Markets & Finance

S&P Picks and Pans: Intl. Speedway, Anadarko, CBL, Wet Seal


Analyst opinions on stocks making headlines Thursday

S&P MAINTAINS HOLD OPINION ON SHARES OF INTERNATIONAL SPEEDWAY

From Standard & Poor's Equity Research

ISCA; $46.32

ISCA reports August-quarter EPS of 53 cents, before one-time charges that include a 24 cents writedown of the Motorsports Authentics inventory, vs. EPS of 64 cents. We are disappointed with the results, as EPS falls short of our 73 cents estimate. We believe higher expenses will likely remain an issue and we are concerned about Motorsports Authentics, given its profitabilty struggles and this write-down. We are lowering our fiscal 2007 (ending November) and fiscal 2008 EPS estimates to $2.72 and $3.20, respectively, from $2.85 and $3.36. We are also cutting our 12-month target price to $51 from $53 on updated historical and discounted cash-flow valuations. /E. Kolb

S&P MAINTAINS HOLD RECOMMENDATION ON SHARES OF ANADARKO PETROLEUM

APC; $53.66

Based on data from analytical firm Global Insight, and higher price estimates for crude oil, now $68.68 per barrel in 2007 and $74.25 in 2008, and lower natural gas, now $7/Mcf and $8.11, we are cutting our 2007 EPS estimate by 31 cents to $3.65 and 08's by 62 cents to $4.86. Anadarko's production is 52% natural gas, 48% liquids. We see production rising 16% in 2007 and 10% in 2008, driven by acquired assets from Kerr-McGee and Western Gas Resources, which have also raised Anadarko's cost structure. With a rise in industry valuations, we keep our 12-month target price of $58. /T. Vital, M. Kay

S&P REITERATES BUY OPINION ON SHARES OF CBL & ASSOCIATES

CBL; $35.86

Ahead of CBL's third quarter earnings report, which we expect in early November, we are projecting per-share funds from operations of 82 cents vs. year-ago's 78 cents. We expect revenues of about $266 million, an increase of about 7.7% from a year ago, driven by gains in both occupancy and rental income as well as contributions from acquisitions. We see occupancy levels rising, but remaining in the low 90's. We are maintaining our 2007 and 2008 FFO per share estimates at $3.40 and $3.60, but we are raising our target price to $40 from $35, based on our revised price-to-FFO and peer analyses. /R. McMillan

S&P MAINTAINS BUY RECOMMENDATION ON SHARES OF WET SEAL

WTSLA; $3.99

Based on reported weaknesses in store transaction counts and full-price selling this month, and a likely increase in markdowns to keep inventories clean, we are reducing our fiscal 2008 (ending January) EPS estimate to 22 cents from 41 cents. We attribute soft sales to Wet Seal's lower promotional cadence relative to competitors rather than merchandising mistakes at its Wet Seal and Arden B brands. We think this growth company still offers a strong value proposition for fashion seekers. We are cutting our 12-month target price on the highly volatile shares to $5 from $7, on revised peer-P/E valuations. /J. Asaeda


Hollywood Goes YouTube
LIMITED-TIME OFFER SUBSCRIBE NOW

(enter your email)
(enter up to 5 email addresses, separated by commas)

Max 250 characters

Sponsored Financial Commentaries

Sponsored Links

Buy a link now!

 
blog comments powered by Disqus