CHICAGO, Sept. 1, 2011 /PRNewswire/ -- 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: ConocoPhillips (NYSE: COP),
CNOOC Ltd. (NYSE: CEO), Chevron Corporation (NYSE:
CVX), Marathon Oil Corporation (NYSE: MRO) and
Brown-Forman Corp. (NYSE: BF.B).
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Here are highlights from Wednesday's Analyst Blog:
More Spills, More Trouble for Conoco
U.S. oil giant ConocoPhillips (NYSE: COP), already in the
grip of growing public condemnation and law suits for its earlier
oil spills off China's northern
coast near Platform C of the 19-3 Oilfield in the Bohai Bay, has
admitted to about seven new leaks to State Oceanic Administration
(SOA).
The case of enormous oil spill in Penglai 19-3 oilfield is not
yet over. The Chinese unit of ConocoPhillips confessed to the SOA
that it had showed inefficiency by not detecting the possible
leakage points ahead of the spill.
SOA is rigorously collecting facts and examining the field so as
to measure the extent of marine loss and pollution caused due to
contamination of the oceanic environment. Under SOA's supervision,
ConocoPhillips has collected 387 cubic meters of spilled oil
accounting for about 96.87% of the total oil spill from the
platform.
Since the leaks were first reported in June, it is estimated
that a total of 5,500 square kilometers of the bay's surface has
been polluted, with 870 square kilometers adversely infected.
Allegations have been levelled against Conco for losses incurred
in local tourism and aquatic industries; while oil spills have
reached the beaches in Hebei and
Liaoning province.
Situated 375 kilometers from Beijing, Penglai 19-3 is China's largest offshore oilfield.
ConocoPhillips is the operator of the field with a 49% interest
while the state-owned CNOOC Ltd. (NYSE: CEO) owns the
remaining 51% interest.
For the long term, we maintain a Neutral recommendation on
ConocoPhillips and expect it to perform in line with the broader
market indices. The company faces tough competition from Chevron
Corporation (NYSE: CVX) and Marathon Oil Corporation
(NYSE: MRO).
Brown-Forman Misses Estimates
Brown-Forman Corp. (NYSE: BF.B) recorded fiscal 2012
first-quarter earnings of 81 cents a
share compared with 76 cents a share
in the year-ago quarter. However, earnings missed the Zacks
Consensus Estimate of 83 cents a
share. The robust increase in quarterly earnings was primarily
driven by strong top-line growth and strong volume growth.
Quarterly Details
Brown-Forman's net sales recorded a growth of 13.0% to
$840.3 million from $744.9 million in the prior-year quarter. The
growth was primarily attributable to solid performance in
Germany, Turkey, the U.K., Russia, and Brazil more than offset declines in
Poland, Spain, and Australia. Total Revenue beat the Zacks
Consensus Estimate of $769
million.
During the quarter, Brown-Forman's gross profit grew 11.0% from
the prior-year quarter to $378.8
million, while gross margin decreased 90 basis points (bps)
year over year to 50.0%. Advertising expense fell 19.0% year over
year to $76.3 million.
Selling, general and administrative expenses inched up 5.0% year
over year to $139.0 million.
Conversely, Brown-Forman's operating profit surged 8% from the
prior-year quarter to $185.9 million,
while operating margin contracted 100 times to 22.0% from the
prior-year period.
Balance Sheet & Cash Flow
Brown-Forman ended the quarter with cash and cash equivalents of
$552.5 million and long-term debt of
$505.1 million compared with
$567.1 million and $504.5 million in the prior-year quarter,
respectively.
In the quarter, Brown-Forman generated $64 million of cash from operations and deployed
$46.4 million for dividend payout,
and $6.2 million on capital
expenditures. The company repurchased up to $15.0 million of Class A and Class B shares, out
of $250.0 million share repurchase
program which expires on November 30,
2011.
Dividend
During the quarter, Brown-Forman paid a regular quarterly cash
dividend of 32 cents a share on Class
A and Class B common stock.
Guidance and Zacks Consensus
Moving forward, Brown-Forman anticipates moderate improvement in
global economic conditions and customer trends in fiscal 2012.
Accordingly, the company has delivered its earnings guidance in the
range of $3.45 to $3.85 per
share.
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