Zacks Bull and Bear of the Day Highlights: Hibbett Sports, Intel, Zumiez, Hot
Topic and Pacific Sunwear of California
CHICAGO, Oct. 25, 2012
CHICAGO, Oct. 25, 2012 /PRNewswire/ --Zacks Equity Research highlights
Hibbett Sports, Inc. (Nasdaq:HIBB) as the Bull of the Day and Intel
Corporation (Nasdaq:INTC) as the Bear of the Day. In addition, Zacks Equity
Research provides analysis on Zumiez Inc. (Nasdaq:ZUMZ), Hot Topic Inc.
(Nasdaq:HOTT) and Pacific Sunwear of California Inc. (Nasdaq:PSUN).
Full analysis of all these stocks is available at
Here is a synopsis of all five stocks:
Bull of the Day:
Backed by strong sales growth coupled with operational efficiencies, Hibbett
Sports, Inc.'s (Nasdaq:HIBB) earnings of $0.30 per share for second-quarter
fiscal 2013 surged 42.9% from the prior-year quarter, beating the Zacks
Consensus Estimate of $0.27. Buoyed by better-than-expected results, the
company raised its expectations for fiscal 2013.
The company now forecasts earnings in the range of $2.57-$2.67 per share, up
from $2.50-$2.65 forecasted earlier. Management also remains committed to
expand its store network by 55 to 60 new stores in fiscal 2013. Moreover,
Hibbett's sharp focus on mid-sized and smaller markets and strategic mix of
branded as well as localized merchandise provide it with an edge over its
The company has a healthy balance sheet with no debt. Currently, we are
maintaining a long-term Outperform recommendation on the stock.
Bear of the Day:
We have downgraded Intel Corporation (Nasdaq:INTC) shares from Neutral to
Underperform following the company's lowered expectations for the next
quarter. We think that weakness in mature markets, economic headwinds in some
emerging markets and pressure from tablets and other competitors are taking a
toll on the company.
We think current trends overshadow Intel's $0.04 positive surprise versus the
Zacks Consensus in the second quarter that was driven by strength in server
and software businesses and supported by a moderate PC business. However, we
remain positive about Intel's dominance in the high-margin server segment and
promise of success in the mobile segment, although competition from ARM-based
devices continues to intensify.
We believe that Ultrabooks and Win-8 are wild cards this holiday season and
could skew results either way. We are also lowering our target price to
$20.00, which is 9.4X our earnings expectations for 2012.
Latest Posts on the Zacks Analyst Blog:
Zumiez Downgraded to Neutral
We have downgraded our long-term recommendation on Zumiez Inc. (Nasdaq:ZUMZ)
to Neutral. Our view is based on the company's declining comparable store
sales transaction in fiscal 2012 so far, except in May.
We observed that the company's rate of upside in comparable-store sales has
been decelerating. It increased in the mid double-digit to low double-digit
range between February and May (14.2% to 10.1%), but from June to September
the comps portrayed an upside between high-single digit to low-single digit
(8.2% to 3.7%). Therefore, considering this downward trend, we remain
apprehensive about the company's future comparable store sales performances.
Further, the sporting goods retail industry is a consumer-driven industry, and
hence is very sensitive to the health of economy as sports are mainly a
leisure activity. Spending on sporting goods is heavily dependent on personal
disposable income of consumers. The current macroeconomic challenges such as
high household debt and unemployment levels may restrain consumers spending on
However, continuing with its store expansion and e-commerce strategies, Zumiez
posted better-than-expected quarterly results for the second quarter of
2012.The quarterly earnings of 17 cents per share doubled year over year. Net
sales grew 20.4% during the quarter. Management now anticipates revenue
between $181 million and $185 million and earnings in the band of 42–45 cents
per share for the third quarter.
The company is currently in the early phase of its store expansion program and
plans to augment its network to 600–700 stores in the long run. Further, the
recent acquisition of Blue Tomato facilitates Zumiez to tap the European
market. We believe these initiatives provide the company with a solid platform
to effectively capitalize on the emerging opportunities.
The above pros and cons justify our long-term view on the company. Currently,
Zumiez competes with other teenage-focused retailers as well as sporting goods
retailers Hot Topic Inc. (Nasdaq:HOTT) and Pacific Sunwear of California Inc.
Get the full analysis of all these stocks by going to
About the Bull and Bear of the Day
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