2008-10-31 11:05:59 -
- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Shire PLC (Nasdaq: SHPGY), O'Reilly Automotive, Inc. (Nasdaq: ORLY), Burlington Northern Santa Fe Corp. (NYSE: BNI), United Therapeutics Corp. (Nasdaq: UTHR) and
Odyssey HealthCare, Inc. (Nasdaq: ODSY).
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Here are highlights from Thursday's Analyst Blog:
Shire to Sail on New Flagship
Shire PLC (Nasdaq: SHPGY) is a specialty pharmaceutical company focused on three therapeutic areas: Central nervous system (CNS), gastro intestinal (GI), and renal disorders.
The company's ADHD franchise continues to perform very well, increasing market share to 33%. Strong top-line growth should continue in 2008 as a number of new drugs ramp. We expect revenue to fall in 2009 due to the presence of generic Adderall XR. Longer-term sales growth will materialize as Vyvanse and other new drugs fill the hole left by generic Adderall XR.
O'Reilly Auto Driving Through
O'Reilly Auto (Nasdaq: ORLY) has an excellent growth strategy with an exposure to both do-it-yourself (DIY) and do-it-for-me (DIFM) segments of aftermarket industry.
On October 29, 2008, O'Reilly Automotive Inc. reported third quarter results for 2008. Sales for the three months ended September 30, 2008, totaled $1.11 billion, up 68% from $0.66 billion for the same period a year ago.
Burlington Northern Chugs Along
Fort Worth, Texas-based Burlington Northern Santa Fe Corp. (NYSE: BNI) offers rail transportation services to two-thirds of the Western U.S. as well as from the Gulf of Mexico to Canada.
We are continuing our Hold on Burlington Northern Santa Fe Corporation, but decreasing our target price to $87. BNI reported 2008 third quarter diluted EPS before nonrecurring items of $1.91, up 29% year-over-year and well above consensus of $1.69 and our $1.64 estimate, as revenues came in higher than expected.
United Therapeutics a Sell
United Therapeutics Corporation (Nasdaq: UTHR), a biotechnology company, engages in the development and commercialization of therapeutic products for patients with chronic and life-threatening diseases. It offers products primarily in three therapeutic areas, including cardiovascular, cancer and infectious diseases.
Although we believe current business fundamentals are solid, we are seeing several potential hiccups coming in the next year. The stock is currently trading at 37x our 2008 EPS estimate. This is a significant premium to the biotechnology peer group average.
Odyssey HealthCare Fairly Priced
Odyssey HealthCare (Nasdaq: ODSY) is a major provider of hospice services in the U.S., with a presence in 30 states. The company reported better-than-expected 3Q08 net income of $5.9M, or EPS of $0.18 (excluding $0.6M of one-time after-tax costs and a $2.1M pretax benefit from a reduced cap accrual), compared with net income and EPS of $3.1M and $0.09, respectively, in 3Q07.
As in the previous quarter, the result was characterized by a number of expenses related to the integration of the Vistacare acquisition, which we expect to continue into 4Q08. Potential Vistacare synergies aside, we believe Medicare-related reimbursement risk remains high at this time and retain our Hold recommendation on the stock at current levels.
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