PNC Financial Services, Energizer Holdings, Wal-Mart, Owens Corning and RPM International

CHICAGO--([ BUSINESS WIRE ])--[ Zacks Equity Research ] highlights PNC Financial Services (NYSE: [ PNC ]) as the Bull of the Day and Energizer Holdings (NYSE: [ ENR ]) the Bear of the Day. In addition, Zacks Equity Research provides analysis on Wal-Mart (NYSE: [ WMT ]), Owens Corning (NYSE: [ OC ]) and RPM International (NYSE: [ RPM ]).

Full analysis of all these stocks is available at [ http://at.zacks.com/?id=2678 ].

Here is a synopsis of all five stocks:

[ Bull of the Day ]:

We are initiating our coverage on the shares of PNC Financial Services (NYSE: [ PNC ]) with an Outperform rating. The company's third-quarter earnings were significantly ahead of the Zacks Consensus Estimate, benefiting from strong revenue performance, reduced costs and increased clients.

The company continues to strengthen its balance sheet with focus on risk and expense management. Application of these strategies should propel PNC Financial forward. Moreover, benefits from the National City acquisition continue to exceed the company's expectations.

On the downside, there will be continued credit-related costs along with dividend payments and regulatory interference associated with TARP in the near term. However, with more than half of the revenues derived from the fees business, we expect the company to enhance income with an improvement in market conditions.

[ Bear of the Day ]:

Energizer Holdings' (NYSE: [ ENR ]) fourth-quarter results missed the Zacks Consensus Estimates due to lower sales in Household Products and an adverse currency impact. The company expects growth in earnings for fiscal 2010 driven by continued reduction in overhead costs.

The company stands to benefit from restructuring initiatives, product innovations, strong cash flow and increased debt repayment. However, weaker margins, a delay in stock buybacks, intense competition, a sluggish battery business and increased marketing spending are potential negatives.

We downgrade the stock to Underperform as the company has been hit hard by the global economic crisis, leading to weak demand and prices for its battery business. We expect the negative impact of the economic downturn to continue in the near term. Our six-month price target is lowered to $54.00.

Latest Posts on the Zacks [ Analyst Blog ]:

Initial Jobless Claims Back Up

On Tuesday, the New York Times had a very interesting (and depressing) story based on a poll of the unemployed about the effects joblessness has had on them and their families. More than 60% of the unemployed have had to tap into their retirement accounts to make ends meet (and getting a good swift kick in the gut from the IRS for doing so), almost half are without health insurance (even though the ARRA subsidizes COBRA payments) and more than half have cut back on going to the doctor. More than a quarter have either been threatened with eviction or foreclosure, or have actually lost their home.

Economically, those extended benefits have allowed those people to continue to spend on basic necessities. If they had been unable to do so, then the cashiers and stock people at Wal-Mart (NYSE: [ WMT ]) would have been laid off, since they would not have been able to shop there. The truckers working for YRC would not have had as many loads to haul, and many of them would have been laid off.

Because the unemployed are the people who are most likely to spend an incremental dollar the fastest (but also relatively unlikely to spend it frivolously) the money they get tends to have a very large multiplier effect. Thus, it is not just for humanitarian reasons that the extended benefit program has been a good thing. However, finding a way to create real new jobs so they don't need the extended benefits would be an even better thing by a very large margin.

Unfortunately, while the pace of layoffs has come way down (the big drop in initial jobless claims is good evidence of this) the pace of job creation has not started. Regardless of the overall economic conditions, there are always both layoffs and new hiring going on, but it is the relative levels of both that shows up in the jobless claims data. The evidence very much suggests that the problem is on the uptake side, rather than on the new additions side.

The recent "Cash for Caulkers" plan proposed by President Obama strikes me as a very good idea in this regard. It targets one of the professions (construction workers) that has been hardest hit in this downturn. Over the last year, construction employment has fallen by almost 1 million and is almost 1.8 million, or 23% below the peak level set in January of 2007.

In addition to the direct construction worker jobs, it would also stimulate employment at companies like Owens Corning (NYSE: [ OC ]) and RPM International (NYSE: [ RPM ]). The ancillary benefit would be that it would significantly increase the nation's energy efficiency, and reduce out trade deficit over the long run.

Get the full analysis of all these stocks by going to [ http://at.zacks.com/?id=2649 ].

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.

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PNC Financial Services, Energizer Holdings, Wal-Mart, Owens Corning and RPM International