For Immediate Release

Chicago, IL – January 09, 2017 –Zacks Equity Research highlights EMCORE (NASDAQ: EMKR – Free Report ) as the Bull of the Day and Opus Bank (NASDAQ: OPB – Free Report ) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Visa Inc. (NYSE: V – Free Report ) and Wal-Mart Stores, Inc. (NYSE: WMT – Free Report ).

Here is a synopsis of all four stocks:

Bull of the Day :

After a stellar end to 2016 for chip stocks it’s easy to believe the rally is a bit long in the tooth. While these stocks have historically higher beta than the rest of the market, they’re not exactly at the cornerstone of the post-Election Trump rally. In fact, lots of these companies could be threatened under the new administration’s policies, especially if anything resembling a trade war with China develops.

However, new technologies and changes in internet infrastructure have fueled the fire for chip stocks. Specifically, I’m talking about the shift to 4k, 100Gb switches, and anything having to do with increasing bandwidth. Today’s Bull of the Day is a company that offers a broad portfolio of compound semiconductor-based products for the broadband, fiber optic, satellite and terrestrial solar power markets.

EMCORE (NASDAQ:EMKR – Free Report ) is a Zacks Rank #1 (Strong Buy) with a Momentum Style Score of B in an industry that ranks in the Top 8% of our Zacks Industry Rank. A big reason for the favorable rank is the recent bullish moves analysts have made with regards to their earnings estimates for the current quarter, next quarter and the current year. Four analysts have increased their estimates for the current quarter, while three have done so for the current year. The moves have pushed our current quarter Zacks Consensus Estimate from 5 cents to 10 cents and have increased our current year number from 23 cents to 34 cents.

It was these estimates along with a fantastic quarterly report that set EMKR off on huge spike higher. Shares went from below $6.75 to nearly $8.75 in the first session following their last report where earnings came in at 8 cents versus expectations calling for 4 cents. The stock rallied in the days following the report, eventually hitting a fresh 52-week high of $9.50 before beginning to retreat. Now the stock has pulled back as the Commodity Channel Index (CCI) has dipped below oversold territory under -100 at -152. I’m looking for the CCI to reverse a little bit and push up through the zero line before adding to an existing long position in one of the portfolios I run here at Zacks.

Bear of the Day :

Among top beneficiaries of the Trump rotation following Election Day are regional banking stocks. These smaller banks benefit for a few reasons. First, there’s the belief that rates will rise next year. Some think that under a Trump Presidency they will rise at a faster rate than they would have under Hillary Clinton. Higher rates are great for banks because they help their net interest margin, which is the difference between what they pay customers in interest and what they make on their lending and other banking actions.

The other big boost for banks is hope in the underlying American economy. People believe that increased GDP growth will generally benefit financial institutions. Another reason is more specific to these smaller banks. They are often the lender of choice for small business in America. If President Trump makes good on his promise spend big money on American infrastructure projects then small businesses will expand, borrowing money, and again helping the smaller regional banks.

That being said, I don’t believe you should go out there and buy every regional bank you lay your eyes on. You need to do a little bit of research on the banks you invest in if you are in fact buying individual names. Today’s Bear of the Day is Zacks Rank #5 (Strong Sell)Opus Bank (NASDAQ: OPB – Free Report ).

Opus Bank provides various banking products, services, and solutions for small to mid-sized companies, entrepreneurs, real estate investors, professionals, and high net worth individuals. It offers demand deposits, checking accounts, money market accounts, savings accounts, and certificates of deposit. The company also provides multifamily residential loans, commercial real estate loans, commercial business loans, small business administration loans, construction loans, and single-family residential and consumer loans; and loans and lines for working capital, expansion, acquisitions, consolidation, and transition. As of December 6, 2016, it operated 56 banking offices, including 32 in California, 21 in the Seattle/Puget Sound region in Washington, 2 in the Phoenix metropolitan area of Arizona, and 1 in Portland, Oregon.

The stock took a frightening tumble during the month of October, diving from $35 to $18 in less than two weeks. Since that dip shares have recovered most of the move, getting back near $30 with the post-election rally.

The reason for the Zacks Rank #5 (Strong Sell) is the drastic cut in earnings estimates the stock has seen from analysts. Over the last ninety days, analysts have dropped their estimates for the current year and next year. The bearish sentiment has cut our Zacks Consensus Estimate for the current year from $2.26 to $1.32 while slashing next year’s number from $3.13 to $1.94.

Additional content:

Wal-Mart Lifts Visa Credit Card Ban in Canada

Visa Inc. (NYSE:V – Free Report ) has finally reached an agreement withWal-Mart Stores, Inc. (NYSE: WMT – Free Report ), which would allow acceptance of Visa credit cards as a form of payment in all Canadian Wal-Mart stores. The latest move undoubtedly seems to put an end to the lingering tussle over credit card transaction fees between the payment network giant and the retail behemoth.

On Jun 11, 2016, in a surprising announcement, Wal-Mart’s Canadian wing stated that it would stop accepting Visa in all its stores across Canada, citing that Visa charges “unacceptably high” card transaction fees.

Walmart Canada – which pays more than $100 million in fees to accept credit cards as payment options from customers – had then mentioned “Lowering costs such as these (credit card transaction fees) is necessary for us to be able to keep our prices low and continue saving our customers money.”

Meanwhile, on Jun 16, 2016, Visa, in an open letter to cardholders and merchants in Canada, claimed that it offered Walmart “one of the lowest rates of any merchant in Canada” and “they are using their size and scale to give themselves an unfair advantage.” Visa also noted that Walmart is “using their own customers as negotiating leverage by stating that they will no longer accept Visa cards at Walmart stores.”

Walmart Canada commenced its move to drop Visa cards, in mid July 2016, with three stores in Thunder Bay. After the companies failed to agree on an “acceptable fee” for Visa transactions, Walmart stopped accepting Visa credit cards at its 16 stores in Manitoba from Oct 2016.

However, following the latest agreement, Wal-Mart’s customers in Manitoba and Thunder Bay, Ontario, can use their Visa credit cards from Jan 6, 2017.

Visa’s shares have gained 7.8% in a year’s time, underperforming the 11.7% growth for the Zacks categorized Financial Transaction Services industry. Though the company remains well poised for growth on the back of its solid market position and significant opportunities from the secular shift toward electronic payments, some key near-term concerns include high client incentives and weakness in the European economy.

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About the Bull and Bear of the Day

Every day, the analysts at Zacks Equity Research select two stocks that are likely to outperform (Bull) or underperform (Bear) the markets over the next 3-6 months.

About Zacks Equity Research

Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Continuous analyst coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

Strong Stocks that Should Be in the News

Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year. See these high-potential stocks free >>.

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EMCORE Corporation (EMKR): Free Stock Analysis Report
 
Opus Bank (OPB): Free Stock Analysis Report
 
Visa Inc. (V): Free Stock Analysis Report
 
Wal-Mart Stores, Inc. (WMT): Free Stock Analysis Report
 
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