(HOS) - Strong Buy - Companies obtain this coveted status by receiving upward earnings estimate revisions and achieving earnings per share surprises

Hornbeck Offshore Services, Inc. (HOS) was first presented as a Value stock on Mar 10 and is still a Zacks #1 Rank. The company met or topped analysts' earnings expectations for the past nine quarters. HOS recently upped its 2006 and 2007 earnings per share guidance. HOS has a price-to-book ratio of 2.0, compared to 5.0 for the market. Its return on equity of 16% betters the industry average of 15%. Full Analysis Hornbeck Offshore Services, Inc. provides offshore supply vessels for the offshore oil and gas industry, primarily in the United States, Gulf of Mexico and internationally. The company operates in two segments: offshore supply vessels and tug and tank barge. Nearly six months after HOS was first highlighted as a Value stock, it is still a Zacks #1 Rank (strong buy). Companies obtain this coveted status by receiving upward earnings estimate revisions and achieving earnings per share surprises. In the two quarters since its debut, HOS topped the Street's estimate by 10.2% in the first quarter of 2006 and met expectations in the second quarter. Even though the company failed to surprise to the upside in the second quarter, earnings skyrocketed 93.9% when compared to the prior-year period. Revenues soared 72.0% to $70.7 million compared to $41.1 million for the second quarter of 2005. Chairman, President and CEO Todd Hornbeck stated, "We are very pleased with yet another quarter of record financial results, which were largely driven by our diversified business model. With both of our fleet segments ‘hitting on all cylinders,' we continue to post industry-leading margins and returns on invested capital and have, again, significantly increased our annual 2006 and 2007 guidance." HOS now expects 2006 earnings per share between $2.60 and $2.72, compared to its prior guidance between $2.49 and $2.60. Moreover, the company also raised its 2007 profit guidance, now calling for earnings per share between $2.72 and $2.95, versus its previous outlook between $2.70 and $2.92. Analysts responded to HOS's revised guidance by boosting their profit forecasts. Consensus estimates for this quarter and next jumped 7.5% and 5.9%, respectively, over the past 30 days. Estimates for full years 2006 and 2007 rose 6.7% and 4.5%, respectively, in the same timeframe. Earnings per share are forecasted to grow a robust 42% over the next 3-5 years, with the industry expected to grow at a 15% clip. The company is currently trading at a valuation of 15.3x trailing 12-month earnings and at 12.3x current fiscal-year estimated earnings. The market, as represented by the S&P 500, is trading at a valuation of 16.5x trailing 12-month earnings and at 15.8x its current fiscal-year estimated earnings. HOS has a price-to-book ratio of 2.0, compared to 5.0 for the market and its PEG ratio currently stands at 0.29. The company's return on equity of 16% betters the industry average of 15%. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. This important indicator is updated daily on Zacks.com and is available to Zacks Premium subscribers. 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| VitalStocks Home

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(GVA) - Granite Construction Inc. - One of the nation's largest heavy civil contractors and construction materials producers

Granite Construction Incorporated (GVA), which was first highlighted as a Growth and Income stock on Mar 3, topped analysts' earnings expectations over the past four quarters by an average margin of 33.0%. Earnings per share are projected to grow 13% over the next 3-5 years. Consensus estimates for this year and next have been climbing. This Zacks #1 Rank stock's return on equity exceeds that of the industry average--17% compared to 12%. Full Analysis Granite Construction Incorporated is the parent company of Granite Construction Company, one of the nation's largest heavy civil contractors and construction materials producers. When GVA was first presented as a Growth and Income stock on Mar 3, it had met or exceeded the consensus earnings estimate in six out of the past seven quarters. In the two quarters since the company's debut, GVA surprised to the upside by an average margin of 39.5%. Most importantly, the company is still a Zacks #1 Rank stock (strong buy). On Jul 26, GVA reported second-quarter profits of $33.3 million, or 80 cents per share. The result beat the Street's estimate of 54 cents by 48.2% and crushed earnings in the prior-year period by 122.2%. Total revenues increased 20.0% to $812.0 million compared with $676.7 million a year earlier. For the first six months of the year, GVA's profits came in at $31.9 million, compared to $6.7 million for the first half of 2005. Total revenues climbed 18.2% to $1.3 billion. GVA increased revenues for the past nine years, most recently by 23.7% in 2005. The consensus estimate for this year currently calls for $2.72. This represents an 11.5% jump when compared to the consensus of 60 days ago. For 2007, profit forecasts have risen 10.8% to $2.98. Five analysts submitted upward revisions for both years. Earnings per share are projected to grow 13% over the next 3-5 years, which is in line with the expected growth rate of the industry. President and CEO William G. Dorey stated, “As a result of our second quarter performance, operating cash flow continues to improve.” This should bode well for those seeking additional income in the form of a dividend. The Board of Directors declared a quarterly cash dividend of 10 cents per common share of stock on Jul 24. The dividend is payable Oct 13 to shareholders of record as of Sep 30. The company is currently yielding 0.76%. GVA's profitability is quite impressive. Its return on equity exceeds that of the industry average—-17% compared to 12%. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. This important indicator is updated daily on Zacks.com and is available to Zacks Premium subscribers. 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| VitalStocks Home

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(MOLX) - Three analysts raised their numbers for this fiscal year, while one has bumped his numbers for next year

Molex posted record earnings in its latest quarter. The company is also used to beating analyst expectations, as it has done so in each of the past four quarters by an average of almost 12%. Three analysts raised their numbers for this fiscal year, while one has bumped his numbers for next year. Over the past month this year's estimates have risen 2.4% to $1.68 per share. The stock is currently trading at 19.3x next year's estimates of $1.90 per share. Full Analysis Molex Incorporated (MOLX) engages in the design, manufacture, and sale of electromechanical components worldwide. It offers micro-miniature connectors, SIM card sockets, keypads, electromechanical subassemblies, and internal antennas and subsystems for telecommunications market; and manufactures power, optical, and signal connectors and cables for end-to-end data transfer, linking disk drives, controllers, servers, switches, and storage enclosures for data products market. The company also provides interconnects used in air bag and seatbelts, tire pressure monitoring systems and powertrain, and window and temperature controls; and designs and manufactures connectors for home and portable audio, digital still and video cameras, DVD players, and recorders, as well as devices that combine multiple functions. In addition, the company manufactures cables, backplanes, power connectors, and integrated products that are found in products ranging from electronic weighing stations to industrial microscopes and vision systems, Molex reported a strong fiscal fourth-quarter profit in early-August. For the quarter ended June 30, earnings were $70.3 million, or 42 cents per share, up from $4.9 million, or 3 cents per share, a year ago. Analysts expected 37 cents per share for the quarter. Revenue rose 22 percent to $783.8 million from $643.8 million. Gross profit margin increased to 35.0 percent, compared with 33.4 percent in last year's fourth quarter. Martin P. Slark, CEO and Vice-Chairman commented, "This was an exceptional quarter, with revenue growth 21.8% over the prior year June quarter, and a record high for earnings per share. Revenue growth was broad-based, with nearly all major markets and geographies showing significant gains. When compared with last year's fourth quarter, revenue in the consumer market increased 32%. Our customer's new products in this market continue to deliver higher functionality and mobility, thus requiring interconnects based primarily upon digital and micro-miniature technology. These technologies are a major strength of Molex and contribute to our growth in a broad array of other markets as well." Molex is used to beating analyst expectations, as it has done so in each of the past four quarters by an average of almost 12%. Three analysts raised their numbers for this fiscal year, while one has bumped his numbers for next year. Over the past month this year's estimates have risen 2.4% to $1.68 per share. The stock is currently trading at 19.3x next year's estimates of $1.90 per share. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. This important indicator is updated daily on Zacks.com and is available to Zacks Premium subscribers. 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| VitalStocks Home

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(ACAP) - has a price-to-book ratio of only 1.6, compared to 5.0 for the market

American Physicians Capital, Inc. (ACAP), a Zacks #1 Rank stock, exceeded analysts' earnings expectations over the past five quarters by an average margin of 20.8%. Consensus estimates have been trending higher. The Board of Directors recently upped its share repurchase program. ACAP has a price-to-book ratio of only 1.6, compared to 5.0 for the market. Full Analysis American Physicians Capital, Inc., through its subsidiaries, provides medical professional liability insurance in the United States. The company is focused primarily in the Midwest, with Michigan, Illinois, Ohio, Kentucky and New Mexico serving as its core states. ACAP has a solid history of exceeding analysts' earnings expectations. Over the past five quarters in which the company beat the Street's estimate, its average margin of surprise was an impressive 20.8%. On Jul 25, ACAP posted second-quarter profits $1.19 cents per share. With analysts calling for 95 cents per share, the company topped estimates by a robust 25.3%. President and Chief Executive Officer R. Kevin Clinton stated, “We are very pleased with the continued success of the company. Our business plan is working as we remain competitive in the marketplace while maintaining profitability and maximizing shareholder value.” Clinton's mention of maximizing shareholder value is evident in the company's stock repurchase program. ACAP repurchased 293,100 shares of its common stock during the second quarter and 420,600 shares in the first six months of 2006. Furthermore, on Aug 22, the Board of Directors boosted its stock buyback plan to $30 million, up from the $20 million plan authorized in April. Looking ahead, the company stated it is becoming more aggressive in selected markets where it can grow profitability and remains watchful for other opportunities to increase shareholder value. ACAP's return on equity, or a common measure of a company's level of profitability, tops that of the industry average—13% compared to 11%. Analysts' earnings estimates have been climbing higher. The consensus estimate for this quarter currently sits at $1.03 and represents a 9.6% increase when compared to the consensus of 90 days ago. Profit forecasts for the full year of 2006 jumped by an even greater magnitude—13.9% to $4.33. The company is currently trading at a valuation of 12.1x trailing 12-month earnings and at 11.3x current fiscal-year estimated earnings. The market, as represented by the S&P 500, is trading at a valuation of 16.5x trailing 12-month earnings and at 15.8x its current fiscal-year estimated earnings. ACAP has a price-to-book ratio of only 1.6, compared to 5.0 for the market. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. This important indicator is updated daily on Zacks.com and is available to Zacks Premium subscribers. 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| VitalStocks Home

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(LDG) - beat the Street's second-quarter fiscal 2007 earnings estimate by an impressive 25.0%

Longs Drug Stores Corporation (LDG) topped the Street's earnings estimate over the past five quarters by an average margin of 15.0%. After posting solid results for the second quarter of fiscal 2007, LDG raised its full-year earnings per share outlook. Consensus estimates have been on the rise for this Zacks #1 Rank stock. The company is currently yielding 1.2%. Full Analysis Longs Drug Stores Corporation provides retail drug and pharmacy benefit services in the United States. The company is one of the most recognized retail drug store chains on the West Coast, with more than 470 stores in California, Hawaii, Washington, Nevada, Colorado and Oregon. LDG exceeded analysts' earnings expectations over the past five quarters by an average margin of 15.0%. Earnings per share grew 7% over the past five years and are forecasted to grow by a much greater magnitude going forward--18% over the next 3-5 years. The industry is expected to grow at a 15% clip. On Aug 16, LDG beat the Street's second-quarter fiscal 2007 earnings estimate by an impressive 25.0% with profits of 50 cents per share. The company posted earnings per share of 38 cents in the prior-year period, representing a 31.6% year-over-year improvement. Revenues increased 9.5% to $1.27 billion from $1.16 billion reported in the second quarter of fiscal 2006. Same-store sales, tracking the performance of stores open at least a year, jumped 2.6%. Along with releasing solid results for the second quarter, LDG also upped its fiscal 2007 earnings per share guidance. The company now expects profits between $1.84 and $1.94 per share, compared to its previous outlook, which called for earnings per share between $1.74 and $1.84. The consensus estimate for this quarter currently resides at 31 cents and represents a 14.8% increase when compared to the consensus of 30 days ago. Profit forecasts for fiscal 2007 jumped 7.1% to $1.95 over the same period of time. Three analysts submitted upward revisions for both this quarter and for fiscal 2007. On Aug 22, the Board of Directors declared a quarterly cash dividend of 14 cents per share, payable on Oct 10 to shareholders of record as of Aug 29. The company is currently yielding 1.2%. LDG's purchase of Network Pharmaceuticals, Inc. on Jun 12 for approximately $10 million will enable it to acquire 21 retail pharmacies, one wholesale pharmacy and one closed-door pharmacy, plus inventory. The acquisition should be a positive influence on the company's future growth. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. This important indicator is updated daily on Zacks.com and is available to Zacks Premium subscribers. 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| VitalStocks Home

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(LECO) - In late-July, LECO said its second-quarter profit surged nearly 33 percent

LECO has exceeded analyst estimates in each of the past five quarters with four analysts raising their numbers. Over the past 60 days, this year's estimates have jumped 4.4% to $3.76 per share, while next year's numbers have risen 10.6% to $4.48 per share. LECO is currently trading at 12.3x next year's earnings, well below the projected long-term growth rate of 18.75%, giving the stock a PEG ratio of 0.66. Full Analysis Lincoln Electric Holdings, Inc. (LECO) , through its subsidiaries, engages in the manufacture and resale of welding and cutting products worldwide. Its welding products include arc welding power sources, wire feeding systems, robotic welding packages, fume extraction equipment, consumable electrodes, and fluxes, as well as regulators and torches used in oxy-fuel welding and cutting. The company's customers comprise companies operating in general metal fabrication; infrastructure, including oil and gas pipelines and platforms, buildings, bridges, and power generation; transportation and defense industries; equipment manufacture in construction, farming, and mining; retail resale; and rental market. In late-July, LECO said its second-quarter profit surged nearly 33 percent, on strong sales in North America and overseas. Net income for the quarter was $42.6 million, or 99 cents per share, up from $32.1 million, or 77 cents per share, last year. Revenue for the quarter was $502.5 million, up 24 percent from $405.9 million. Analysts had expected 95 cents. Sales in North America rose 27 percent to $335.7 million, with 5 percentage points of that increase coming from the 2005 acquisition of soldering alloys maker J.W. Harris. Sales outside of North America increased to $166.8 million from $140.5 million. "We had another excellent quarter," said John M. Stropki, Chairman and Chief Executive Officer. "Our solid performance reflects a strong global business environment and effective execution from our management team and employees which resulted in another record quarter for both sales and profitability. In addition, we are pleased with the improved operating leverage driven by significant increases in volume and ongoing cost control. LECO has exceeded analyst estimates in each of the past five quarters with four analysts raising their numbers. Over the past 60 days, this year's estimates have jumped 4.4% to $3.76 per share, while next year's numbers have risen 10.6% to $4.48 per share. LECO is currently trading at 12.3x next year's earnings, well below the projected long-term growth rate of 18.75%, giving the stock a PEG ratio of 0.66. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. This important indicator is updated daily on Zacks.com and is available to Zacks Premium subscribers. 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| VitalStocks Home

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(SPSX) - Superior Essex, Inc. - "For the 10th consecutive quarter, Superior Essex delivered year-over-year revenue growth"

Shares of Superior Essex, Inc. (SPSX) are up by more than 24% since last being featured on June 29. The rise in the stock's prices comes as estimates are revised upwards. During the past 30 days, forecasts for full-year earnings have been climbed 43%. Projections for 2007 are up as well, advancing by 16%. Even with this bullishness, SPSX continues to trade a discount valuation with a P/E multiple of 14.5 and a price-to-book ratio of 2.7. 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. In late July, SPSX reported second-quarter adjusted earnings of $1.28 per share. The result soared past the previous year's 43 cents and more than doubled analysts' forecasts of 58 cents. Revenues came in at $818 million for second quarter, which surpassed the year-prior total of $430 million. "For the 10th consecutive quarter, Superior Essex delivered year-over-year revenue and adjusted EBITDA growth," said Stephen M. Carter, chief executive officer of Superior Essex. "We are particularly pleased with the meaningful contribution from our European operations, as well as the productivity improvements we are achieving and the price strengthening we are experiencing in certain sectors of our business." Carter also stated that based upon the outstanding results for the first six months of 2006, and the company's assessment of current conditions in its industries, the company's outlook for full year 2006 remains positive. The company did recently announce a proposal to acquire all of the outstanding shares of Optical Cable Corporation (OCCF). However, the offer was rejected. Wall Street expectations for 2006 and 2007 have been moving up. During the past 30 trading days, this year's earnings estimates climbed 43%. Projections for 2007 advanced by 16% over the same time period. SPSX sports a P/E ratio of 14.5 and a price-to-book ratio of 2.7, both below the S&P 500. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. This important indicator is updated daily on Zacks.com and is available to Zacks Premium subscribers. 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| VitalStocks Home

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(HSC) - Harsco Corporation - 12.7% increase in consensus estimates in the past 30 days

Harsco Corporation (HSC), first introduced as a Growth and Income pick on May 25, continues to shine. The company exceeded analysts' earnings expectations for 12 consecutive quarters, most recently by 14.3%. Earnings per share are projected to grow 14% over the next 3-5 years. After posting solid results for the second quarter of 2006, HSC upped its full-year earnings per share guidance. The company has a current dividend yield of 1.6%. Full Analysis Harsco Corporation is a diversified, worldwide industrial company. HSC's operations fall into three segments: mill services, access services and gas technologies, plus an all other category labeled engineered products and services. The company has locations in 45 countries. HSC, first highlighted as a Growth and Income pick on May 25, recently added yet another earnings surprise to its long list of quarters in which it has exceeded analysts' estimates. The company topped the Street's estimate for the past 12 quarters by an average margin of 16.2%. Earnings per share grew 13% over the past five years and are forecasted to grow by a slightly greater rate going forward--14% over the next 3-5 years. The industry's projected growth rate is 12%. On Jul 27, HSC posted second-quarter profits of $53.9 million, or $1.28 per share, topping the consensus estimate by an impressive 14.3%. In the second quarter of 2005, the company reported profits of $41.7 million, or 99 cents per share, equating to a 29.3% year-over-year improvement. Revenues climbed 24.3% to $865.5 million from $696.1 million last year. In addition to announcing solid results for its most recent quarter, HSC also upped its full-year 2006 earnings per share guidance. The company now expects earnings between $4.32 and $4.42 per share, versus its prior outlook which called for between $4.00 and $4.10. Analysts responded by boosting their profit forecasts. The consensus estimate for this quarter currently resides at $1.24--marking a 12.7% increase when compared to the consensus of 30 days earlier. For the full year of 2006, analysts upped their projections by 5.5% to $4.43. The Board of Directors declared a quarterly cash dividend of 32.5 cents per share of stock on Jun 20. The payment represents the 225th consecutive quarterly dividend distributed to shareholders. Furthermore, HSC has increased its dividend in each of the past twelve years. The company is currently yielding 1.6%, compared to 1.3% for the industry average. HSC's return on equity, a common measure of a company's level of profitability, betters that of the industry average—18% compared to 16%. HSC is a Zacks #2 Rank (Buy) stock. Zacks #2 Rank stocks have generated an average annual return of 21.6% since 1988. Because the Zacks Rank has a market cap bias, Growth & Income investors may find a greater number of large-cap stocks by considering both Zacks #1 Rank (Strong Buy) and Zacks #2 Rank (Buy) stocks in their selection criteria. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. This important indicator is updated daily on Zacks.com and is available to Zacks Premium subscribers. 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| VitalStocks Home

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(RSTO) - Restoration Hardware, Inc. - sales climbed 24 percent from last year

Restoration Hardware just reported a surprise profit in its second quarter. Additionally, the company has met or exceeded earnings estimates in six out of the past seven quarters. One analyst has increased his numbers for this year, while two have done so for next year. Over the past 90 days, next year's estimates have increased 7.1% to 30 cents per share. This could rise in the wake of RSTO's better than expected second quarter. Full Analysis Restoration Hardware, Inc., (RSTO) through its subsidiaries, operates as a specialty retailer of bathware, hardware, lighting, furniture, textiles, accessories, and related merchandise. It also manufactures a line of furniture for the home and office. The company sells its products through retail locations, catalogs, and the Internet. As of April 4, 2006, the company operated 103 retail stores and 6 outlet stores in 30 states, the District of Columbia, and Canada. The company reported a suprise second-quarter profit on August 28. RSTO came in with a penny a share versus a loss of seven cents last year. Analysts expected a loss of five cents for the second quarter. Quarterly sales climbed 24 percent to $179.3 million from last year's $144.8 million. Sales at stores open at least a year -- called same-store sales, a widely watched business performance gauge -- rose 4.3 percent during the quarter. Direct-to-customer revenue increased 58 percent to $67.9 million. "We are proud to announce that for the first time in the Company's history, we were profitable outside of the fourth quarter," said Gary Friedman, the Company's President, Chief Executive Officer and Chairman. "This milestone, and the strong customer response to our product offerings, validates our work to position Restoration Hardware as the premium home furnishings brand in the marketplace." The company has met or exceeded earnings estimates in six out of the past seven quarters. One analyst has increased his numbers for this year, while two have done so for next year. Over the past 90 days, next year's estimates have increased 7.1% to 30 cents per share. This could rise in the wake of RSTO's better than expected second quarter. RSTO is currently trading at 23.7x next year's estimate of 30 cents per share. This is below the company's projected long-term growth rate of 29%, giving the stock a PEG ratio of 0.82. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. This important indicator is updated daily on Zacks.com and is available to Zacks Premium subscribers. 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| VitalStocks Home

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(NITE) - Knight Cap. Group - Beat the Street the past five quarters by a staggering average 79.5%

Knight Capital Group, Inc. (NITE), a Zacks #1 Rank stock, exceeded analysts' earnings expectations for the past five quarters by an average margin of 79.5%. NITE has a price-to-book ratio of 1.9, compared to 5.0 for the market. During the second quarter the company repurchased 1.4 million shares for approximately $23.4 million. Full Analysis Knight Capital Group, Inc. is a financial services firm providing comprehensive trade execution solutions and asset management services. The company was founded in 1995 under the name Knight/Trimark Group, Inc. It changed its name to Knight Trading Group, Inc. in 2000 and to Knight Capital Group, Inc. in 2005. When NITE exceeds analysts' earnings expectations, it usually does so by a rather large margin. Over the past five quarters in which the company beat the Street's estimate, its average margin of surprise was a staggering 79.5%. On Jul 19, NITE reported second-quarter profits of $30.3 million, or 29 cents per share. With analysts calling for 20 cents per share, the company topped estimates by an impressive 45.0%. Revenues ballooned 83.2% to $204.6 million, compared to $111.7 million for the second quarter of 2005. Chairman and Chief Executive Officer Thomas M. Joyce stated, “Knight has now completed four consecutive quarters of strong financial results, reflecting the critical changes to our business model that we began implementing one year ago.” During the second quarter, NITE finalized its acquisition of Hotspot FX, Inc. and also agreed to buy ValuBond, Inc. The $77.5 million Hotspot purchase enables NITE to have a subsidiary that provides institutions and dealers with spot foreign exchange trade execution through an advanced, fully electronic platform. ValuBond, Inc. is a privately held company that provides electronic access and trade execution products for the fixed income market. That purchase price was estimated at $18.2 million. NITE bought back 1.4 million shares for approximately $23.4 million during the second quarter. To date, the company has repurchased 39 million shares valued at $319 million under its current $495 million stock repurchase program. The company is currently trading at a valuation of 13.4x trailing 12-month earnings and at 13.6x current fiscal-year estimated earnings. The market, as represented by the S&P 500, is trading at a valuation of 16.4x trailing 12-month earnings and at 15.7x its current fiscal-year estimated earnings. NITE has a price-to-book ratio of 1.9, compared to 5.0 for the market. Its return on equity of 15% is in line with the industry average. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. This important indicator is updated daily on Zacks.com and is available to Zacks Premium subscribers. 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| VitalStocks Home

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(PCP) - Precision Castparts Corp. - Exceeding analysts' earnings expectations have become par for the course

Precision Castparts Corp. (PCP) topped analysts' earnings expectations in 14 straight quarters, most recently by 16.2% in the first quarter of fiscal 2007. Earnings per share for this Zacks #1 Rank stock are forecasted to grow 16% over the next 3-5 years. Consensus estimates have been on the rise and PCP's return on equity exceeds that of the industry average--19% compared to 12%. Full Analysis Precision Castparts Corp. manufactures complex metal components and products, investment castings, forgings and fasteners/fastener systems for aerospace and industrial gas turbine applications. Exceeding analysts' earnings expectations have become par for the course at PCP. The company topped the Street's estimate in 14 consecutive quarters. Earnings per share grew 10% over the past five years and are projected to grow by a greater magnitude going forward—-16% over the next 3-5 years. The industry in which PCP participates is expected to grow at a 15% clip. On Jul 25, PCP posted first-quarter fiscal 2007 profits of $118.0 million, or 86 cents per share, compared to $77.9 million, or 58 cents per share in the prior-year period. With analysts calling for 74 cents, the company surprised to the upside by a solid 16.2%. Revenues rose 31.3% to $1.12 billion from $853 million a year earlier. Chairman and Chief Executive Officer Mark Donegan stated, "The first quarter of fiscal 2007 was on target, and we look forward to another strong year. Every one of our core businesses contains abundant upside opportunities." Analysts' optimism has been growing. Consensus estimates for this quarter and next quarter have risen 8.6% and 7.1%, respectively, over the past 60 days. Profit forecasts for fiscal 2007 and fiscal 2008 increased 9.7% and 7.3%, respectively, over the past two months. While PCP's dividend yield may not be entirely impressive, it does exceed that of the industry average. The company is currently yielding 0.20%, while the industry's current dividend yield is 0.0%. Management has been extremely effective in building shareholder value, made clear by the company's return on equity of 19%. This is significantly higher than the industry's ROE of 12%. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. This important indicator is updated daily on Zacks.com and is available to Zacks Premium subscribers. 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| VitalStocks Home

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(INFY) - Infosys Technologies Ltd. - exceeded earnings estimates in 10 out of the past 13 quarters

Infosys Technologies is growing much faster than its industry. INFY has exceeded earnings estimates in 10 out of the past 13 quarters. Nine analysts have raised their estimates for this year, while five have done so for next year. Over the past two months, this year's estimates have risen 5.5% to $1.34 per share, while next year's numbers have increased 4.5% to $1.62 per share. Full Analysis Infosys Technologies Ltd. (INFY) is the second largest IT services company in terms of revenue in India, with a base of about 58,409 employees (as of June 30, 2006) around the globe. Headquartered in Bangalore, India, the company enables its clients to leverage its performance by utilizing its proprietary Global Delivery Model (GDM). The range of services offered by INFY includes consulting, development, re-engineering, maintenance, systems integration, and software package evaluation and implementation. It also designs software for the banking industry and offers business process management (BPM) services through its subsidiary Progeon, Ltd. The recent strong results from Infosys are the results of various initiatives taken over the last several years, as Infosys has been taking advantage of its GDM model to continue to grow faster than the industry. The Indian off shore IT services market has seen tremendous growth over the past five years, and there are reasons to believe this growth will continue into the foreseeable future. A vast pool of talented labor, an English-proficient population, and a competitive cost structure characterize this market. As the company is growing its revenues, it is growing less dependent on its top-ten clients, which comprise 31.7% of the company's revenues in the first quarter of 2007, down from 31.8% in the year-ago period. This diversification of revenues should help the company avoid any major mis-steps as it continues to expand at a rapid pace. On July 12, 2006, Infosys Technologies announced results for its first quarter of fiscal 2007 ended June 30, 2006. First quarter revenue was $660 million, up 38.7% from $476 million in the previous-year quarter, and up 11% sequentially, which was $30 million above our revenue estimate. Strong revenue growth in Europe, particularly the United Kingdom, and growth in its telecom business were some of the reasons for the higher revenues. INFY has exceeded earnings estimates in 10 out of the past 13 quarters. Nine analysts have raised their estimates for this year, while five have done so for next year. Over the past two months, this year's estimates have risen 5.5% to $1.34 per share, while next year's numbers have increased 4.5% to $1.62 per share. The stock is currently trading at 26.7x next year's estimate of $1.62 per share, slightly below the projected long-term growth rate of 27.88%, giving INFY a PEG ratio of 0.96. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. This important indicator is updated daily on Zacks.com and is available to Zacks Premium subscribers. 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| VitalStocks Home

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CNOOC Limited (CEO) - Global Investors (GROW) - Spear's Security Industry Analyst newsletter - Sampling of Stock Profiles

Gregory Spear, editor of the Spear's Security Industry Analyst newsletter, compares the East to the West. Learn about the economies of Eastern countries versus Western economies as Spear pits the Eastern team against the Western team in what this featured expert calls the global all-star game. Then take a look at a Chinese oil company as well as an investment advisory firm. Batter Up from August 18 In the global all-star game, the Eastern team has a plethora of fast-growing, producer-oriented economies, a fairly rich and stable resource base, plenty of long-term resource contracts with diverse global suppliers, a growing middle-class eager to raise their standard of living, cash-rich governments, a high personal savings rate, and most importantly, political stability. On the Western team we see mostly mature consumer-oriented economies, an aging population thinking about retirement and security, nations with high levels of debt, no cash savings and a resource base dependent on imports from numerous countries with extreme political instability or antipathy towards the U.S. Which team would you bet on? With respect to the Eastern team, the China Center for Economic Research in Beijing forecasts that the country's economy could grow at 9% per year for the next 20 years. That may sound like hyperbole, but this past week the World Bank raised its forecast for China's growth in gross domestic product (GDP) to 10.4% from 9.5%, the third time this year the bank raised its target. Meanwhile, India's state-owned oil company has joined with Sinopec (SHI), China's second-largest oil company by output, to buy half interest in an oil company in Columbia. In the past, these two giants have engaged in bidding wars, but Spear and his team interpret this new era of cooperation as an early sign of the emerging global split. Dissent in the Ranks What's the news from the Western team? Let's look at Venezuela. The country ranks 7th in the world in terms of reserves, provides 15% of US oil and we buy 60% of its production. Venezuela's President Hugo Chavez, however, hates the U.S. due to our support of coups against him, and he is taking aggressive steps to develop new long-term trading arrangements with China and India. Technicians from Iran are now assisting in resource development. As a result, Venezuela's oil shipments to the US declined about 6% in the first four months of the year. Meanwhile, over the next five years the national oil company, Petroleos de Venezuela, plans to buy more than a dozen large oil tankers to increase shipments to Asia. In the short-term, Chavez plans to triple exports to China by the end of this year. Also, keep in mind that Venezuelan oil production has declined 30% since 1970, so we can't even rely on our enemies. With respect to Iraq, the second largest conventional crude producer, the country is mired in a civil war and oil supplies are not secure. Iran can keep this pot simmering as long as it wants and as a holder of the world's third largest reserves, we can expect it to use that leverage when it is politically expedient to do so. The country is one of the largest suppliers to China and Spear would not rule out a selective embargo directed toward the West. Then there is Saudi Arabia. Despite massive government expenditures, oil output from the Saudis declined by 400,000 barrels per day over the past quarter. The Saudis are working to tap natural gas (gas to liquid technology) and “heavy” oil, but they appear to be maxed out. Meanwhile, total Canadian crude oil production has fallen since 2004, and will not pick up before the end of the decade. The fact that oil sands technology uses 2-4 times as much water as it produces in usable oil may ultimately impact the viability of that technology in North America, given the global warming situation and the resultant droughts. We may eventually need to build a pipeline for water from Canada. Imagine that. Summary In conclusion, the relationship between East and West is currently symbiotic, but the future of one team seems quite a bit brighter than that of the other. The East currently needs the West as primary consumers, but eventually the 2 billion souls just now leap-frogging into the 21st century from the 19th, will develop appetites of their own and an infrastructure to satisfy them. Eventually, many of them will be competing in the global marketplace for the very jobs, homes and services the West now has a monopoly on. The only rational approach is to realize that, if you can't beat ‘em, own ‘em. A Sampling of Stock Profiles: CNOOC Limited (CEO), the smallest of China's three state-owned oil companies, engages in the exploration, development and production of crude oil and natural gas in offshore China. CEO has the exclusive right to enter into production sharing contracts (PSCs) with international oil and gas companies and to acquire up to a 51% participating interest in any successful discovery in offshore China made by its foreign partners, and there are a lot of them, including ConocoPhillips, ChevronTexaco, BG, Devon and KerrMcGee. For 2005, the company reported net profit at $3.1 billion, up 57% on a 45% increase in revenue. CEO's total net daily production rose 10.5%, but even more impressive is the fact that the company replaced 185% of its reserves. At the end of the year, the ratio of total debt to capital was just 19%. Approximately one-third of profit was distributed as dividend. Shares pulled back in May from $90 to $66 on concerns about emerging market health, but have since snapped back to $91. Global Investors (GROW): If you are looking for a way to play the emerging markets, energy and precious metals you can invest in a variety of well-known companies listed on the NYSE. However, there may be more opportunity for capitalizing on undiscovered value in the grassroots plays, which is U.S. Global Investors' specialty. GROW is a boutique investment advisory firm and asset management company with 13 no-load mutual funds that cover the gamut, from mainstream U.S. equities to targeted emerging markets to bonds. The company also invests for its own account in an effort to add growth and value to its cash position and provides management services for various offshore clients. In other words, GROW is a hybrid and diversified investment operation that is half mutual fund, half hedge fund. What you are betting on when you invest in GROW is that these folks know how to trade. In Spear and his team's view, their track record backs up that assertion. Of course, being in the right place at a time when both emerging markets and precious metals experienced some bubble-like action does not mean that these folks are geniuses. But GROW was early to the precious metal and commodity party, which is one reason Spear and his trust their acumen. In February 1994, it launched the China Region Opportunity Fund, the first no-load fund dedicated to investing primarily in companies located in the China region. Content Courtesy: Zacks Investment Research | Blog Home| VitalStocks Home

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Eaton Corp. (ETN) - Garmin Ltd. (GRMN) - Invitrogen Corp. (IVGN) - Shortex newsletter - Sampling of Long Positions

Joseph Parnes, editor of the Shortex newsletter, discusses the market, the economy, the housing market, treasuries, the consumer and corporate earnings. Benefit from this featured expert's analysis of market trends. Then take a look at some of the longs profiled by Parnes. MARKET TREND from August 23 The market remains under pressure as weaker than expected indicators, the likes of housing data and rising bond yields overshadows the fall of oil prices. Perhaps the economy aiming at a soft landing is witnessing more unwanted elements risking a hard fall? The economy has notably declined manifested in 2nd Qtr GDP growth rate at 2.5% annual rate from a robust 1st Qtr of 5.6%. Uncertainty in the market place has created worries that may linger on into the coming months. The biggest risk is in the housing market where July existing home sale fell 4.1% to a 6.33 mil annual rate (the lowest level and rising inventory since Jan '04.) Apparent confirmation that higher interest rates are impacting economic growth, curtailing consumptions. Alas the Treasury Market does not seem to discount the negative date, rather reversing recent gains and hinting by lifting borrowing costs across the yield curve. Concern is being raised with rate sensitive issues with regard to valuation concerns amid the stability of growth oriented issues. The falling growth index by 1.4% (week ending Aug 11) has put Cos. in firm position to prepare for a slowdown, holding the line on hiring and maintaining low level of inventories. Consumers pulling back in spending may be reflective of their slower income growth and in many instances, the falling appreciation of their home equities and their inability to pay down their mortgages. A positive sign is reflective of corporate earnings enduring signs of strength, hoping that business spending will continue. Cash rich Cos. are operating near full capacity augmented with better business planning and global growth. The Fed's move to stand pat on raising interest rates for a 17 time may have reined in inflation without triggering a recession. A Sampling of Long Positions: Eaton Corp. (ETN) has diversified successfully away from automotive business into lucrative fields: aircraft hydraulics, factory automation/ fluid control and electrical equipments. Has generated very strong cash flow, and raised its quarterly dividend 13% to 35 cents per share. The electrical segment its big driver of operating profit and power and truck business could clear the road to its goal of $18 billion revenue by 2010. Garmin Ltd. (GRMN): The maker of a diverse family of handheld portable/fixed mounted global positioning system (GPS) split its stock two-for-one. Opening a walk-in-show room in Chicago (mile high profitable Michigan Ave). Attracting customers in today's high price of gasoline. Invitrogen Corp. (IVGN): The provider of products used in genetic research/drug production reported 2nd Qtr earnings up 32.2%. Gross margin increased 270 basis points to 60.8% and operating margin increased 75 basis points to 8.2%. With $1 billion of cash, announced a $500 mil share purchase program over the next three years. Opportunity to participate in new market, especially in the molecular diagnostic and bio defense to be noted. Content Courtesy: Zacks Investment Research | Blog Home| VitalStocks Home

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PepsiCo (PEP) - Nordstrom (JWN) - Nike (NKE) - Merrill Lynch (MER) - McDonald's (MCD) - Long-term Buy List - Dow Theory Forecasts newsletter

Richard Moroney, editor of the Dow Theory Forecasts newsletter, says it will likely take improvement in the price action of the Transports before the broad market can generate sustained upside action. Read this expert's market commentary and receive an update on oil prices as well as interest rates. Afterward, check out some of his Long-term Buy List. MARKET COMMENTARY The Dow Jones Industrial Average recently moved to its highest level in more than three months. However, the Dow Transports have been unable to muster much upside movement. It will likely take improvement in the price action of the Transports before the broad market can generate sustained upside action. Respite in oil prices, interest rates The Dow Industrials are trading just 3% below their May highs of 11,642.65. One positive factor for the market in recent weeks has been a relaxing in oil prices. The price of West Texas Intermediate crude recently fell to its lowest level in two months. To be sure, the decline has been fairly modest in absolute terms, and betting on a big decline in energy prices has been a fool's errand over the last 24 months. Still, oil has had difficulty holding onto highs after recent price spikes, so perhaps further softening is in the offing. Another positive development has been the break in interest rates. Yields on both the 10-year and 2-year Treasury bonds have declined in the last two months, and some market watchers are betting that rates will continue to fall. Strength in the traditionally rate-sensitive Dow Jones Utilities — the Utilities trade around all-time highs — is seen as another indicator of a softening rate environment. While the Industrials have been resilient, the same cannot be said for the Dow Transports. Indeed, the Transports trade at a hefty 14% discount to their May highs of 4998.95. The Transports are highly sensitive to economic conditions, and their lackluster performance raises the fears of an economic slowdown. Such a slowdown would likely take its toll on corporate profits. And that would be bad news for stock valuations. Thus, it remains imperative that the Transports begin to firm up. Conversely, further erosion in the Transports, especially a move below their recent low of 4141.62, would fuel fears of an economic slowdown and make it all the more difficult for the broad market to move substantially higher. Conclusion In order to reconfirm the stock market's bullish primary trend, the Dow Jones Industrials and Transports need to close above their respective May highs of 11,642.65 and 4998.95. However, with a close below 10,706.14 in the Industrials, the Dow Theory would switch into the bearish camp. For now, investors should maintain 5% to 15% cash positions. For new buying, Harris (HRS) has demonstrated good near-term price momentum and has attractive upside potential over the next 12 months. Long-term Buy List includes: McDonald's (MCD) develops, operates, franchises and services a worldwide system of restaurants that prepare, assemble, package and sell a limited menu of value-priced foods. The company operates primarily in the quick-service hamburger restaurant business. All restaurants are operated by the company or, under the terms of franchise arrangements, by franchisees who are independent third parties, or by affiliates operating under joint-venture agreements between the company and local business people. Merrill Lynch (MER) is one of the world's leading financial management and advisory companies with offices in numerous countries. The firm is a global underwriter and market maker of debt and equity securities and a strategic advisor to corporations, governments, institutions, and individuals worldwide. Nike's (NKE) principal business activity involves the design, development and worldwide marketing of high quality footwear, apparel, equipment, and accessory products. NIKE is the one of the largest sellers of athletic footwear and athletic apparel in the world. The company sells its products to retail accounts in the United States and through a mix of independent distributors, licensees and subsidiaries in numerous countries around the world. Nordstrom (JWN) is one of the nation's leading fashion specialty retailers, with stores located in a number of states, including full-line stores, Nordstrom Racks, Faconnable boutiques, and free-standing shoe stores. Nordstrom also operates Faconnable boutiques throughout Europe. Additionally, Nordstrom serves customers through its online presence and through its direct mail catalogs. PepsiCo (PEP) consists of: Frito-Lay Company, Pepsi-Cola Company, and Tropicana Products. PepsiCo brands are among the best known and most respected in the world and are available in countries and territories throughout the world. PepsiCo's success is the result of superior products, high standards of performance, distinctive competitive strategies and the high integrity of its people. Content Courtesy: Zacks Investment Research | Blog Home| VitalStocks Home

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