The Zacks Analyst Blog Highlights: Target, Wal-Mart Stores, Amazon.com, Costco
Wholesale and Quest Diagnostics
CHICAGO, Oct. 23, 2012
CHICAGO, Oct. 23, 2012 /PRNewswire/ --Zacks.com announces the list of stocks
featured in the Analyst Blog. Every day the Zacks Equity Research analysts
discuss the latest news and events impacting stocks and the financial markets.
Stocks recently featured in the blog include Target Corporation (NYSE:TGT),
Wal-Mart Stores Inc. (NYSE:WMT), Amazon.com Inc. (Nasdaq:AMZN), Costco
Wholesale Corporation (Nasdaq:COST) and Quest Diagnostics (NYSE:DGX).
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Here are highlights from Monday's Analyst Blog:
Target to Open More Stores
In an effort to further strengthen its operational roots, Target Corporation
(NYSE:TGT), the operator of general merchandise and food discount stores in
the United States, announced the opening of 3 new stores in Chicago, New York
and San Francisco.
The move reflects the company's strategic initiative to expand in regions
where it generates strong sales. Moreover, the San Francisco store is the
extension of its smaller-format stores called CityTarget.
Target Corporation, in order to tap the urban markets where real estate
remains a constraint, plans to introduce smaller-format stores called
CityTarget, similar to that of its biggest rival, Wal-Mart Stores Inc.
Earlier, the company unveiled its first three smaller format stores in Los
Angeles, Seattle and Chicago. We believe that the approach will help the
company to augment its sales by enhancing its accessibility to the country's
thickly populated urban regions and space-crunched cities.
The company has announced its plan to open 10 Target stores in 2013, which
includes the smaller format stores in Los Angeles, Portland and San Francisco.
Moreover, the company for the first time announced that it will allow its
shoppers to match the prices being offered by online retail giants. Consumers
will have the facility of compare prices being offered by Amazon.com Inc.
(Nasdaq:AMZN), Wal-Mart Stores Inc.'s Walmart.com, Best Buy Co. Inc.'s
BestBuy.com and Toysrus.com.
According to the price matching policy, the customer will not find any
discrepancy in pricing if an item is purchased between November 1^st and
December 24^th from Target stores. However, if the item costs less at
Target.com or in a local competitor's printed ad, Target will provide items
matching the price.
Currently, we have a long-term 'Neutral' rating on the stock. However, the
company, which competes with Costco Wholesale Corporation (Nasdaq:COST), holds
a Zacks #2 Rank, which translates into a short-term 'Buy' rating.
DGX to Buy UMass Medical Center
Leading diagnostic tester Quest Diagnostics (NYSE:DGX) is keeping at par with
its Merger and Acquisition (M&A) strategy which the company expects to remain
as its key driver of growth. Recently as part of this strategy, the company
teamed up with Central New England's largest health care system UMass Memorial
Health Care to purchase its UMass Memorial Medical Center.
Although financial terms of this definitive purchase agreement were not
disclosed, Quest Diagnostics expects the transaction to be completed in the
next 3 months, subject to certain customary regulatory clearance. The
diagnostic testing stalwart expects the incorporation of UMass Memorial
Medical Center to add 1% to the company's consolidated revenues in the next
fiscal with no bottom-line impact. However, the company expects this
transaction to be accretive to its earnings per share (EPS) in fiscal 2014.
Quest Diagnostics expects this acquisition to establish a long-term
relationship between the two organizations. The plan states that Quest
Diagnostics' full-service laboratory in Cambridge and its Athena Diagnostics
specialty neurology testing subsidiary in Worcester will be moved to a
centrally located new facility in Massachusetts.
The company expects this facility, after being fully operational in next 18–24
months, to perform the testing currently performed at UMass Memorial's
Worcester-based outreach laboratories as well as Quest Diagnostics' Cambridge
Per the plan, UMass Memorial will be taking a financial stake in the new
entity that would develop and operate a leading-edge laboratory in
Massachusetts in the future. Both the organizations expect this advanced
laboratory service to include a number of benefits like higher quality
service, expanded information connectivity options, and reduced laboratory
Quest Diagnostic believes that the impending acquisition is in sync with its
goal to create the company's planned 'lab of the future' which will help it
increase long-term growth opportunities and increase shareholders' value.
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