The Zacks Analyst Blog Highlights:AT&T, Apple, Verizon Communications, PulteGroup and Lennar

    The Zacks Analyst Blog Highlights:AT&T, Apple, Verizon Communications,
                            PulteGroup and Lennar

PR Newswire

CHICAGO, Dec. 31, 2012

CHICAGO, Dec. 31, 2012 /PRNewswire/ 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 AT&T Inc.(NYSE:T),
Apple(Nasdaq:AAPL), Verizon Communications(NYSE:VZ), PulteGroup
Inc.(NYSE:PHM) and Lennar Corporation(NYSE:LEN).


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Here are highlights from Friday's Analyst Blog:

AT&T Expands Mobile Internet
AT&T Inc.(NYSE:T) is expanding its mobile Internet coverage for customers in
South Florida. The company is experiencing strong momentum in its wireless
business driven by demand for data services. We expect the company's expansion
plans in this space to strengthen its foothold in data services as well as
generate incremental revenues.

The expansion will involve capacity enhancement in cell sites in order to
improve mobile data traffic and voice connectivity. The company boasts the
best Internet speeds in the industry as it is the only U.S. carrier that
provides 4G networks through both Long Term Evolution (LTE) and High-Speed
Packet Access Plus (HSPA+) technologies.

AT&T initially rolled out LTE networks late last summer that went on to become
the benchmark of mobile technology and the life-blood for operators across the
world. AT&T's 4G LTE service is currently available in 103 markets with more
than 150 million users in the U.S.

The telecom giant aims to reach about 250 million people by 2013-end and 300
million by the end of 2014. To support its 4G LTE services, the company offers
several 4G LTE smartphones and tablets, which include HTC One X, Samsung Smart
PC, Nokia Lumia 900, LG Optimus G and ASUS Vivo Tablet. In addition, during
the third quarter, AT&T was the highest selling iPhone 5 carrier-partner

We expect AT&T to continue this trend as it is aggressively expanding its 4G
LTE coverage. Additionally, the company's new Mobile Share plans, which allow
connecting more than one device to its data plan, will further boost sales of
the new iPad as it will cost only $10 per month to connect the new mini iPad
to its new data sharing plan. However, we believe that persistent access line
losses, competitive pressure from peers likeVerizon Communications(NYSE:VZ)
and heavy iPhone subsidies might drag near-term margins and earnings.

AT&T Inc. has a Zacks #3 Rank, implying a short-term (1–3 months) Hold rating
on the stock. For the long-term, we have a Neutral recommendation on the

PulteGroup on a Tight Rope
We have maintained our Neutral recommendation onPulteGroup Inc.(NYSE:PHM)
appraisal of the third quarter results.

PulteGroup's third quarter 2012 adjusted earnings of 27 cents per share beat
the Zacks Consensus Estimate by 35%. Earnings were significantly better than
the adjusted earnings of $11 cents in the prior-year quarter, driven by
improved home demand and pricing, gross margin expansion and solid overhead
leverage. Pulte's homebuilding revenues rose 12.7%, driven by an increase in
new home orders and average selling prices.

New home orders were up 27% year over year based on the improvement in new
home demand. The average selling price rose 5% as Pulte raised prices in
almost 70% of its markets in the quarter. The company is seeing a definite
improvement in demand in the homebuilding sector and believes its cost
reduction and operating efficiency improvement plans will lead to
profitability for the remainder of 2012.

With a gradual recovery in the overall economy, the homebuilding industry is
finally seeing signs of stabilization in 2012. The overall U.S. housing market
has seen a meaningful increase in the volume of new home sales for the first
nine months of 2012 with industry-wide sales tracking roughly 25% above
prior-year levels. We believe that the housing market is starting to benefit
from an increase in employment rates, higher consumer confidence and several
years of pent-up demand. Houses are more affordable now as mortgage loans come
with record low interest rates, while renting has become more expensive.
Homebuilders like Pulte with significant land positions, broad geographic and
product diversity, and better capital positions are expected to benefit the
most as market conditions recover.

The company is continuously evaluating its assets and prioritizing markets and
projects in order to allocate capital appropriately and to invest selectively
in high return projects. The company is divesting lower margin projects and
exiting non-performing communities and lower margin land lots, which no longer
fit into their operating strategy, thus freeing up cash to invest in other
potential opportunities, which could generate higher returns. Pulte is also
utilizing its existing land assets more efficiently and lowering its unsold
inventory levels more aggressively, which in turn are benefiting the working
capital and margins. Moreover, while the company monetizes non-profitable
existing assets, it is disciplined in adding new land positions. The company
is also shifting its focus toward steeply priced Pulte branded move-up homes,
which will likely improve the overall average selling prices.

In addition to allocating capital more efficiently, Pulte is taking other
actions to improve its operating and financial performance. These initiatives
include improvement of overhead leverage and implementing new pricing
strategies. These initiatives will better place the company when the housing
conditions improve in the long term.

Though the housing market is showing signs of stabilization in 2012,
management believes that the process is erratic and not yet adequately
broad-based. A speedy housing recovery is unlikely and the timing of the
markets to fully recover and return to a more historically typical operating
environment is uncertain.

Pulte carries a Zacks #2 Rank (short-term Buy rating). Peer company,Lennar
Corporation(NYSE:LEN) also carries the same rank, thus highlighting the
positive momentum in the housing industry.

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