Zacks Bull and Bear of the Day Highlights: Mid-America Apartments, TIM Participacoes, Citi Trends, Inc., Oplink Communications and Nippon Telegraph & Telephone

Business Wire, August 22, 2008

CHICAGO -- Zacks Equity Research highlights Mid-America Apartments (NYSE: MAA) as the Bull of the Day and TIM Participa[?][?]es S.A. (NYSE: TSU) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Citi Trends, Inc. (Nasdaq: CTRN), Oplink Communications (Nasdaq: OPLK) and Nippon Telegraph & Telephone (NYSE: NTT).

Full analysis of all these stocks is available at http://at.zacks.com/?id=2676.

Here is a synopsis of all five stocks:

Bull of the Day: Mid-America Apartments (NYSE: MAA)

MAA reported 2Q FFO of $0.95 per share, 13% higher than the year earlier period and $0.02 per share higher than our estimates. Steady operating results and lower interest expense were the main reasons for the increase. The company expects multi-family fundamentals to weaken in the coming quarters due to a stagnant US economy and lack of meaningful job growth. We still rate the company a buy due to valuation and yield.

MAA is trading at a significant discount to sector averages and the company has an above-average dividend that is being coverage at the AFFO level. We still like the multi-family sector, although declining national job growth trends will have a negative effect on rental demand.

Bear of the Day: TIM Participa[?][?]es S.A. (NYSE: TSU)

We are keeping our Sell recommendation on TIM Participa[?][?]es S.A. Second quarter 2008 results were once again weak, with lower EBITDA and a highly disappointing net loss. It also lowered top-line guidance for 2008. The competitive environment for the Brazilian wireless sector remains a problem, and has been the main reason behind the company being unable to translate competitive advantages into profits. Finally, a tighter monetary policy in Brazil and higher worldwide inflation and interest rates, particularly in Brazil, are matters of great concern.

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Citi Trends, Inc. (Nasdaq: CTRN)

As we expected, Citi Trends reported strong results for the second quarter. Sales were up 19.5% and EPS came in $0.03 ahead of the consensus. The company's results were driven by the government's stimulus package. Despite the big upside in the second quarter, the management maintained its full-year EPS guidance of $1.10-$1.15. Prior to the report, the market expected CTRN to earn $1.25 in 2008.

By maintaining its guidance, the management implied that it expects to earn $0.57-$0.62 per share in the second half of the year versus the consensus estimate of $0.72. That means either management is too conservative with its outlook or the market is too optimistic with its estimates.

Oplink Communications (Nasdaq: OPLK)

Oplink Communications recently reported its Q4:FY08 revenue and EPS above our and consensus estimates, and with margins above our projected levels. The company reported solid growth in its passive components and OMS business, as well as better than expected revenue in ROADMs which more than offset bottoming OCP product sales that were adversely affected by manufacturing transition related capacity constraints.

OPLK guided Q1:FY09 sales above consensus estimates and Q1 pro forma EPS with the guidance range midpoint below consensus estimates. While we are encouraged by the results delivered and the guidance provided in the quarter we are taking a slightly more conservative stance on the ramp of the acquired OCP business and are modestly reducing our FY09 revenue and pro forma EPS estimates. With the company's cash balance accounting for 53% of its market cap, we view the company's announced repurchase plan as an incremental positive.

Nippon Telegraph & Telephone (NYSE: NTT)

NTT, the largest telecom service provider in Japan, announced respectable first quarter fiscal 2009 financial results (ended June 30), well above our estimates. Net earnings improved significantly as a result of reduction of handset subsidies along with an embellished customer pricing strategy at NTT DoCoMo.

Other subsidiaries also generated increasing revenue from IP/Packet communications services. NTT, however, continues to face intense pricing pressure as smaller service providers offer attractive voice, broadband data and mobile services. This, together with ongoing economic weakness in the Japanese market, may limit improved valuation levels over the near-term. We maintain our Hold recommendation on the shares.

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