Zacks Bull and Bear of the Day Highlights: Qualcomm, H&R Block, Rudolph Tech and Ferrellgas

Business Wire, Dec 13, 2007

CHICAGO -- Zacks Equity Research highlights Qualcomm, Inc. (Nasdaq: QCOM) as the Bull of the Day and H&R Block (NYSE: HRB) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Rudolph Technologies (Nasdaq: RTEC) and Ferrellgas (NYSE: FGP). Full analysis of all these 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 Qualcomm, Inc. (Nasdaq: QCOM). We reiterate our Buy recommendation and the same valuation target for Qualcomm, a leading developer of digital wireless chipsets based on CDMA technology, following its fourth quarter (ended September) of fiscal 2007 financial results, well above our estimates. Qualcomm's fundamentals remain compelling as robust growth in the 3G wireless handset markets throughout the world are driving healthy selling volume. Multiple WCDMA operators adopted Qualcomm's BREW platform and the company maintains favorable average selling prices on most of its business lines, despite increased competition. We believe continued strength in the 3G wireless market, coupled with superior technology and a cash intensive balance sheet, support Qualcomm's long-term growth prospects.

Bear of the Day:

Our Bear of the Day recommendation is for H&R Block (NYSE: HRB). We maintain our Sell rating for HRB following the preliminary release of Q2 results. HRB was unable to file its 10-Q with the SEC within the required time period, and the company postponed its conference call with analysts. Despite recent changes in the company's senior management team, significant uncertainties remain with respect to the impact of the company's decision to shut down its Option One mortgage business. Until the picture regarding this sale becomes clearer, we would not recommend that investors initiate new positions in HRB with the share price near current levels. We will further update our model, outlook, estimates and valuation following the filing of the company's 10-Q and its conference call with analysts.

Analyst Blog:

Rudolph Technologies (Nasdaq: RTEC) is an original equipment manufacturer (OEM) of process diagnostics and control (PDC) equipment used within the semiconductor manufacturing industry. September quarter top- and bottom-line results outperformed consensus estimates. The company recently closed the acquisition of August Technology, nearly doubling the size of the firm. Rudolph is currently trading at a 30.2x multiple of price to fiscal 2008 earnings (P/E). Historically, the metrology tools segment demand tends not to be as volatile as the rest of the equipment sector, since the equipment helps to improve the efficiency of the manufacturing process. Rudolph's product portfolio is highly leveraged to the leading-edge 300mm and copper metallization areas. As semiconductor factory utilization creeps up, the demand for new 300mm fab lines will increase. In fact, sales of the 300mm advanced technology tools now account for 67% of tool revenue.

We are maintaining our Hold recommendation on Ferrellgas (NYSE: FGP) units following the partnership's fiscal first-quarter 2008 results, as we continue to believe that current valuation adequately reflects the partnership's lack of distribution-growth prospects, margin pressures, and a relatively weak balance-sheet. We continue to believe that the partnership's cost reduction efforts through its Renaissance rollout are already priced in current valuation. We also expect the ongoing weakness in the credit markets to continue weighing on master limited partnership (MLP) valuations in the near to medium term.

Get the full analysis of all these 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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