Zacks Bull and Bear of the Day Highlights: GlaxoSmithKline, Enersis, S.A., R&G Financial and Palm

Business Wire, June 19, 2006

CHICAGO -- Zacks Equity Research highlights GlaxoSmithKline, Plc (NYSE: GSK) as the Bull of the Day and Enersis, S.A. (NYSE: ENI) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on R&G Financial (NYSE: RGF) and Palm (Nasdaq: PALM). Full analysis of all four stocks is available at http://at.zacks.com/?id=2676.

Here is a synopsis of all four stocks:

Bull of the Day:

Our Bull of the Day recommendation is for GlaxoSmithKline, Plc (NYSE: GSK). The company was formed in 2000 as a result of the merger between Glaxo Wellcome, Plc and SmithKline Beecham, Plc. GlaxoSmithKline is the world's second largest pharmaceutical company, with global operations based in the U.K. and the U.S. We are maintaining our Buy rating based on the very strong late-stage pipeline. We also believe that the company still has abundant cost-cutting opportunities in 2006. Our price target is $64 per U.S. ADR based on 18.5x our Fx adjusted $3.48 estimate. We are more positive on large-cap EU pharma then large-cap U.S. pharma, and Glaxo is among our top-picks.

Bear of the Day:

Our Bear of the Day recommendation is for Enersis, S.A. (NYSE: ENI). We remain concerned about the company's weak results in Argentina, leveraged balance sheet, restricted gas supplies from Argentina, and continued high oil prices, which makes the company more exposed to hydrology risk. Moreover, we believe the stock's valuation is exaggerated considering that investors have become more risk averse over the last several weeks.

Analyst Blog:

We reiterate our Hold rating on Class-B shares of R&G Financial (NYSE: RGF), while decreasing our price target once again. The restatement is still in process, with management targeting "the summer of 2006" to file its 10-K for 2005. The common dividend has now been suspended. The preferred offering in late March looked onerous (a 9.5% dividend, 7-year non-call, plus warrants for 8-10 Mn shares and purchase rights tied to the value of R-G Crown), with the lead manager granted a seat on the RGF board. RGF still has not reported any financial results for 2005, but FRB filings seem to indicate deterioration in key metrics (NIM, net income, ROA & ROE, et al). Loan growth appears solid, while the margin suffers as debt costs rise much faster than asset yields.

Palm (Nasdaq: PALM) remains well positioned to benefit from growth in the smartphone market with its Treo product line. With the increasing popularity of the Treo line as it continues to launch new products, including the 700p & 700w with broadband data speeds, the company is poised to benefit from growth in the smartphone market. Moreover, we expect Palm to continue gaining traction in the enterprise market. We therefore maintain our Buy rating on Palm with a six-month price target of $25.00.

Get the full analysis of all four stocks by going to http://at.zacks.com/?id=2649.

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.

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