The Zacks Analyst Blog Highlights:Kohl's, Actavis, Amgen, Mylan and Pernix
CHICAGO, Feb. 1, 2013
CHICAGO, Feb. 1, 2013 /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 Kohl's Corporation (NYSE:KSS),
Actavis, Inc. (NYSE:ACT), Amgen (Nasdaq:AMGN), Mylan (Nasdaq:MYL) and Pernix
Therapeutic Holdings, Inc. (Nasdaq:PTX).
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Here are highlights from Thursday's Analyst Blog:
Kohl's Downgraded to Underperform
On Jan 28, we downgraded specialty departmental store Kohl's Corporation
(NYSE:KSS) to Underperform due to weaker-than-expected holiday season sales,
which also forced the company to reduce its earnings expectation for the
fourth quarter and fiscal year 2012.
Why the Downgrade?
Kohl's performance during the holiday season was impacted by unfavorable
weather conditions and lower consumer confidence, which forced Kohl's to give
more than expected discounts to its customers. This was reflected in Dec
comparable store sales, which were lower than the company's expectations.
Notably, the company's Nov sales were also below expectations.
The sluggish sales also prompted the company to slash its expectations for the
fourth quarter and fiscal year 2012. The company has reduced its earnings
expectation to a range of $1.60 to $1.62 for the fourth quarter and $4.11 to
$4.13 for fiscal 2012 versus its previous guidance of $2.00 to $2.08 for the
fourth quarter and $4.52 to $4.60 for fiscal 2012.
Estimates for Kohl's have been declining ever since it reported its Dec
comparable sales. The Zacks Consensus Estimate for fiscal 2012 has gone down
7.0% to $4.13 per share over the last 30 days, while the Zacks Consensus
Estimate for fiscal 2013 declined 6.1% to $4.58 per share over the same
timeframe. With the Zacks Consensus Estimates for both fiscal 2012 and 2013
going down, the company now has a Zacks Rank #5 (Strong Sell).
Actavis Provides 2013 Guidance
Actavis, Inc. (NYSE:ACT), formerly known as Watson Pharmaceuticals, Inc.,
recently provided an update on its 2012 performance, 2013 outlook and
The company said that it expects 2012 earnings on the higher end of its
previously issued guidance range of $5.85 to $5.95, up 25% from 2011. 2012
revenues are expected to increase 29% to about $5.9 billion. We note that the
Zacks Consensus Estimate of $5.94 per share is already on the higher end of
the guidance range.
Actavis expects to earn $7.70 - $8.10 per share on total revenues of about
$8.1 billion in 2013. During 2013, the company expects low single-digit
pricing erosion in the US and mid single-digit percentage price erosion in
ex-US markets. Actavis said that it still expects cost synergy savings of $100
million in 2013 mainly from SG&A, R&D and raw material costs.
Actavis Pharma, the company's global generics business, is expected to post
revenues of $6.3 billion - $6.5 billion in 2013. Actavis is the third largest
player in the global generics market and has a presence across 62 countries.
The company intends to launch its generic version of Pulmicort Respules in the
second quarter of 2013. While the company expects an additional competitor for
generic Concerta to enter the market in 2013, it does not except any
competition for its generic versions of Lidoderm and Adderall XR until 2014.
Actavis' global brands business, Actavis Specialty Brands, is slated to post
revenues of $550 million - $600 million in 2013. Products like Rapaflo,
Generess FE, the Crinone franchise and the recently completed Uteron
acquisition should help drive revenues. The company is also working on the
development of biosimilars in collaboration with Amgen (Nasdaq:AMGN).
The Anda Distribution segment is expected to post revenues of $1.0 billion -
While revenue guidance was in line with expectations, earnings guidance was
below expectations with the Zacks Consensus Estimate standing at $8.20 per
share. One of the factors behind this is the entry of an additional competitor
for generic Concerta. We believe the company should be able to achieve its
guidance easily. With fewer major patent expiries slated to occur in the next
few years, we are encouraged by Actavis' focus on building its branded and
Actavis currently carries a Zacks Rank #3 (Hold). Other generic players like
Mylan (Nasdaq:MYL) and Pernix Therapeutic Holdings, Inc. (Nasdaq:PTX)
currently look better positioned. These companies carry a Zacks Rank #2 (Buy).
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