Zacks Bull and Bear of the Day Highlights: Marathon Petroleum, Vale, E. I. du Pont de Nemours, Dow Chemical and BASF

Zacks Bull and Bear of the Day Highlights: Marathon Petroleum, Vale, E. I. du
                    Pont de Nemours, Dow Chemical and BASF

PR Newswire

CHICAGO, Nov. 8, 2012

CHICAGO, Nov. 8, 2012 /PRNewswire/ --Zacks Equity Research highlights
Marathon Petroleum Corp. (NYSE:MPC) as the Bull of the Day and Vale S.A
(NYSE:VALE) as the Bear of the Day. In addition, Zacks Equity Research
provides analysis on E. I. du Pont de Nemours and Company (NYSE:DD), The Dow
Chemical Company (NYSE:DOW) and BASF SE (OTC:BASFY).


Full analysis of all these stocks is available at

Here is a synopsis of all five stocks:

Bull of the Day:

We are maintaining our Outperform recommendation on Marathon Petroleum Corp.
(NYSE:MPC). Spun out of parent Marathon Oil Co. in 2011, the company is a
leading refiner and marketer of petroleum products in the U.S.

Our bullish investment theme stems from Marathon Petroleum's scale advantage,
impressive asset quality, and an extensive midstream/retail network that
diversifies its portfolio and provides more stable revenue streams. We believe
management's recently commenced $2 billion share repurchase program and the
proposed acquisition of BP's Texas City refinery could further boost
shareholder value.

Marathon Petroleum's low debt ratio and hefty cash balance add to the positive
sentiment. All in all, we believe the company is well positioned going forward
and view it as an attractive investment.

Bear of the Day:

We are maintaining an Underperform recommendation on Vale S.A (NYSE:VALE)
based on the rising cost of raw materials, increasing price volatility and
demand slowdown, especially in China. Also, rising cost of delivery of
materials and the competition in the industry leaves the company in a pressure
to maintain prices as well as earn profits to sustain.

In the third quarter of 2012, earnings of the company fell by 66% year over
year and stood at $0.32 per ADR. The revenue was also reported 34.5% lower
year over year at $10,963 million due to weak macro conditions.

We are maintaining our Underperform recommendation on Vale based on demand
degradation for metals and minerals, especially in the company's main region
of operation, China. We expect Vale ADR to trade at a P/E of 7.1x EPADR 2012,
to arrive at the target price of $17.00.

Latest Posts on the Zacks Analyst Blog:

Earnings Scorecard: DuPont

Earnings estimates for E. I. du Pont de Nemours and Company (NYSE:DD) are on
the downswing following its lackluster third-quarter 2012 results. The
Delaware-based chemical and industrial products behemoth missed estimates in
the quarter and its profit tumbled due to lower demand across titanium dioxide
and photovoltaic markets. DuPont reduced its earnings forecast for 2012 and
announced a restructuring plan that includes headcount haircuts.

Third Quarter Revisited

DuPont logged consolidated adjusted earnings of 44 cents a share in the third
quarter, a roughly 36% decline from the year-ago earnings of 69 cents.
Including one-time items, earnings came in at a penny per share, a roughly 98%
plunge from 48 cents registered in the prior year quarter.

Adjusted earnings from continuing operations (excluding the divestiture of
Performance Coatings business) were 32 cents per share. The results missed the
Zacks Consensus Estimate of 46 cents.

Revenues from continuing operations declined 9% year over year to $7.4
billion, due to lower sales volumes, negative currency impact and reduction
from portfolio changes, partly offset by higher pricing. Sales missed the
Zacks Consensus Estimate of $8.08 billion. The company saw lower sales volumes
from its Electronics and Communications and Performance Chemicals businesses,
especially in Asia Pacific.

DuPont slashed its earnings forecast for 2012 and now expects earnings from
continuing operations (excluding significant items) to be in the band of $3.25
to $3.30 per share. Earlier, it expected earnings to be at the lower end of
its guidance range of $4.20 to $4.40 a share.

We have discussed the quarterly results at length here: DuPont Profit Skids,
Slashing Jobs.

Agreement – Estimate Revisions

Estimates for DuPont manifest an absolute downward drift, reflecting its
dismal third quarter results and reduced outlook. Out of 14 analysts covering
the stock, 12 have chopped their estimates for the fourth quarter over the
past 30 days while none moving in the opposite direction. No movement was
witnessed over the past 7 days.

Estimates for 2012 also elicit bearish sentiment with 6 analysts (out of 11)
lowering their forecasts over the past month with no reverse movements. No
activity was witnessed over the last week.

Magnitude – Consensus Estimate Trend

Given the strong directional pressure from a string of downward revisions,
estimate for the fourth quarter dropped by 33 cents over the past month (to 9
cents a share) while remaining static over the past week. On a similar note,
estimate for 2012 slipped by 67 cents (to $3.34 a share) over the past 30 days
and remained stationary over the past 7 days.Our View

DuPont is a global chemical and life sciences company with a diverse array of
product offerings. The company has adopted aggressive acquisition and joint
venture strategies to facilitate its transformation from an industrial
chemical maker to one that has diversified businesses ranging from bulletproof
vests to solar panel films.

DuPont is witnessing significant momentum in the agriculture business, boosted
by higher volume and market share gains in seed genetics and crop protection.
Moreover, the acquisition of Danisco has strengthened its presence in the food
ingredient and enzyme markets while expanding its foothold in industrial
biotechnology and biofuels.

The company is focused on an aggressive cost-cutting strategy which involves
headcount reductions, restructuring of work schedules and improvement of
working capital productivity. As part of its newly announced restructuring
program, it plans to lay off 1,500 workers across the globe over the next 12
to 18 months and expects to save about $450 million from the move.

However, barring agriculture and nutrition, DuPont witnessed weakness across a
number of businesses in the third quarter. Lower demand for photovoltaic
materials led to a sharp decline in sales in its Electronics and
Communications segment.

Moreover, the demand of titanium dioxide, which is used to give paint and
other coatings a white hue, remained weak due to the challenging economic
conditions in Europe and softness in some parts of Asia, leading to lower
volumes in the Performance Chemicals segment. The company's downward guidance
revision for the full year reflects the sustained weakness across these two
businesses and expected sequential lower profits from these units in the
fourth quarter.

DuPont also remains exposed to raw material cost inflation, which is expected
to constrict its margins in the fourth quarter. Moreover, currency headwinds
weighed on the performance of a number of segments in the third quarter and
are expected to reduce its earnings for 2012 by 27 cents a share.

DuPont, which competes with The Dow Chemical Company (NYSE:DOW) and BASF SE
(OTC:BASFY), holds a short-term Zacks #4 Rank (Sell). We currently have a
long-term (more than 6 months) Underpeform recommendation on its shares.

Get the full analysis of all these stocks by going to

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