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: Pfizer Ltd. (NYSE: PFE), Biogen Idec (Nasdaq: BIIB), Amgen (Nasdaq: AMGN), Intel Corp. (Nasdaq: INTC) and Advanced Micro Devices, Inc. (NYSE: AMD).
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Here are highlights from Wednesday’s Analyst Blog:
9 Possible Pharma Deals for ‘09
With everyone reporting and blogging over the past few weeks that Pharma M&A activity should heat up in 2009, we've decided to make nine bold predictions on deals that could get done -- or that at least make sense to us -- in 2009.
1.) Pfizer Ltd. (NYSE: PFE) is sitting on over $30 billion in cash and the Lipitor patent expiration in 2012 is bearing down like a freight train. Management needs to find new areas of growth. Pfizer has also mentioned in the past that they are keen on expanding the biologic business.
With "all deal sizes" on the table, the best move we see for Pfizer in 2009 is to acquire big-cap biotech firm Biogen Idec (Nasdaq: BIIB). We have heard rumors of a Pfizer-Amgen (Nasdaq: AMGN) combination, but Biogen would be a lot easier to swallow. The deal would give Pfizer several new revenue drivers and an enormous biologic pipeline for about a fourth of the price of Amgen. Biogen's core focus in central nervous system disorders, oncology, and inflammatory disease is just what Pfizer is looking for. Biogen also bring a massive biologic manufacturing footprint that will help Pfizer commercialize its next-generation portfolio.
Intel: 3 Concerns Plus Another
Intel Corp. (Nasdaq: INTC) has experienced very slow growth over the last four years. This was mainly due to Advanced Micro Devices, Inc. (NYSE: AMD) emerging as a competitor in the microprocessor, motherboard and chipset markets.
Costs have continued to outpace revenue growth. Against the 12.1% revenue increase in the 2004-2007 period, COGS [cost of goods sold] increased 24.9%, while operating expenses (R&D and SG&A) increased 10.8%. This brought down the operating margin from 30.1% in 2004 to 25.6% in 2007. While 2008 could develop into a good year in terms of operating margins, we expect margins to decline again in 2009.
Although notebooks are growing strongly, the company is seeing increasing demand for the lower-end variety. This is mainly due to the increasing demand from several emerging economies.
It now appears as though you can add macro economic and inventory concerns to the mix, as the firm warned for the 2nd time this quarter that revenue would be falling to levels not seen since the June of 2006 quarter. ($8.2 billion).
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