Affymetrix, Advanced Emissions Solutions, Vanguard European Stock Index, T.
Rowe Price European Stock and Henderson European Focus A highlighted as Zacks
Bull and Bear of the Day
CHICAGO, Sept. 3, 2013
CHICAGO, Sept. 3, 2013 /PRNewswire/ --Zacks Equity Research highlights
Affymetrix (Nasdaq:AFFX-Free Report) as the Bull of the Day and Advanced
Emissions Solutions (Nasdaq:ADES-Free Report) as the Bear of the Day. In
addition, Zacks Equity Research provides analysis ontheVanguard European Stock
Index (Nasdaq:VEURX-Free Report), T. Rowe Price European Stock
(Nasdaq:PRESX-Free Report) and Henderson European Focus A (Nasdaq:HFEAX-Free
Here is a synopsis of all five stocks:
Bull of the Day:
As a result unexpectedly strong second quarter, earnings estimates have been
rising for Affymetrix (Nasdaq:AFFX-Free Report), sending the stock to Zacks
Rank #1 (Strong Buy) and an 'Outperform' recommendation.
Headquartered in Santa Clara, California, Affymetrix is a leading provider of
microarray-based products and services to the global research community. The
company utilizes its DNA chip technology in areas of gene expression,
analysis, and clinical application to help treat infectious diseases, cancer,
and other ailments.
Affymetrix has 1,100 employees globally and has a sales and distribution
network across U.S., Latin America, Europe and Asia.
On July 31, 2013, the company reported its second quarter operating results.
The quarter resulted in net income of $2.8 million or $0.04 per diluted share,
compared to a net loss of $1.2 million or $0.02 per diluted share in the same
quarter of 2012. The results were substantially better than the Zacks
Consensus Estimate of a loss of $0.01 per share. The company reported earnings
for the first time since the first quarter of 2011.
Thanks to stronger revenue and control of operating expenses, the company
generated $10.3 million in cash from operations. Further they also reduced
their senior-secured debt by about 25%. As a result, the company ended the
quarter with $44 million cash-on-hand.
Bear of the Day:
Weak results have led to sharp downward estimates revisions, sending Advanced
Emissions Solutions (Nasdaq:ADES-Free Report) to a Zacks Rank # 5 (Strong
Headquartered in Colorado, ADES develops, offers, and implements proprietary
environmental technologies and provides equipment and specialty chemicals that
enable coal-fueled power plants to meet emissions regulations. It operates in
three principal business segments: Refined Coal, Emissions Control and CO2
ADES reported its second quarter FY 2013 results on August 7, 2013. The
quarter resulted in a net loss of $3.2 million or $0.32 per share compared to
a net loss of $1.3 million or $0.13 per share for 2012.The results were
substantially worse than the Zacks Consensus Estimate of $0.14 per share.
The Management said that while they were pleased with the continued success in
Emission Control business, they were disappointed by the delays in the Refined
Coal business that saw the closing of the lease contracts for two of their
facilities slip into the third quarter of 2013.
Due to disappointing results and uninspiring guidance, quarterly and annual
estimates have been revised sharply downwards in the past few weeks. Zacks
consensus estimates for the current quarter and year are now in the negative
territory—($0.11) and ($0.26) per share respectively, down substantially from
$0.58 and $1.65 per share, 60 days ago.
The company has missed estimates in each of the past four quarters, with an
average negative surprise of 548.72%.
Bet on Europe with These 3 Mutual Funds
Data released this month showed that the Eurozone has grown for the first time
since the third quarter of 2011. GDP for the 17-nation economic union
increased by 0.3%, according to data released this month. This marks an end to
the recession plaguing the region, which had suffered a 0.3% decline even in
the first quarter of 2013.
Positive GDP Data
The resurgence was led by the two largest economies of the continent, Germany
and France. Germany grew by 0.7% in the second quarter, the same as the rate
in the first quarter of 2012. The British economy grew at the same rate,
maintaining the rate achieved in the third quarter of 2012.
France grew by 0.5%, ending the recessionary conditions prevailing in that
country. Recessionary conditions have also eased for the economies of Italy
and Spain, who are third and fourth in terms of size.
According to London-based financial data company Markit, the services index
for the region increased from 49.8 in July to 51 in August. The manufacturing
index increased from 50.3 to 51.3. The monthly composite PMI, which is an
indicator for both services and manufacturing increased from 50.5 to 51.7.
Additionally, consumer confidence has also increased this month, to the
highest level in more than two years. According to the European Commission,
consumer confidence for the Eurozone nations increased from -17.4 to -15.6.
The index has now increased successively over a period of nine months.
The Rise of Emerging Markets
Data released by index provider MSCI shows that indices in Central and Eastern
Europe have risen by 1.2% in the last three months. This is especially
significant, considering that emerging markets as a whole have slumped by
nearly 7.5%. Excluding Russian companies, which have been hit by plummeting
commodity prices, markets in these regions have gained 2.3%.
Macroeconomic indicators support these developments. Hungary's trade surplus
has increased by 6 billion euros from the year-ago period. Poland's retail
sales have grown by 4.3% for July, compared to the same month last year.
Additionally the Czech economy has emerged from a recession, growing by 0.7%
from the earlier quarter.
Mutual Fund Picks
Vanguard European Stock Index (Nasdaq:VEURX-Free Report)
Launched in June 1990, this is the largest of our choices with net assets of
$11.67 billion. It also has a relatively high minimum initial investment
requirement, of $3,000. This is an index fund which tracks the FTSE Developed
Europe Index. The index primarily consists of stocks issued by companies from
the U.K., France, Germany and Switzerland.
The mutual fund holds 508 securities in all. It is widely diversified and its
top 10 holdings make only 19.47% of its assets. The fund returned 27.08% over
the last one year period and has a Zacks Rank #1(Strong Buy).
T. Rowe Price European Stock (Nasdaq:PRESX-Free Report)
With net assets amounting to $885.95 million, the fund was also founded in
1990. This fund focussing on investing in European companies regardless of
their size. It has a higher minimum initial requirement of $2,500.
This fund holds a total of 76 securities. Its top 10 holdings account for
20.41% of its assets. The fund returned 33.56% over the last one year period
and has a Zacks Rank #1 (Strong Buy).
Henderson European Focus A (Nasdaq:HFEAX-Free Report)
The youngest of our picks, launched in August 2001, this is also relatively
smaller in terms of assets. Total assets of the fund amount to $703.25
million. The fund focuses on investing in equity securities of European
companies. It may concentrate it assets in a single or small number of
countries and has a minimum initial requirement of $500.
The fund has a total number of 65 assets. The asset it is most invested in is
European Aeronautic Defence and Space Co NV, which makes up 4.63% of its
assets. The next two, Kinnevik, Investment AB and Accor SA together make up
7.50% of its assets. The fund returned 32.19% over the last one year period
and has a Zacks Rank #1 (Strong Buy).
Europe seems to be on a firmer footing now on the economic front. Moreover,
its emerging economies hold promise. These mutual funds will therefore make
excellent additions to your portfolio.
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