Here is a synopsis of all four stocks:
Bull of the Day:
Our Bull of the Day recommendation is for National Semiconductor (NYSE:NSM). Revenue in Q1 was $541.4 million, down 5.4% sequentially and below our estimate. Q1 revenue was negatively affected by customer adjustments in the mobile phone market and excess inventory of LCD flat panel displays. Q2 revenue is expected to decline 2% to 5% on account of falling foundry revenue. On the other hand, earnings per share was $0.35, above our estimate of $0.33. Gross margins rose, despite falling revenue and lower fab utilization. We think the current price offers an attractive entry point. We are reiterating our Buy rating and maintain our target price of $30.
Bear of the Day:
Our Bear of the Day recommendation is for Mills Corporation (NYSE:MLS). The company is currently exploring strategic alternatives and has recently received bids from potential buyers and/or investors. The company is dealing with myriad problems including a restatement of its financial results from 2000 through the first three quarters of 2005, failed developments, and executive departures. Additionally, the company is under investigation by the SEC for accounting irregularities. Full year 2005 numbers and 2006 10Qs should be out sometime in September. Operationally, the company continues to struggle and the common dividend has been cut significantly. We expect much lower than anticipated earnings when numbers are finally released.
Analyst Blog:
Ford's (NYSE:F) Way Forward plan undertaken to restore profitability of the North American automotive business, its new products, profitable financial services business, and cost reduction efforts are some of the positive factors affecting the company. The recent appointment of Allan Mulally as the Chief Executive Officer, who is currently helping the company achieve a turnaround, is further raising our outlook on the company. However, an anticipated difficult operating environment is our main concern. Hence, we reiterate our Hold recommendation and set a six-month target price of $9.00.
We are maintaining our Hold recommendation for Talisman (NYSE:TLM) shares ahead of the company's third-quarter 2006 results. We have lowered our 2006 earnings estimate to $1.67 per share from $1.97 to reflect the lower-volume and higher-cost assumptions and the second-quarter miss. Our 2007 estimate remains unchanged. We believe that the company's positive production-growth profile is adequately reflected in current valuation and see limited upside from current levels. The company also does not compare favorably with its large-cap peers in terms of organic reserve adds, costs, and financial returns.
Get the full analysis of all four stocks by going to http://at.zacks.com/?id=2649.
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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