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Brighter Construction Outlook but Continued Macro Concerns for Commercial Metals

April 5, 2013 – 1:59 pm |

We are maintaining our fair value estimate following Commercial Metal’s CMC second-quarter earnings results, continuing to forecast a 2013 that will look much like 2012. The company’s second fiscal quarter typically fares the worst seasonally owing to weather- and holiday-related lulls in construction activity. This year proved no different, dragging the construction-heavy fabrication business back Read more […]

NV Energy Asks State Lawmakers to Allow it to Shutter All Coal-Fired Plants

April 4, 2013 – 3:06 pm |

On April 3, NV Energy asked Nevada lawmakers to allow the company to shutter all 1,073 megawatts of coalplant generating capacity starting in late 2014. With those closures, the company proposed a generation portfolio that eventually would be 60% natural gas and 40% renewable wind and solar. The company wants legislation requiring the Nevada Public Utilities Commission to review the plan in April 2014 Read more […]

LabCorp Meets Fourth-Quarter Expectations and Ramps Up Investment for 2013

April 4, 2013 – 8:42 am |

Morningstar’s issuer credit rating for LabCorp remains at BBB+, reflecting their positive view of the diagnostics industry and LabCorp’s manageable financial position. Generally, we admire the diagnostics business, and we also rate close competitor Quest Diagnostics BBB+. Like most health-care firms, diagnostic operators are somewhat resistant to economic pressures, and while this most recent recession Read more […]

Pepsi to Return to Growth in 2013

April 3, 2013 – 8:35 am |

Pepsi’s wide economic moat is derived from its direct store delivery system which sells a vast portfolio of snacks and beverages, global scale, and strong brands which dominate the snack business. Pepsi has a lower Cash Flow Cushion than our typical AA- issuer as the firm has significant debt repayments over the next few years.

However, given Pepsi’s relatively low free cash flow variability, this Read more […]

GameStop Reports Soft 4Q Results

March 30, 2013 – 7:53 pm |

GameStop reported fourth-quarter results that exceeded the Street’s expectations, but also issued a disappointing fiscal 2013 outlook. With the help of the 53rd week, fourth-quarter sales declined only 0.5% over the prior year period (to $3.56 billion) despite a 4.6% comp decline, and adjusted net earnings increased 9.5% to $262 million. Traditional video game categories remain weak due to the old Read more […]

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