Zacks Analyst Blog Highlights: Warren Resources Inc, ABB Ltd, Alliance Healthcare Services Inc, Cougar Biotechnology Inc and Ford Motor Co.

Business Wire, April 08, 2009

http://www.profits.zacks.com/

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: Warren Resources Inc (NASDAQ: WRES), ABB Ltd (NYSE: ABB), Alliance Healthcare Services Inc (NYSE: AIQ), Cougar Biotechnology Inc (NASDAQ: CGRB) and Ford Motor Co (NYSE: F).

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Here are highlights from Tuesday’s Analyst Blog:

Warren Resources Value Attractive

Warren Resources Inc (NASDAQ: WRES) is an independent energy company engaged in two major developments: the Atlantic Rim CBM play in Wyoming's East Washakie Basin, and secondary oil recovery operations in the Wilmington field in the Los Angeles Basin. This oilfield represents the third largest field in the U.S., and around 90% of the company's proved reserves are located in the Wilmington field.

The current commodity-price and credit market downturn has hit Warren hard. Its high-cost oily Wilmington play has become uneconomical, resulting in a more than 60% drop in proved reserves. And its natural gas asset in Wyoming is exposed to depressed Rockies prices. In response, the company has cut its cap-ex budget to the bone, which it should meet through internal cash flows.

ABB Downgraded to Sell

ABB Ltd (NYSE: ABB) is a leader in power and automation technologies that enable utility and industry customers to improve performance while lowering environmental impact.

The global economic growth -- coupled with the attendant demand for power and automation -- that stimulated investment in new and expanded plants over the last 12 to 24 months is expected to decline to some degree during 2009, which is cause of concern for ABB.

Medicare Covering PET Scans

According to a national coverage determination memo issued by the CMS, the use of PET scans to diagnose and determine initial treatment for most solid-tumor cancers will now be automatically covered under Medicare. CMS determined that there is sufficient evidence to support that the results of FDG PET imaging are useful in determining the appropriate initial treatment strategy for beneficiaries with suspected solid tumors and myeloma to improve health outcomes.

The decision removes a previous requirement that patients receiving PET scans for cancer diagnosis be enrolled in the “Coverage with Evidence Development program’s National Oncologic PET Registry observational” study in order for Medicare to cover the procedure. Coverage will also be expanded to include use of PET scans in subsequent treatment-strategy evaluation for 11 cancers, including ovarian, cervical and myeloma cancers, according to CMS officials.

The news is positive for Alliance Healthcare Services Inc (NYSE: AIQ) a leading national provider of outsourced diagnostic imaging, and more recently therapeutic services, to primarily small-to-mid-sized hospitals and other health service providers.

Cougar Biotech Initiated at Hold

Cougar Biotechnology Inc (NASDAQ: CGRB) will generate no revenue in 2009, and operating expenses will significantly increase during the year as the second phase III trial for CB7630 commences. We model operating expenses to increase to $83.0 million in 2009, up from $63.1 million in 2008. We forecast EPS of ($3.94) in 2009.

Cougar had $91 million in cash and securities investments at the end of 2008. Cash used in operations was $44.7 million in 2008 and $15.4 million in the fourth quarter 2008.

Ford, Debt Holders Make a Deal

Ford Motor Co (NYSE: F) recently went to its debt holders to get concessions. They represented $4.3 billion of convertible debt, 3.4 billion of unsecured debt and $2.2 billion of term loans.

In aggregate, these holders (who had almost $10 billion of Ford debt) agreed to the following deal: $2.4 billion of cash and 468 million Ford shares (worth $1.7 billion). So debt holders in aggregate agreed to a 60% haircut rather get pennies on the dollar in a potential bankruptcy situation.

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