Donnelley Upgraded to Strong Buy - Analyst Blog
August 07 2013 - 7:05PM
Zacks
On Aug 3, 2013, Zacks Investment Research upgraded R.R.
Donnelley (RRD) to a Zacks Rank #1
(Strong Buy). With a strong year-to-date return of 116.4% and a
positive estimate revision trend, Donnelley is an attractive
investment opportunity.
Why the Upgrade?
Impressive second quarter results, incremental revenue growth from
acquisitions, robust logistics result and improving liquidity
contributed to the upgrade. Additionally, Donnelley’s multi-million
dollar contract wins from various companies remain a major positive
catalyst.
Donnelley reported second quarter earnings of 45 cents per share
that comfortably surpassed the Zacks Consensus Estimate by a couple
of cents. Revenues increased 1.7% year over year to $2.57 billion
and exceeded the Zacks Consensus Estimate by approximately $30.0
million.
Donnelley’s logistics business recorded robust organic revenue
growth of 14.0% on a year-over-year basis, primarily driven by
incremental revenues from acquisitions. Double-digit volume growth
helped premedia revenues to grow 15.0% organically. Book directory
and variable print unit organic revenues declined 2.4% and 0.6%,
respectively in the quarter.
Donnelley reiterated its fiscal 2013 guidance. The company expects
revenues to be in the range of $10.1 billion to $10.3 billion. The
guidance assumes approximately $100.0 million negative impact from
foreign exchange rates and lower paper sales.
The Zacks Consensus Estimate for fiscal 2013 increased 2.5% to
$1.62 per share as most of the estimates were revised higher over
the last 7 days. For fiscal 2014, the Zacks Consensus Estimate
jumped 8.6% to $1.65 per share over the same period.
The long-term expected earnings growth rate for Donnelley is
7.5%.
Other Stocks to Consider
Investors can also consider other stocks that are doing well right
now. These include Activision Blizzard
(ATVI), Barrett Business Services
(BBSI) and Moody’s Corp
(MCO). While Activision and Barrett carry
a Zacks Rank #1 (Strong Buy), Moody’s carries a Zacks Rank #2
(Buy).
ACTIVISION BLZD (ATVI): Free Stock Analysis Report
BARRETT BUS SVS (BBSI): Free Stock Analysis Report
MOODYS CORP (MCO): Free Stock Analysis Report
DONNELLEY (RR) (RRD): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
Donnelley (R.R.) & Sons Co. (NYSE:RRD.WI)
Historical Stock Chart
From Jun 2024 to Jul 2024
Donnelley (R.R.) & Sons Co. (NYSE:RRD.WI)
Historical Stock Chart
From Jul 2023 to Jul 2024