Zacks Analyst Blog Highlights: FedEx Corp., Shire Plc., The St. Joe Co., Aracruz Celulose S.A., Inc. and Joy Global Inc

Business Wire, Oct 9, 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: FedEx Corp. (NYSE: FDX), Shire Plc. (Nasdaq: SHPGY), The St. Joe Co. (NYSE: JOE), Aracruz Celulose S.A. (NYSE: ARA) and Joy Global Inc. (Nasdaq: JOYG).

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Here are highlights from Wednesday's Analyst Blog:

FedEx Target Price Lowered

We are maintaining our Hold on FedEx Corporation (NYSE: FDX), but cutting our target price to $80. FDX will report second quarter results on December 18. We are retaining our fiscal 2009 (May 31) diluted EPS estimate at $5.25, the high end of FDX diluted EPS guidance of $4.75-5.25, as well as our fiscal 2010 estimate at $6.00.

Fuel surcharges will lag high fuel costs, and the weak economy will hurt LTL ["less-than-truckload"] freight, US express, and copy services. Remedial actions include cost-control measures and cuts in capital spending.

Shire Pharma Trading Fairly

Shire Limited (Nasdaq: SHPGY) is a specialty pharmaceutical company focused on three therapeutic areas: Central nervous system (CNS), gastro intestinal (GI), and renal disorders. Based in England, the company has operations in the U.S., Canada, France, Italy, Spain, and Germany. Shire Limited trades in the U.S. as an American Depository Receipt (ADR).

The company's ADHD [attention deficit hyperactivity disorder] franchise continues to perform very well, increasing market share to over 32%. Vyvanse, the company's new flagship ADHD product, continues to perform well and will be the key driver of the top-line.

St. Joe Co. a No-Go

The St. Joe Company (NYSE: JOE), a publicly held, operationally diverse real estate company, is based in Jacksonville, Florida. It is one of Florida's largest real estate developers. JOE is engaged in town, resort, commercial and industrial development in addition to land sales and commercial real estate operations. The company also has significant interests in the timber industry.

JOE continues to reduce headcounts and cap ex spending in response to a rapidly deteriorating residential Florida real estate market. In addition, the company has responded by paying off most of its debt which will allow the company to hold lots instead of selling into a depressed market.

Aracruz Ripped Down to Sell

Brazil-based Aracruz Celulose S.A. (NYSE: ARA) is the world's largest producer of bleached eucalyptus pulp, as well as one of the low-cost producers of this product. The company is responsible for 31% of the global supply of the product, which is used in the production of a wide range of paper products, including premium tissue, printing and writing papers, liquid packaging board, and specialty papers.

We are changing our current recommendation on Aracruz from Hold to Sell. The international pulp and paper markets remain tight, but the short-term outlook for pulp prices is quite uncertain. The recent deal with VCP is a positive sign; however, second quarter results have been disappointing.

Joy Global Leading with Strength

We are maintaining our Buy recommendation on Joy Global (Nasdaq: JOYG). The global coal market appears strong as supply and demand fundamentals should keep prices elevated for the next several years. This will be a benefit to Joy as it is the world's leading manufacturer of mining machinery in the world.

Sales and bookings were impressive in Q3 reflecting producer's positive long-term outlook for coal prices. Joy's industry leading operating margins look to improve on the back of several cost cutting and capacity expansion initiatives that will be felt as early as 2009.

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