For Immediate Release Chicago, IL – September 10, 2015 – Zacks Equity Research highlights SolarEdge Technologies (SEDG) as the Bull of the Day and Compania de Minas Buenaventura (BVN) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Crescent Point Energy Corp. (CPG), Penn West Petroleum Ltd. (PWE) and Baytex Energy Corp. (BTE).
Here is a synopsis of all five stocks:
Bull of the Day:
Many companies say they are cutting costs, and streamlining production to be more efficient, but few actually accomplish their goals in such a short period of time. SolarEdge Technologies (SEDG) has been able to cut costs, produce more efficient products, and post record revenues over the last year. More importantly, they are projecting to experience an annual +10% cost reduction in their DC optimizer product via improvements in scale, and supply chain management. And, their Gen3 inverter is expected to be half the size, and half the weight which will directly translate into a lower cost structure. Due to these reasons, SolarEdge Technologies is the Zacks Bull of the Day.
This Zacks Rank #1 (Strong Buy) company provides inverter solutions. The company's SolarEdge system offers power optimizers, inverters and a cloud-based monitoring platform. It serves residential solar installations to commercial and small utility-scale solar installations. Specifically, “SolarEdge invented an intelligent inverter solution that revolutionized the way power is harvested and managed in a solar photovoltaic (PV) system. The SolarEdge direct current (‘‘DC’’) optimized inverter system maximizes power generation at the individual PV module level while lowering the cost of energy produced by the solar PV system” according to management.
In their most recent quarter, the company posted record fiscal Q4 15, and record fiscal year 15 revenues; +13.9% q/q, and +120.8% y/y. Further, management was able to improve gross margins to 28.7% in Q4 15, and 25.2% for FY 15. During this time, the company had 284 Megawatts (AC) of inverters shipped for Q4 15, and had a total of 920 Megawatts (AC) for FY 15. According to Founder and CEO Guy Sella, “We successfully grew our business with our existing and new customers and generated record revenue for the fourth fiscal quarter and the entire fiscal year. Our increased manufacturing capacity coupled with continued cost reduction, brought gross margins to a quarterly and annual record. These revenue and cost reduction initiatives generated strong bottom line results; consecutive profits in each quarter of fiscal 2015 and strong cash flow from operations.”
Bear of the Day:
Over the next year many precious metals are expected to fetch a lower price level. This is due to a few factors; uncertainty about demand coming from China due to lower than expected growth, lower than expected oil prices which has lowered the expected trading range for gold in 2016, and falling inflation. Just over a week ago, Standard & Poor’s cut their price forecasts for aluminum, copper, zinc, nickel, and gold. This is not good news for Compania de Minas Buenaventura (BVN), who is Peru’s largest publicly traded precious metals mining company, and the Zacks Bear of the Day.
This Zacks Rank #5 (Strong Sell) company is a leading mining company producing precious metals and holding mining rights in Peru. Since its inception in 1953, Buenaventura has focused on exploration and exploitation activities both by its own and through joint ventures. Buenaventura also is an important shareholder of Minera Yanacocha S.R.L., one of the leading gold producers in Latin America.
Further, it is not just the recent precious metal forecasts that have negatively impacted both the top and bottom lines for Buenaventura, this problem has been going on for a bit now. In their most recent earnings report Buenaventura saw total revenues decline -15% y/y, and Net sales decline -16% y/y. To make matters worse, the company saw declining average realized prices in every metal besides zinc; Gold down -7%, Silver down -18%, and Copper fell -22% year over year. To further complicate matters, volumes for these three metals are down year over year as well; Gold -16%, Silver -3%, and Copper -13%.
Decreasing Estimates
It was not just S&P who cut their precious metal price forecasts, most major agencies are following suit as well. This has caused significant downgrades for EPS and Revenue expectations for the company.
Additional content:
Oil’s Steep Fall Causes Canadian Suppliers to Cut Dividends
As oil prices look set to expand their year-long rout, major Canadian energy producers are accelerating their dividend cuts and further chopping costs in an effort to shore up dwindling cash flows.
Cheap Oil Forces Canadian Economy into Recession
Canada’s economy has been a victim of the oil price plunge, technically falling into a recession in the first half of the year. As per Statistics Canada, the world's fifth-largest oil producer’s GDP shrank 0.5% during the second quarter following a 0.8% retreat in the previous three months. The troubled numbers were blamed, in large part, on the continuing slump in the energy sector that called for massive layoffs and declining investment.
Negative Announcements Galore
Oil sector’s fast deterioration has forced producers to make deep cost cuts by reducing/suspending their payouts.
Let’s look at four Canadian energy companies that slashed their dividends in 2015:
1. Crescent Point Energy Corp. (CPG): On Aug 12, the largest oil producer in Saskatchewan slashed its dividend by 57% to 10 Canadian cents per share. The payout cut – first time in the Zacks Rank #3 (Hold) company’s 14-year history – was accompanied by a suspension in its dividend reinvestment plan and a cut in its capital spending budget by C$100 million.
2. Penn West Petroleum Ltd. (PWE): Lower oil prices also forced Penn West Petroleum to suspend its dividend indefinitely after its next payday in Oct. The mid-sized energy explorer, sporting a Zacks Rank #3, also plans to lay off more than 400 employees (or 35% of its workforce), apart from reducing board compensation by 40% and further scaling back 2015 capital spending by C$75 million to C$500 million.
3. Baytex Energy Corp. (BTE): Another Canadian producer eliminating cash dividend n the wake of collapsing energy prices is Calgary-based Baytex Energy. The Zacks Rank #3 company said that it will suspend its monthly dividend of 10 Canadian cents, effective after the Sep. 15 payout. Additionally, Baytex Energy scaled back this year’s capital spending to C$500 million, while expecting 2016 budget to be around 25% less.
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SOLAREDGE TECH (SEDG): Free Stock Analysis Report
BUENAVENTUR-ADR (BVN): Free Stock Analysis Report
CRESCENT PT EGY (CPG): Free Stock Analysis Report
PENN WEST EGY (PWE): Free Stock Analysis Report
BAYTEX ENERGY (BTE): Free Stock Analysis Report
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