Business Week: S&P Picks and PAns 10/17/2007

Business Week provides analysis of picks and bearish stocks for the S&P regularly. Today's report picks some of the best and worst in what they have recently analyzed. Take a look at a few I thought were the most intereesting, but go to their page for the complete list and analysis.

S&P REITERATES STRONG BUY OPINION ON SHARES OF ALTRIA GROUP


MO; $71.04

MO reports third quarter EPS of $1.24. Before tax benefits and asset impairment charges, operating EPS of $1.21 vs. $1.07 easily beat our $1.12 estimate. Results benefited from revenue growth on market share gains in the U.S. and from acquisitions and currency benefits internationally. The company boosted its 2007 EPS guidance to $4.20-$4.25, now matching our $4.25 estimate. With the spin-off of MO's international operations likely to be announced in early 2008, we are maintaining our sum-of-the-parts analysis-derived 12-month target price of $85. /R. Mathis
S&P REITERATES BUY OPINION ON SHARES OF COCA-COLA CO.


KO; $59.17

KO reports third quarter EPS of 71 cents vs. 62 cents, topping our 67 cents estimate on stronger-than-expected international results. Revenues rose 19% on a 6% increase in sales of concentrate, positive currency impact, and acquisitions. With what we view as a more aggressive push to increase volumes in the U.S., and the introduction of new products overseas, we see these benefits continuing into 2008. We are raising our 2007 EPS estimate by 9 cents to $2.64, and our 12-month target price by $9 to $67, which at about 23 times our 2008 EPS estimate of $2.95, is a discount to peer average. /R. Mathis
S&P REITERATES STRONG BUY RECOMMENDATION ON SHARES OF TIFFANY & CO.


TIF; $54.74

At this morning's meeting in its new Wall Street store, TIF also detailed a planned smaller 2,000 square foot format for U.S., tentatively called Tiffany & Co. Collections. With first opening planned for 2008, TIF sees potential for 70 stores besides the original 100 target for 5,000 sq. ft. U.S. units. We like the new format for higher potential economic returns, but do not expect impact on near-term results. We believe TIF business continues to be strong here and internationally and are encouraged by LVMH Moet's report Monday of accelerated sales in Japan, a key TIF market. /E. Kwon, CFA All stocks