CHICAGO, Aug. 11, 2014 /PRNewswire/ -- Zacks Equity Research highlights Expedia, Inc. (Nasdaq:EXPE-Free Report) as the Bull of the Day and Haverty Furniture Companies, Inc. (NYSE:HVT-Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis onBlackstone Group L.P. (NYSE:BX-Free Report), Kohlberg Kravis Roberts & Co. L.P. (NYSE:KKR-Free Report) and Goldman Sachs Group, Inc. (NYSE:GS-Free Report).
Here is a synopsis of all five stocks:
Bull of the Day:
Expedia, Inc. (Nasdaq:EXPE-Free Report) recently crushed the Zacks Consensus Estimate for the second quarter as demand for travel and travel services strengthened. This Zacks Rank #1 (Strong Buy) is expected to see double digit earnings growth both this year and next.
Expedia is one of the most recognizable online travel companies. It now has an extensive list of brands including Expedia.com, Hotels.com, Hotwire, Egencia, Venere.com, trivago, CarRentals.com, Expedia CruiseShipCenters and eLong, the second largest online travel company in China.
On July 31, Expedia reported its second quarter results and easily beat the Zacks Consensus by 26 cents. Earnings were $0.94 compared to the consensus of $0.68.
Revenue jumped 24% to $1.49 billion from $1.21 billion a year ago. The other metrics also showed solid growth with Room Night growth rising 28% versus 19% a year ago and Gross Bookings jumping 29% due to room night and air ticket growth.
The quarter was boosted by the marketing partnership with Travelocity, which it entered into in the fourth quarter of 2013. That deal contributed 400 basis points of the room night growth.
The analysts liked what they heard as 6 estimates were revised higher for 2014 but it wasn't just 2014 they were excited about. Six estimates were also revised higher for 2015.
Expedia isn't cooling off. Earnings are expected to rise 39.6% in 2014 and another 23.6% in 2015.
Bear of the Day:
Haverty Furniture Companies, Inc. (NYSE:HVT-Free Report) recently had a second so-so quarter in a row. Analysts cut estimates again on this Zacks Rank #5 (Strong Sell).
Havertys has seen it all. The company was founded in 1885 in Atlanta and used to make deliveries in horse and buggy. It now has showrooms in 16 Southern and Midwest states. Havertys went public in 1929 during dark economic times, but it has survived each of the big economic shocks.
The impact of the recent housing bust is obvious in Havertys multi-year earnings history. Earnings plunged 88.7% in 2007 to just 8 cents before the rest of the country went into recession and took Havertys even lower.
The company didn't make money in either 2008 or 2009. Even 2010 and 2011 were still a struggle. But in 2012, the turnaround in the housing market, and the consumer, began to take hold. Havertys made 67 cents that year and it had seen rising earnings estimates until this year.
Additional content:
Blackstone, KKR, TPG Capital Settle LBO Collusion Charges
Leading private equity firms - The Blackstone Group L.P. (NYSE:BX-Free Report), Kohlberg Kravis Roberts & Co. L.P. (NYSE:KKR-Free Report) and TPG Capital LP - have agreed to settle a lawsuit that accused them of pulling down the prices of leveraged buyouts (LBOs) through collusion before the financial crisis. The defendants will be paying $325 million in aggregate as the settlement amount.
The settlement, reached on Jul 28, was disclosed in the court filings on Thursday. The lawsuit was filed way back in Dec 2007 by former shareholders of the acquired companies. It accused more than 10 private-equity firms of rigging the bids to lower competition for takeovers between 2003 and 2007, thereby depriving investors of billions of dollars.
Originally 27 buyouts formed part of the litigation. Consequently in 2013, a federal judge dismissed claims of alleged collusion prior to the announcement of buyouts. The remaining buyouts included movie theater chain AMC Entertainment Inc, casino operator Harrah's Entertainment Inc, software maker SunGard Data Systems Inc and pipeline operator Kinder Morgan Inc, among others
Apart from Blackstone, KKR and TPG Capital, other defendants including The Goldman Sachs Group, Inc. (NYSE:GS-Free Report), Bain Capital Partners and Silver Lake Technology Management L.L.C. have already settled the case.
Together with recent settlements, this would take the recovered amount to a total of $475.5 million. However, all the settlements await approval of the U.S. District Judge William Young, and are expected to be considered at Sep 4, 2014 hearing. Notably, all the private equity firms that have resorted to settlements till now, have not accepted any wrongdoing.
We believe the early settlement of lawsuits prevent increased litigation overhangs for involved companies, as well as relieve the aggrieved investors of lengthy trails and raised expenses. Nevertheless, investors and other financial institutions bearing the brunt of such faulty practices should be fairly compensated.
Currently, Blackstone carries a Zacks Rank #2 (Buy), while KKR holds a Zacks Rank #3 (Hold).
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