CHICAGO–(BUSINESS WIRE)–Sept. 12, 2003–Zacks.com releases another list of stocks that are currently members of the coveted Zacks #1 Ranked list which has produced an average annual return of+33.6% since 1988 and has gained +13.3% annually since 2000 as the markets have been tumbling down. Among the #1 ranked stocks today we highlight the following companies: Guitar Center, Inc.(NASDAQ:GTRC) and Janus Capital Group (NYSE:JNS). Further they announced #2 Rankings (Buy) on two other widely held stocks: Maxtor Corporation (NYSE:MXO) and The Ryland Group, Inc. (NYSE:RYL). To seethe full Zacks #1 Ranked list or the rank for any other stock then visit: http://www.zacksrank1bw.zacks.com
Here is a synopsis of why these stocks have a Zacks Rank of 1 (Strong Buy). Note that a #1 Strong Buy rating is applied to 5% of all the stocks we rank:
Guitar Center, Inc. (NASDAQ:GTRC) is the nation’s leading retailer of guitars, amplifiers, percussion instruments, keyboards and pro-audio and recording equipment. The company presently operates stores in major markets and secondary markets. Musician’s Friend, Inc., a wholly owned subsidiary of Guitar Center, Inc., is the one of the largest catalog and Internet retailers of musical instruments in the United States through the Musician’s Friend catalog and its website. For its second quarter 2003, Guitar Center reported earnings per diluted share of 25 cents on net sales of $291.6 million. The earnings result was more than +31% atop the consensus expectation of 19 cents, and also well ahead of last year’s 18-cent result. The company has managed an average EPS surprise of +18% over the past 4 quarters. In the company’s retail division, Guitar Center’s same-store sales advanced by +5%. The company’s profitability is playing beautiful music to investors looking for a niche retail pick.
Janus Capital Group (NYSE:JNS) through its subsidiaries, Janus Capital Corporation, Berger LLC, Nelson Money Managers Plc, and an approximately 33% interest in DST Systems, provides investment management services. Janus reported total assets under management of approximately $152.0 billion, which is up +1.6% from the prior month’s assets of $149.6 billion. Firm-wide average assets under management during August were approximately $149.4 billion compared with July’s average assets of $151.3 billion. In July, JNS reported net income of $47.5 million, or 21 cents per diluted share, on revenues of $250.6 million for the quarter ended June 30, 2003. The firm reported net income of $73.7 million, or 33 cents per diluted share, on revenues of $310.4 million in the comparable 2002 quarter. In the first quarter of 2003, net income was $38.6 million, or 17 cents per diluted share, on revenues of $235.5 million. Mutual fund investors have started to return and Janus has begun to capitalize. Other companies in the field that have been performing well include Merrill Lynch (NYSE: MER). Although the company has a pending class action suit filed against it regarding the illegal timing of the Canary hedge fund among others, since March, the stock has been up over +50%. If earnings continue to get better the share price should continue to follow.
Here is a synopsis of why these stocks have a Zacks Rank of 2 (Buy). Note that a #2 Buy rating is applied to 15% of all the stocks we rank:
Maxtor Corporation (NYSE:MXO) is a leading supplier of hard disk drive storage products for desktop computer systems. Recently the company received top marks from VARBusiness readers in the support and partnership categories for its Maxtor(R) Atlas(R) disk drives and tied for winning the overall enterprise disk drive category. In late July, Maxtor reported pro forma net income of 11 cents per share on revenue of $910.9 million. The earnings result reversed a year-ago loss and beat the consensus by three cents, while revenue improved from $885.4 million. The performance was made possible by Maxtor’s continued focus on operating efficiency and cost management, along with a higher percentage of sales of 80 GB areal density desktop drives and SCSI server drives. The quarter’s results were achieved even though it was a seasonally weak period of the year for the industry. At a stronger point in the year, Maxtor should be able to put together even better results and watch its earnings estimates rise further.
The Ryland Group, Inc. (NYSE:RYL) is a leading national homebuilder and mortgage-related financial services firm. Spearheaded by internal growth in existing and new markets, Ryland reported earnings of $2.03 per diluted share in its second quarter, which was about +30% better than last year and approximately +13% ahead of the consensus. Revenues in the quarter improved by more than +24% to $840 million. The company also enjoyed a record in quarterly new orders and in backlog. Ryland has an excellent record of surpassing Wall Street’s earnings expectations and has put together an average surprise of about +18% over the past four quarters, while analysts still expect next year’s results to be about +10% better than this year’s. Another homebuilder that has caught the attention of analysts include KB Home (NYSE: KBH). Ryland will announce third quarter 2003 earnings on Tuesday, Oct. 21, 2003. The company expects earnings for the fiscal year to exceed $8 per share. Ryland appears to be making the most from favorable market conditions, and may help investors build higher profits.
To truly take advantage of the Zacks Rank, you need to first understand how it works. That’s why we created the free special report; “Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions.” Download your free copy now to prosper in the years to come. http://freezrguideprbw1.zacks.com
About the Zacks Rank
For over 15 years the Zacks Rank has proven that “Earnings estimate revisions are the most powerful force impacting stock prices.” Since 1988 the #1 Ranked stocks have generated an average annual return of +33.6% compared to the (a)S&P 500 return of only +11.3%. Plus this exclusive stock list has generated average gains of +13.3% during the last 3 years; a substantial return compared to the large losses suffered by most investors during that time frame. Also note that the Zacks Rank system has just as many Strong Sell recommendations (Rank #5) as Strong Buy recommendations (Rank #1). And since 1988 the S&P 500 has outperformed the Zacks #5 Ranked stocks by 166.7% annually (11.3% vs. 4.2% respectively). Thus, the Zacks Rank system can truly be used to effectively manage the trading in your portfolio.
For continuous coverage of Zacks #1 Ranked stocks, then get your free subscription to “Profit from the Pros” e-mail newsletter where we highlight #1 Ranked stocks poised to outperform the market. http://www.zacksrank2bw.zacks.com/
The Zacks Rank, and all of its recommendations, is created by Zacks & Co., member NASD. Zacks.com displays the Zacks Rank with permission from Zacks & Co. on its web site for individual investors.
About Zacks
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1981 to compile, analyze, and distribute investment research to both institutional and individual investors. The guiding principle behind our work is the belief that investment experts, such as brokerage analysts and investment newsletter writers, have superior knowledge about how to invest successfully. Our goal is to unlock their profitable insights for our customers. And there is no better way to enjoy this investment success, than with a FREE subscription to “Profit from the Pros” weekly e-mail newsletter. For your free newsletter, visit http://www.freeprofit1bw.zacks.com
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
(a) The S&P 500 Index (“S&P 500”) is a well-known, unmanaged index of the prices of 500 large-company common stocks selected by Standard & Poor’s. The S&P 500 includes the reinvestment of all dividends, no transaction costs, and represents the gross returns before management fees.
Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.
