Zacks Analyst Blog Highlights: Moody's Corp., Thornburg Mortgage, Inc., Nissan Motor Co., Net Servicos de Comunicacao S.A. and TRW Automotive Holdings Corp

Business Wire, Oct 17, 2008

CHICAGO -- 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: Moody's Corp. (NYSE: MCO), Thornburg Mortgage, Inc. (NYSE: TMA), Nissan Motor Co. (Nasdaq: NSANY), Net Servicos de Comunicacao S.A. (Nasdaq: NETC) and TRW Automotive Holdings Corp. (NYSE: TRW).

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Here are highlights from Thursday's Analyst Blog:

Moody's Comps Getting Easier

Moody's Corp. (NYSE: MCO) has a solid franchise in the rating of debt instruments and has diversified itself with credit research and international growth. This has helped MCO offset declining ratings revenues, which fell 35% in the first half of 2008.

A major slowdown in residential mortgages and poor credit market conditions are responsible for this decline in Moody's stock price as investors have grown increasingly concerned about its outlook. Although we don't expect a major improvement in the Structured Finance business, we don't believe it will get meaningfully worse.

Thornburg Mortgage Target: $1

Thornburg Mortgage (NYSE: TMA) is a residential mortgage lender that originates, acquires, and makes investments in ARM (adjustable-rate mortgage) assets. TMA was forced to obtain emergency funds in March 2008 to pay off margin calls following deterioration in the value of its asset base. The new funding has come at a high price, and current shareholders will be diluted by up to 95%.

TMA is currently embroiled in a dispute with the counterparties to its Override Agreement. At issue is whether the counterparties can call for additional margin calls due to downgrades of the company's securities. The counterparties have cut off funding to TMA until the dispute is resolved. As a result, TMA cannot pay interest on its Senior Subordinated Notes and has restructured them.

Nissan Upgraded from Sell to Hold

Nissan Motor Co. (Nasdaq: NSANY) manufactures and sells about 3.5 million cars and commercial vehicles annually in more than 190 countries. Some of its key brands include Altima (sedan), Sentra (sedan), Maxima (sedan), Quest (mini-van), Pathfinder (SUV), Xterra (SUV), Frontier (pick-up truck), Titan (pickup truck) and its luxury brand, Infiniti.

On October 12, Nissan and Al Dahana FZCO announced the establishment of a joint venture company Nissan Gulf FZCO (NGF) to enhance Nissan's marketing and sales strategy in key Gulf Cooperation Council (GCC) markets and introduce a full-fledged financial services platform through all Middle East and North African countries.

Net Servicos a Hold on Macros

Net Servicos (Nasdaq: NETC) is the largest pay-television operator in Latin America, based upon the number of subscribers. Net Servicos operates in more than 40 different cities in Brazil. Its cabling network reaches more than 35 thousand kilometers, running through over 9 million homes.

We are reiterating our Hold recommendation on Net Servicos. We are strongly encouraged by the number of product launches by the company, and a still positive economic environment in Brazil. However, the recent depreciation of the Brazilian real against the U.S. dollar is a problem for NETC, even though we believe that the outlook for Brazilian real in the future remains positive.

TRW Automotive Under Scrutiny

TRW Automotive Holdings Corp. (NYSE: TRW) is a leading supplier of advanced technology products and services for the automotive markets. The company operates in 27 countries through its subsidiaries. These operations primarily involve design, manufacture and sale of active and passive safety related products.

TRW Automotive is affected by constant production cuts by original equipment manufacturers (OEM), pricing pressure and lower production volumes in North America. The shift in consumer preferences from pickup trucks and SUVs to smaller and more fuel-efficient cars in North America and from large and mid-sized passenger cars to small cars in Europe is manifesting a greater-than-expected impact. Lower vehicle production levels and increased commodity costs are also likely to negatively impact the company in the second half of 2008.

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