Science & Technology 
Science and Technology
Science and Technology 
Tue, February 3, 2009
Zacks Bull & Bear of the Day Highlights: InterDigital, Overstock.com, Sanofi-Aventis, Bristol-Myers Squibb and Biogen Idec
CHICAGO--([ BUSINESS WIRE ])--Zacks Equity Research picks InterDigital Inc. (Nasdaq: IDCC) as Bull of the Day and Overstock.com (Nasdaq: OSTK) as Bear of the Day. In addition, the analysts at Zacks Equity Research discuss the latest on Sanofi-Aventis (NYSE: [ SNY ]), Bristol-Myers Squibb (NYSE: [ BMY ]) and Biogen Idec (Nasdaq: [ BIIB ]).
Full analysis of all these stocks is available at: [ http://at.zacks.com/?id=2678 ]
Bull of the Day
We upgrade our rating to Buy with a higher valuation target for InterDigital Inc. (Nasdaq: IDCC), a leading wireless technology and licensing company. This follows the settlement of a patent licensing dispute with Samsung Electronics which further strengthens InterDigital's cash position in addition to reducing royalty related litigation expenses in future reporting periods.
Furthermore, management raised its fourth quarter revenue guidance as a result of an increase in non-recurring revenue. InterDigital continues to undertake effective cost control measures.
We believe the company has a sound business model, a firm financial position, and maintains a strong technological base as it contends with challenging economic conditions.
Bear of the Day
Overstock.com (Nasdaq: OSTK) managed to turn a profit for the fourth quarter, but we were less than impressed. The company received a one-time gain of $1.8 million to its gross profit that enabled the company to report a $0.04 per share profit instead of a loss of $0.04 per share.
In addition, the company's sales declined 13% year-over-year. This decline was due in large part to management cutting its marketing spend by 40%. The company plans to keep those marketing costs steady, and that will produce flat to down sales for the company in 2009.
Meanwhile, Overstock.com will be ramping up its technology and general and admin expenses. In our view, this will result in a revenue decline of 2% and a larger of net loss of $0.74 per share. We reiterate our Sell rating and lower our target price from $7 to $5.
Recent Analysis from the Analyst Blog
Sanofi Eyeing Major Acquisition
Unconfirmed rumors have been circulating since last week that Sanofi-Aventis (NYSE: [ SNY ]), the world's 4th largest pharmaceutical company, is considering a major acquisition. In fact, sources at the Financial Times say the French drug maker is speaking with investment banks about raising as much as $25 billion in cash.
The first name that immediately comes to mind as a potential target for Sanofi-Aventis is Bristol-Myers Squibb (NYSE: [ BMY ]). The duo collaborated on blood thinner Plavix and blood pressure drug Avapro through 50/50 joint ventures. Plavix is the world's second largest selling drug behind Pfizer's cholesterol drug Lipitor.
Another name that comes to mind is biotech bellwether, Biogen Idec (Nasdaq: [ BIIB ]). The deal would be significantly less expensive for Sanofi, and offer one-stop broad move squarely into biologics. For Sanofi, with already significant manufacturing capacity and expertise in vaccine development, acquiring Biogen would give it one of the world's largest biologic manufacturing footprints, along with several late-stage biologic candidates for inflammatory disease and cancer.
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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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