For Immediate Release Chicago, IL – September 14, 2015 – Zacks Equity Research highlights Equinix (EQIX) as the Bull of the Day and Newmont Mining (NEM) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Halcón Resources Corporation (HK), Seadrill Partners LLC (SDLP) and Cobalt International Energy, Inc. (CIE).
Here is a synopsis of all five stocks:
Bull of the Day:
Equinix (EQIX) is a global provider of network-neutral data centers and Internet exchange services for enterprises, content companies, systems integrators and network service providers. The company is headquartered in Redwood City, CA with two more regional headquarters in London and Singapore.
Through its 100+ International Business Exchanges, or IBX, data centers across 33 strategic markets in the US, Europe, Middle East, Africa, and Asia-Pacific regions, customers can directly inter-connect critical traffic exchange requirements.
A Unique Place Amidst Customers and Competitors
There is a reason that Equinix is considered the dominant data-network infrastructure provider globally. It has to do with its unique place in an enterprise and telecom marketplace where data-rich transmission and storage services are still growing rapidly.
Equinix has been achieving continued business momentum with its critical mass of customers and the resultant “network effect” within its IBX centers. Direct interconnection with its networks, connecting the majority of the world’s Internet routes, enables customers to increase the efficiency of their IT infrastructure, remove complexities associated with infrastructure administration and management and reduce costs.
Service offerings, such as Equinix Exchange and Equinix Internet Exchange, significantly reduce the cost of critical transit, peering and traffic exchange operations by eliminating the costs of private peering or local loops. The benefits provided by the Platform Equinix have led to a loyal and blue-chip customer base of over 6,300 firms.
Bear of the Day:
While the price of gold is down just over 10% in the past 12 months, Newmont Mining (NEM) shares are off nearly 40%. A metals investor might take solace in the fact that the entire basket of miners, as represented by the MarketVectors Gold Miners ETF, is off over 45% in that time.
But the fact remains that the miners appear to be running ahead of the continued bear market in the metal. And you need only look at the downward Earnings Estimate Revisions (EER) in a name like Newmont to see the impact that analysts are projecting for these falling knives.
In just the last 90 days, full-year 2015 EPS estimates for NEM have dropped from $1.25 to $1.07, representing earnings "growth" of -2%. But it gets worse looking into next year.
Full-year 2016 earnings projections have been slashed from $1.34 to $0.81, representing -24% on the bottom line.
Additional content:
Capitol Hill to Lift Oil Export Ban? 3 Smart Picks
Oil prices rallied on Thursday after the Energy Information Administration’s (EIA) latest data revealed higher demand for gasoline, owing to late-summer travels by automobile. But Goldman Sachs dampened the mood with a warning that failure to reduce crude production may drag the commodity prices to as low as $20 a barrel.
Quickly, developments on Capitol Hill drew a silver lining for the commodity. On Thursday, a House Energy and Commerce Committee subcommittee approved a bill to lift the ban and sent the legislation to the full Energy and Commerce committee to vote on it next week.
Rising Inventories
In recent times, U.S. oil production has grown without any restriction. Per EIA, the combined U.S. production of crude oil and lease condensate increased from 5.6 million barrels per day (bbl/d) in 2011 to 8.7 million bbl/d in 2014. Subsequent to that, the agency in its August Short-Term Energy Outlook forecast U.S. crude oil production of 9.4 million bbl/d for 2015.
The most recent EIA report revealed that crude inventories increased by 2.6 million barrels in the week ending Sep 4, 2015. At 458.0 million barrels, U.S. crude oil inventories remain near levels not seen at this time of year in at least the last 80 years.
Concurrently, the latest monthly oil rig count from Baker Hughes rose by 19 from the previous month to 1,137 in Aug. The rise in rig count also points to more crude production going into the future.
Lifting Export Ban Now Only a Matter of Time
Given the relentless rise in production, lifting the four-decade old ban on U.S. oil exports makes more sense. This mood is now echoing from divergent corners of Capitol Hill. Recently, Republican presidential candidate Marco Rubio made a salient point to lift the ban in his energy policy.
Initiation of exports would greatly help the beleaguered books of independent exploration and production companies. Capitol Hill has lately seen intense lobbying by the industry bigwigs for the lifting of the ban.
If the present trend of patronage continues, the House will likely vote in favor of lifting the ban this month. This would certainly bring a fresh lease on life to the energy space, so long embroiled in apprehensions pertaining to the Chinese economy, a volatile economy in Greece and the Eurozone and near-record production from OPEC (mainly in Saudi Arabia and Iraq).
Oil Investors to Profit
A prolonged period of low oil prices has eventually lent quality upstream assets cheap valuations. Therefore, we would like to draw investors’ attention to the neglected upstream space, where most players are trading below par. Smart investors might see this as a window of opportunity.
As such, with oil hovering around the $45-a-barrel level, investors with an appetite for gains should pick the upstream gems out of the rubble with the help of the time-tested Zacks Rank Methodology which arranges stocks from #1 (Strong Buy) to #5 (Strong Sell).
Smart Picks
If the export bill is passed, the biggest gainers would be the West Texas Intermediate (WTI) exposed upstream players. Investors can start accumulating some well-ranked players in the upstream space like Halcón Resources Corporation (HK), Seadrill Partners LLC (SDLP) and Cobalt International Energy, Inc. (CIE). Of these, Halcón Resources and Seadrill Partners sport a Zacks Rank #1 (Strong Buy) and Cobalt International holds a Zacks Rank #2 (Buy).
Get today’s Zacks #1 Stock of the Day with your free subscription to Profit from the Pros newsletter:
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.
About the Analyst Blog
Updated throughout every trading day, the Analyst Blog provides analysis from Zacks Equity Research about the latest news and events impacting stocks and the financial markets.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous analyst coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today. Find out What is happening in the stock market today on zacks.com. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report EQUINIX INC (EQIX): Free Stock Analysis Report NEWMONT MINING (NEM): Free Stock Analysis Report HALCON RESOURCS (HK): Free Stock Analysis Report SEADRILL PTNRS (SDLP): Free Stock Analysis Report COBALT INTL EGY (CIE): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research
|