Ecopetrol, Papa John's, Priceline, TripAdvisor and Weight Watchers highlighted as Zacks Bull and Bear of the Day

For Immediate Release

Chicago, IL – November 7, 2017 – Zacks Equity Research highlights Ecopetrol EC as the Bull of the Day and Papa John’s PZZA as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Priceline PCLN, TripAdvisor TRIP and Weight Watchers WTW.

Here is a synopsis of all five stocks:

Bull of the Day:

Ecopetrol (EC) is today’s Bull of the Day and a Zacks Rank #1 (Strong Buy) in an industry which ranks in the Top 2% of our Zacks Industry Rank, but that’s only part of the story. 

Ecopetrol S.A. operates as an integrated oil company. It operates through three segments: Exploration and Production; Transport and Logistics; and Refining, Petrochemical and Biofuels. The company produces crude oil and gas; and engages in the extraction, collection, treatment, storage and pumping, or compression of hydrocarbons. It also transports and distributes hydrocarbons, derivatives, and products.

The main good being produced for Ecopetrol is crude oil. Crude has been very kind lately, breaking out from a downward trend channel in early September, pushing above the 50-day moving average and never looking back. Recently it butted up against resistance in the mid-$50s but has since broken out to the upside. With crude at fresh highs and trouble brewing in Saudi Arabia, crude is off to the races.

You want to talk about a scary ride, just look at the tumble EC took from 2013 through 2015. The stock came all the way down from $60 single digits. That is enough to turn anybody green in the face. Note how the earnings estimates in the multi-colored lines came down throughout those years. Something has changed here recently. Estimates have troughed and taken a turn to the upside. Not only are current year estimates on the rise but there is the promise of growth next year. That turnaround has been a major tailwind for the stock.

Bear of the Day:

Take one look at this “Dad bod” of mine and you’ll see that I’ve never shied away from a pizza. The Chicago pizza snob in me isn’t the reason why I’m making this stock my Bear of the Day. No, I’m putting this one on the naughty list for a simple reason; analysts have been dropping their earnings estimates.

Today’s Bear of the Day is Zacks Rank #5 (Strong Sell) Papa John’s. Papa John’s International, Inc. operates and franchises pizza delivery and carryout restaurants under the Papa John’s trademark in the United States and internationally. It operates through five segments: Domestic Company-Owned Restaurants, North America Commissaries, North America Franchising, International Operations, and All Others. The company also operates dine-in and delivery restaurants. As of December 25, 2016, it operated 5,097 Papa John’s restaurants, including 744 company-owned and 4,353 franchised restaurants.

The company has been handed down a round of negative earnings estimate revisions. Over the last thirty days, two analysts have dropped their numbers for the current quarter, current year and next year. The bearish sentiment has had an impact on our Zacks Consensus Estimate for each of these periods. This quarter’s number has dropped from 86 cents or 74 cents, while the current year acks Consensus Estimate has gone down from $2.85 to $2.77. The most dramatic impact is reflected in next year’s consensus where the number has dipped 7.7% from $3.25 to $3. 

Investors have already felt the pain with the stock coming down from $90 in December to under $59 during Monday’s trading session. Since topping out on December 21^st, 2016, shares have dipped 34.2% while the S&P 500 has rallied 14.5%. Meanwhile, forward valuations have been cratering. After trading over 30x forward 12 P/E to start the year, PZZA now trades at a 20.72 multiple. There’s still plenty of room to the downside as the S&P 500 trades at about 18.7x right now.

Additional content:

Late Monday Q3 Earnings Reports: WTW, PCLN and TRIP

Two web-based travel logistics service companies -- Priceline and TripAdvisor -- are both down in late trading following quarterly earnings results that disappointed, particularly on forward guidance. Priceline, the world's largest travel booker, brought in $35.22 per share on $4.43 billion in quarterly sales, both which beat the Zacks consensus of $34.31 per share and $4.31 billion, respectively. TripAdvisor beat on the bottom line by 2 cents to 36 cents per share on a big sales miss of $439 million, well beneath the $454.3 million expected.

Earnings guidance for both companies have taken the wind out of these stocks in the after-market: Priceline by roughly 6.5% and TripAdvisor by 8%. Priceline's room night booked for next quarter shows a high range of 13%, beneath the 15% consensus. TripAdvisor hosts its earnings call tomorrowmorning, but traders are sending the stock lower largely on weak revenues in the quarter.

For more info on Priceline's earnings results, click here.

Weight Watchers again easily outperformed expectations on both top and bottom lines: 65 cents per share in the quarter amounted to a 35.4% positive surprise, and also swung to a gain year over year from the estimate of 48 cents per share. The trailing 4 quarters for WTW showed an earnings beat average of 34%. Sales in the quarter of $324 million was better than the $316 million expected. Shares of Weight Watchers are up 8.6% in late trading.

For more info on Weight Watchers' earnings results, click here.

Want more stock market analysis from this author? Make sure to follow @Ryan_McQueeney on Twitter!

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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.

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The Priceline Group Inc. (PCLN) : Free Stock Analysis Report
 
TripAdvisor, Inc. (TRIP) : Free Stock Analysis Report
 
Ecopetrol S.A. (EC) : Free Stock Analysis Report
 
Papa John's International, Inc. (PZZA) : Free Stock Analysis Report
 
Weight Watchers International Inc (WTW) : Free Stock Analysis Report
 
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