Jefferies Maintains a 'Buy' on Quiksilver (ZQK); Use Recent Dip As Buying Opportunity
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Price: $0.46 --0%
Rating Summary:
1 Buy, 10 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 17 | Down: 14 | New: 17
Rating Summary:
1 Buy, 10 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 17 | Down: 14 | New: 17
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Jefferies maintains a 'Buy' on Quiksilver (NYSE: ZQK) price target of $5.50.
Analyst, Taposh Bari, said, "EPS: Beat Momentum On the Horizon. In our view, the market's frustration with this stock has to do with management's focus on long-term adjusted EBITDA ($400m by 2015) while de-emphasising near-term EPS (and no official guidance). This is currently at play with ZQK missing 1Q12 EPS (vs. consensus) despite making solid progress towards its 5-year plan. Regardless, the EPS volatility is a reality and the likely reason behind a discounted valuation (ZQK trades at 7x EV/EBITDA vs. the peer group at 9x). As it stands, we see 2Q12 as ZQK's last noisy quarter (modeling a 3c loss vs. Street at +2c) before entering an extended period of accelerated sales and earnings (driven by DC distribution / brand growth, emerging markets, lower product costs, SG&A leverage, etc). As such, we see current valuation as an attractive entry point ahead of a fundamental inflection in the story...We would use the recent -13% correction in ZQK as an opportunity to buy and accumulate shares."
For an analyst ratings summary and ratings history on Quiksilver click here. For more ratings news on Quiksilver click here.
Shares of Quiksilver closed at $4.05 yesterday.
Analyst, Taposh Bari, said, "EPS: Beat Momentum On the Horizon. In our view, the market's frustration with this stock has to do with management's focus on long-term adjusted EBITDA ($400m by 2015) while de-emphasising near-term EPS (and no official guidance). This is currently at play with ZQK missing 1Q12 EPS (vs. consensus) despite making solid progress towards its 5-year plan. Regardless, the EPS volatility is a reality and the likely reason behind a discounted valuation (ZQK trades at 7x EV/EBITDA vs. the peer group at 9x). As it stands, we see 2Q12 as ZQK's last noisy quarter (modeling a 3c loss vs. Street at +2c) before entering an extended period of accelerated sales and earnings (driven by DC distribution / brand growth, emerging markets, lower product costs, SG&A leverage, etc). As such, we see current valuation as an attractive entry point ahead of a fundamental inflection in the story...We would use the recent -13% correction in ZQK as an opportunity to buy and accumulate shares."
For an analyst ratings summary and ratings history on Quiksilver click here. For more ratings news on Quiksilver click here.
Shares of Quiksilver closed at $4.05 yesterday.
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