Zacks Analyst Blog Highlights: JA Solar Holdings Co. Ltd., CSX Corp., W.W. Grainger, Inc., BB&T Corp. and Select Comfort Corp

Business Wire, Oct 21, 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: JA Solar Holdings Co. Ltd. (Nasdaq: JASO), CSX Corp. (NYSE: CSX), W.W. Grainger, Inc. (NYSE: GWW), BB&T Corp. (NYSE: BBT) and Select Comfort Corp. (Nasdaq: SCSS).

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Here are highlights from Monday's Analyst Blog:

JA Solar Still Shines Brightly

JA Solar Holdings Co. Ltd. (Nasdaq: JASO) based in Ningjin of the Hebei province in the People's Republic of China, manufactures high-performance, monocrystalline solar cells using processing technologies.

JASO registered a three-fold rise in revenues while its earnings jumped four-fold in the second quarter of 2008. Bullishness stems from strong global demand for its photovoltaic cells. Going forward, increasing demand for solar energy, improving production costs, coupled with ongoing capacity expansions and burgeoning committed supply of key raw materials, will continue to boost the cash-rich JASO's growth story.

CSX Target Cut, Stays a Buy

Based in Jacksonville, Florida, CSX Corp. (NYSE: CSX) provides rail freight and intermodal transportation through its subsidiaries. Improved pricing due to strong customer demand and tight transportation supply and fuel surcharges combined with cost escalation clauses in multi-year customer contracts are driving revenue gains across the board. Increasing freight rates are expected to sustain top-line growth of at least 5-6% over the next few years.

CSX Corp. posted third quarter EPS of $0.94, above the $0.93 consensus, but below our $0.97 estimate, due to storm-related losses in the Gulf Coast and the Midwest. We are cutting our EPS estimates to $3.66 from $3.70 for 2008, as CSX Corp. is now targeting the low end of EPS guidance of $3.65-3.75, and to $4.25 from $4.40 for 2009.

Grainger a Hold Despite Growth

W.W. Grainger, Inc. (NYSE: GWW) is a leading North American distributor of products used by businesses and institutions to keep their facilities and equipment running. The company reported third quarter EPS of $1.79, up 38.8% from the year-ago level of $1.29 amid sales growth, profitability from market expansion initiative, product line expansion and share buybacks.

Despite a slowing economy, new product offerings and market expansion initiatives are expected to boost profitability over the next few quarters. However, organic growth in the Lab Safety Supply segment remains weak.

BB&T Ests Reduced Post-Earnings

On October 16, BB&T Corp. (NYSE: BBT) reported its 3Q08 financial results. Net income for the quarter came in at $358 million, or $.65 per diluted share. Operating earnings, excluding $35 million in net after-tax securities gains, $26 million in after-tax charges for other-than-temporary impairment and $6 million in after-tax charges for nonrecurring professional fees and merger-related and restructuring charges, for 3Q08 totaled $355 million, or $0.64 per diluted share.

However, credit metrics deteriorated further with the non-performing assets rising by 25 bps sequentially to 1.20% of total assets, due to challenging conditions in the residential real estate markets. As we suspect that the continued deterioration in the housing markets will keep the credit losses at an elevated level in the coming quarters, we are reducing our FY08 and FY09 estimates, while maintaining our Hold recommendation on the shares.

Select Comfort Out of Its Zone

Select Comfort (Nasdaq: SCSS) is in a difficult position, as sales trends in the mattress industry are awful. Due to a difficult macro environment, consumers are cutting back on spending. As a result, there is very little demand for the company's high-quality but high price-point bedding. We are reducing our estimates ahead of third quarter earnings release, which is scheduled for October 22.

While the company no longer provides specific sales and earnings guidance, management previously indicated that it expects to return to profitability in the second half of the year due to its cost-cutting efforts. We maintain our Hold rating, as its shares reflect an extended period of weak results.

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