5. Regions Financial (RF)
Company profile: Regions Financial, with a market value of $10 billion, and with $122 billion in assets, is a financial holding company that operates 1,800 banking offices in 16 states mostly in the Sunbelt. Its operations include banking, brokerage and investment services, as well as mortgage banking and insurance brokerage.
Dividend Yield: 0.56%
Investor takeaway: Its shares are up 67% this year and have a three-year, average annual return of 11.5%. Analysts give its shares three "buy" ratings and four "holds," according to a survey of analysts by Morningstar. S&P has it rated "hold," with an $8 price target. Its shares are currently at $7.16.4. Gap Inc. (GAP) Company profile: Gap, with a market value of $17 billion, is a specialty apparel retailer that operates Gap, Banana Republic and Old Navy stores. They sell casual clothing to moderate, upscale and value-oriented consumers. The company operates more than 3,000 corporate-owned stores throughout the U.S., Canada, Western Europe and Japan, and 250 franchise stores internationally. Dividend Yield: 1.32% Investor takeaway: Its shares are up 107% this year and have a three-year, average annual return of 39%. Analysts give its shares seven "buy" ratings, four "buy/holds," 14 "holds," one "weak hold," and four "sells," according to a survey of analysts by S&P. Analysts' consensus estimate is for earnings of $2.07 per share this year, and growth of 11% to $2.30 next year. S&P reiterated its "sell" rating last week, noting the valuation, which it says indicates investors are assuming a second-half turnaround for retail sales that might come. But in July, Gap posted 10% higher same-store sales and 12% higher total sales. 3. Seagate Technology (STX) Company profile: Seagate, with a market value of $15 billion, manufactures hard disk drives used in computer servers, PCs, laptops and personal-entertainment players. Of the company's revenue, 65% to 75% comes from original-equipment manufacturers. Dividend Yield: 3.59% Investor takeaway: Its shares are up 122% this year and have a three-year, average annual return of 46%. Analysts give its shares seven "buy" ratings, two "buy/holds," 11 "holds," one "weak hold," and two "sells," according to a survey of analysts by S&P. Analysts' consensus estimate is for earnings of $7.54 per share this year and a decline of 9% to $6.87 per share next year. S&P analysts recently lowered the firm's opinion on the shares to "buy" from "strong buy," on valuation concerns (the shares are now at S&P's 12-month price target of $35), but it says "we still believe it has strong fundamentals." 2. Sprint Nextel (S) Company profile: Sprint Nextel, with a market value of $15 billion, is the third-largest wireless carrier in the U.S., serving 48 million customers directly and 8.4 million via resellers, using two separate nationwide networks. Investor takeaway: Its shares are up 122% this year and have a three-year, average annual return of 11%. Analysts give its shares 10 "buy" ratings, seven "buy/holds," 16 "holds," two "weak holds," and three "sells," according to a survey of analysts by S&P. UBS Securities upgraded it to "buy" from "neutral" at the end of July (the same rating as S&P) after second-quarter earnings indicated a significant increase in the outlook for EBITDA (earnings before interest, taxes, depreciation and amortization) and free cash flow over the next three years is warranted. 1. Regeneron Pharmaceuticals (REGN) Company profile: Regeneron, with a market value of $13 billion, develops products that fight inflammation, cancer and eye disease. Investor takeaway: Its shares are up 149% this year and have a three-year, average annual return of 86%. Analysts give its shares eight "buy" ratings, three "buy/holds," and seven "holds," according to a survey of analysts by S&P. S&P has it rated "hold" because it sees "modest upside" for its shares given their run-up, which has been driven by strong demand for its new product Eylea. That drug has been FDA-approved for the treatment of wet age-related macular degeneration. For fiscal 2013, analysts estimate earnings per share will grow by 33% to $4.70.
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