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Zacks Bull and Bear of the Day Highlights: Garmin Ltd., General Motors, Regency Centers, Amgen and Rio Tinto

^{Published on 2008-12-18 03:32:35 - Market Wire}
 

CHICAGO--([ BUSINESS WIRE ])--Zacks Equity Research highlights Garmin Ltd. (Nasdaq: GRMN) as the Bull of the Day and General Motors (NYSE: GM) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Regency Centers Corp. (NYSE: REG), Amgen, Inc. (Nasdaq: AMGN) and Rio Tinto, Plc (NYSE: RTP).

Full analysis of all these stocks is available at [ http://at.zacks.com/?id=2676 ].

Here is a synopsis of all five stocks:

Bull of the Day: Garmin Ltd. (Nasdaq: GRMN)

Garminis an OEM [original equipment manufacturer] of GPS-based equipment. September quarter results were in-line with the consensus on both the top and bottom lines. All segments were up double-digits in 2007, and are expected to be up again in 2008.

We note that pricing pressures continue to intensify, negating some of the growth in units. Management is optimistic about material prices offsetting ASP pressures in 2008. We see declining profitability for the company.

However, the shares appear cheap, given the current valuation. Consequently, we are reiterating our Buy rating on GRMN shares.

Bear of the Day: General Motors Corp. (NYSE: GM)

The company has failed to secure any loan from the government until now. The U.S. government was supposed to provide $25-50B in aid as DIP [debtor-in-possession] financing. The government also rejected the immediate $12 billion short term loan as the UAW [United Auto Workers] refused to accept any wage cut until 2011.

General Motors is looking at money under the Troubled Asset Relief Program (TARP). However, this is still under review. Any aid should force the company to only make 35MPG+ vehicles. Management should be purged and outsiders brought in. Tariffs and quotas should be implemented for imported vehicles from overseas. Consumers should be allowed to deduct their automotive interest.

Lastly, global alliances should be forged among producers in North America, Europe and Asia. From an equity holder perspective, we rate the shares a Sell with a six-month target price of $0.00.

Latest Posts on the Zacks Analyst Blog:

Regency Centers Corp. (NYSE: REG)

Jacksonville, Florida-based Regency Centers,a self-administered and self-managed real estate investment trust (REIT), is one of the leading owners, operators, and developers of grocery-anchored retail shopping centers in the US. Currently, the company owns or has interests in 443 retail properties, including properties held in joint venture, spanning approximately 59 million square feet.

Retail-focused REITs will face a much more difficult operating environment in the coming quarters. Consumer spending patterns are weakening across the country and large chains are curtailing expansion plans.

Amgen, Inc. (Nasdaq: AMGN)

Amgen, a global biotechnology company, is focused on the development and commercialization of human therapeutics. The company's key products are Epogen/Aranesp (anemia), Neupogen/Neulasta (neutropenia), and Enbrel (inflammatory disease).

Results over the past few quarters demonstrate the challenging, but stabilizing ESA [erythropoiesis stimulating agents] market. Nevertheless, we still feel as though the pipeline is significantly undervalued, and we continue to recommend the name as a long-term hold within the biotechnology sector.

Rio Tinto, Plc (NYSE: RTP)

Rio Tinto announced a series of initiatives aimed at reducing debt and strengthening the balance sheet.

The company announced a headcount reduction totaling over 14,000, a commitment to cut FY09 CAPEX by over $5 billion, a plan to reduce $2.5 billion in annual operating costs by FY10, and a goal to divest of certain, significant assets. Rio Tinto set a $10 billion target for net debt reduction in FY09, which is integral to addressing the $8.9 billion credit facility maturing in late FY09 and to lowering the net debt (as of October 31) of $38.9 billion.

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About the Bull and Bear of the Day

Every day, the analysts at Zacks Equity Research select two stocks that are likely to outperform (Bull) or underperform (Bear) the markets over the next 3-6 months.

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