Barclays on U.S. Life Science Tools: Q3 Preview: Is Sentiment Near a Bottom?
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16 Buy, 8 Hold, 2 Sell
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Today's Overall Ratings:
Up: 11 | Down: 13 | New: 17
Rating Summary:
16 Buy, 8 Hold, 2 Sell
Rating Trend: Up
Today's Overall Ratings:
Up: 11 | Down: 13 | New: 17
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Barclays on U.S. Life Science Tools: Q3 Preview: Is Sentiment Near a Bottom?
Barclays analyst, Nandita Koshal, said, "We present a preview of the upcoming earnings season. Focus names are Agilent (NYSE: A), Illumina Inc (Nasdaq: ILMN), Waters (NYSE: WAT). This quarter has been a moving target, with the macro outlook impacted by policy uncertainty. More recently though, stabilization of the U.S. growth outlook, Chinese monetary policy steps to improve liquidity in the SME sector, and EU policymakers' apparent willingness to facilitate an orderly deleveraging process, has led our Portfolio Strategy team to expect a decline in the extreme levels of equity market correlation, which may be the catalyst for a continued equities advance through 4Q11."
"With risks still skewed to the downside for 2012, we prefer names with one or more of these traits - internal levers to drive earnings, relatively robust
end-markets/product cycles, and strong balance sheets. WAT and Thermo Fisher Scientific (NYSE: TMO) stand out as more resilient names, in our view. Agilent and ILMN are stocks with strong negative sentiment overhangs, but upcoming potentially positive catalysts."
WAT is a high-quality cyclical play; Top-pick. Contrary to market concerns around a Q3 miss, we believe WAT saw robust demand for key products like the H-class and Xevo TQ-S through Q3, and solid backlog build for recently launched products (I-class and Synapt G2-S)...ILMN: the pendulum has swung. Sentiment on this high multiple name took a sharp turn for the worse after the company preannounced Q3 revenue far below Street expectations. Both instrument and consumable demand saw surprising weakness, which combined with limited forward visibility, makes this a challenging stock to recommend in the near-term."
Barclays analyst, Nandita Koshal, said, "We present a preview of the upcoming earnings season. Focus names are Agilent (NYSE: A), Illumina Inc (Nasdaq: ILMN), Waters (NYSE: WAT). This quarter has been a moving target, with the macro outlook impacted by policy uncertainty. More recently though, stabilization of the U.S. growth outlook, Chinese monetary policy steps to improve liquidity in the SME sector, and EU policymakers' apparent willingness to facilitate an orderly deleveraging process, has led our Portfolio Strategy team to expect a decline in the extreme levels of equity market correlation, which may be the catalyst for a continued equities advance through 4Q11."
"With risks still skewed to the downside for 2012, we prefer names with one or more of these traits - internal levers to drive earnings, relatively robust
end-markets/product cycles, and strong balance sheets. WAT and Thermo Fisher Scientific (NYSE: TMO) stand out as more resilient names, in our view. Agilent and ILMN are stocks with strong negative sentiment overhangs, but upcoming potentially positive catalysts."
WAT is a high-quality cyclical play; Top-pick. Contrary to market concerns around a Q3 miss, we believe WAT saw robust demand for key products like the H-class and Xevo TQ-S through Q3, and solid backlog build for recently launched products (I-class and Synapt G2-S)...ILMN: the pendulum has swung. Sentiment on this high multiple name took a sharp turn for the worse after the company preannounced Q3 revenue far below Street expectations. Both instrument and consumable demand saw surprising weakness, which combined with limited forward visibility, makes this a challenging stock to recommend in the near-term."
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