on revenue of $501.7 million, up 2% from $491.5 million last year. Backing out pretax merger and integration costs of 4 cents per share and restructuring charges of 2 cents per share, SJM's quarterly profit came in at 68 cents per share compared to 58 cents per share on a comparable basis a year ago. The company said that sales of fruit spreads, toppings, peanut butter, and Uncrustables were all up for the quarter. SJM also said that in spite of higher transportation and commodity costs, it was able to maintain gross margins by keeping other costs down. Management continues to run a very tight ship. The company reiterated its forecast for long-term sales growth of 8%, approximately half of which is to come from growth in core operations, with the balance coming from bolt-on acquisitions. Bottom Line: While certainly not as glamorous as some of Bill Martin and his team's other holdings, SJM has come through with the reliable performance they were hoping for when they added the stock in April. Since then, as much of the market has tanked, this consumer staples name has managed to put up a 12% gain. When Martin and his team added SJM, they wrote: "While clearly not as exciting as a high-flying copper or gold stock, we believe that SJM represents an attractive long-term investment at these levels. Specifically, we believe that the triple combo of a trough in margins, a trough in the PE multiple, and a trough in investor expectations makes this the right time to tuck some SJM away for long-term focused accounts." With today's report, SJM has held margins steady in a difficult operating environment, and at the same time, as Martin and his team expected, the stock's valuation and investors' enthusiasm are on the rebound. With long-term guidance reaffirmed, Martin and his team have no reason to expect the SJM story to change any time soon, and they continue to like this "stable" stock in the face of continued market volatility. Content Courtesy: Zacks Investment Research Blog Home

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