Jefferies' Updates 6/3
Jefferies initiated coverage of Cisco Systems (NASDAQ: CSCO) with a Hold rating. At the same time, Jefferies put its price target on the company's stock to $15.75.
In a research report published today, Jefferies states, "We believe it's too early for investors to commit to the stock as we're still in the very early innings of a potential turnaround." On Thursday, Cisco closed at $16.25.
Ensco (NYSE: ESV) had its rating and price target maintained at Buy and $67.
The report states, "With the Pride (PDE) merger complete, ESV is now positioned as the 2nd largest offshore driller in the world, with significant leverage to improving UDW floater and jack-up fundamentals. ESV remains one of our favorite offshore drillers due to its attractive earnings leverage and NAV growth over the next three years." On Thursday, Ensco close at $55.30. Its shares lost 1.81% in today's pre-market trading, however, to stand around $54.30.
Jefferies initiated coverage of Sagent Pharmaceuticals (NASDAQ: SGNT) with a Buy rating and a price target of $31.
The report states, "Sagent is one of a few standalone generic injectables companies, and given high barriers to entry and limited competition, has compelling scarcity value. With a low-cost business model that should support significant future margin expansion, one of the industry's largest pipelines, and a management team with a track record of success, we initiate coverage at a Buy and $31 PT." On Thursday, Sagent closed at $25.43.
Avanir Pharmaceuticals (NASDAQ: AVNR) had its rating maintained at Hold and its price target left unchanged at $3.50.
The report states, "We are assuming coverage of AVNR with a $3.50 price target and a Hold rating. AVNR markets Nuedexta, a low-dose combination of dextromethorphan (DM) and quinidine (Q), for pseudobulbar affect (PBA), a disorder of laughing or crying that can accompany neurological disease. While the market is large, initial sales have been slow and signal significant physician and patient education is needed." On Thursday, Avanir closed the day at $4.50. Its shares lost some ground in today's pre-market trading session, however, falling 2.22% to $4.40.
Jefferies initiated coverage of the Finish Line (NASDAQ: FINL) with a Buy rating and a price target of $28.
The report states, "A strong product cycle across multiple brands and large categories is leading Finish Line to post record-breaking results. After years of distractions, management is now intently focused on the core business and is capitalizing on the opportunity. We see EPS upside fueled by ongoing category momentum, operating leverage and more aggressive share repurchases." On Thursday, the Finish Line closed the day at $21.88.
Jefferies initiated coverage of Nike (NYSE: NKE) with a Buy rating and a price target of $100.
The report states, "We like Nike for its dominant global market leadership position in an athletic category that has both cyclical and secular tailwinds. Other attributes of note include a $4 billion net cash balance, a home-grown management team, and sizable emerging market exposure. Gross margin headwinds are a near-term drag but now appear priced in and poised to positively inflect 6-9 months from now." On Thursday, Nike's shares closed the day at $81.15.
Canadian Solar (NASDAQ: CSIQ) had its rating reiterated at Hold and its price target maintained at $14 after Jefferies held meetings with the company's management.
The report states, "We held meetings with Canadian Solar management Andrew Chen, CFO, and Ed Job, Director of Investor Relations. Management discussed potential ASP declines in 2Q. However lower input costs could allow good margin. We are hosting meetings with CSIQ at Intersolar next week." On Thursday, Canadian Solar closed the day at $9.55. In today's pre-market trading, its shares lost 0.52% of their value to trade around $9.50.
Jefferies initiated coverage of V.F. Corporation (NYSE: VFC) with a Hold rating and a price target of $100.
The report states, "We like VF's global portfolio strength, seasoned management team, and balance of growth and cash flow, but we recommend a better entry point given the uncertainty around both the net effect and duration of a rising product cost environment." On Thursday, V.F. Corporation closed the day at $95.87. Its shares lost 0.57% of their value in today's pre-market trading, however, to stand around $95.32.
Jefferies initiated coverage of Foot Locker (NYSE: FL) with a Hold rating and a price target of $25.
The report states, "FL is riding a powerful running and basketball sneaker trend with margins in an upward trajectory against a tight expense and inventory backdrop. Cost inflation seems manageable, while a 3% dividend yield and share repurchases provide valuation support. Nevertheless, a looming NBA lockout creates uncertainty, leaving us on the sidelines until a new collective bargaining agreement is reached." On Thursday, Foot Locker closed the day at $23.87. Its shares lost 0.46% in today's pre-market trading to stand around $23.76.
QuickSilver (NYSE: ZQK) had its rating reiterated at Buy.
The report states, "Results came in above expectations with Americas and Europe outperforming while Asia-Pac was hurt by the Japanese (5% of sales) disaster midway through the quarter. Perhaps the most encouraging data point was an accelerating 23% U.S. comp against tougher sequential comparisons. We believe a positive sales inflection is imminent which could trigger an upgrade cycle (we are 1 of 2 buy ratings out of 10 covering analysts)." At the moment, Jefferies has a price target of $5.50 on the company's stock. On Thursday, Quicksilver closed the day at $5.50. Its shares put a very strong performance in today's pre-market trading, however, rising 8.45% to $4.75.
Dominion Resources (NYSE: D) had its price target raised to $48.50 from $48. At the same time, its rating was left unchanged at Hold.
The report states, "We increase our 2012 and 2013 earnings estimates based on improving commodity prices. Dominion Resources merchant contribution now expected to be flat in 2012 versus 2011." On Thursday, Dominion closed the day at $47.27.
Synovus Financial Corporation (NYSE: SNV) had its price target reduced to $2.80 from $3 after Jefferies had a meeting with the company's management.
The report states, "We walk away from the management meetings feeling better about credit and cost saves, but more concerned about loan growth. Longer-term fundamental improvement is contingent on the company transforming itself to a commercial lender from CRE; a challenging undertaking which will take time. We are lowering our 2013 EPS estimate to $0.28 (from $0.30) on slower developing loan growth. Our price target goes to $2.80 (from $3)."
Amarin Corporation (NASDAQ: AMRN) had its rating reiterated at Buy.
The report states, "A competitor has raised questions raised over the validity of the statistical analyses used in the MARINE and ANCHOR studies, but for reasons we outline below, we remain positive on the statistical analysis plans and the eventual AMR101 commercial label. We continue to believe in a multi-billion market opportunity for AMR101. AMRN remains one of our top biotech picks." At the moment, Jefferies has a price target of $25 on the company's stock. Amarin is currently trading around $18.13, or 2.1% below yesterday's close.
Insulet Corporation (NASDAQ: PODD) had its rating reiterated at Buy after the company acquired its rival Neighborhood Diabetes.
The report states, "Insulet acquired privately-held Neighborhood Diabetes, a diabetes supply company, for $63mn. While the acquisition should provide some expanded back office, billing, and distribution capabilities and will allow Insulet to increase the revenues it generates from its customers, the slower growth, lower margin business model of Neighborhood is notably different from the high growth, margin expansion that has characterized PODD to date." Jefferies currently has a price target of $19.52 on the company's stock. At the moment, Insulet is trading around $19.52, or 0.33% below yesterday's close.
Cyberonics (NASDAQ: CYBX) had its rating reiterated at Buy in spite of a reduction in earnings per share estimates for the company.
The report states, "FQ411 saw a slight miss on revenues and earnings $0.03 shy of estimates. International sales also remain under pressure, although this is less unexpected than the slower first time implants. The company believes that de novo implants were better than that suggested by the proxy of lead sales, but the numbers are what they are and a slowing in new implants, should it be indicative of a trend, is concerning." Jefferies currently has a price target of $37 on the company's stock. Cyberonics is currently trading around $29.18, or 0.45% above yesterday's close.
UTi Worldwide (NASDAQ: UTIW) had its rating unchanged at Hold after the company reported its quarterly earnings in line with market expectations.
The report states, "UTIW reported a generally in-line quarter with generally favorable underlying industry trends, albeit increased spending on transitional initiatives. The focus going forward will be on the upcoming analyst day, which should provide further insight into the timing and benefits of these ongoing initiatives." At the moment, Jefferies has a price target of $23 on the company's stock. UTi is currently trading around $20.88, or 2.55% below yesterday's close.
Joy Global (NASDAQ: JOYG) had its rating reiterated at Hold in spite of an upward revision in the company's earnings per share estimates.
The report states, "Solid F2Q; guidance raised by the 2Q beat. We continue to expect mining capital spending to increase 20% in 2011, following a 30% increase in 2010. Revised targets of $4.1-$4.3B in revenues and EPS of $5.30-$5.60 vs. consensus of $4.1B and $5.33, respectively (excluding LeTourneau)." At the moment, Jefferies has a price target of $95 on the company's stock. Joy is currently trading around $90.09, or 0.47% below yesterday's close.
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