Safeway, Nortel, CBS, Equifax

Safeway stock looks set to appreciate, while Nortel looks like a relative bargain.
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A selection of some of the most intriguing stock newsletter suggestions on the Web. The items presented do not represent the views of TheStreet.com; rather, the collection is offered as a service to our members who may be scanning the Web for stock-related information.

Safeway

Gregory Spear

(3/3)

Gregory Spear of

The Spear Report

and a number of other newsletter editors are recommending

Safeway

(SWY)

on the strength of its recent performance and growth.

The grocer recently acquired

Carr-Gottstein Foods

in Alaska and overcame concerns it would have a monopoly in the state by selling three stores and promising to form a consumer advisory committee, says Spear.

Safeway's stock did not rise as high as Spear would have liked when the company announced better earnings than analysts estimated. But he explains that the market may have still been digesting an announcement of a secondary offering of 19.5 million Safeway shares the day before the earnings announcement. Nevertheless, Safeway is selling for about 35 times earnings, lower than rival

Kroger's

(KR) - Get Report

price-to-earnings ratio of 39. "Look for Safeway's stock price to appreciate more than Kroger's in the coming months," says Spear.

More information can be found at:

www.investools.com

Nortel

Forbes.com

(3/4)

Shares of Canadian telecom giant

Nortel

(NT)

are a bargain next to those of

Lucent

(LU)

, says

Forbes Digital Tool

. Nortel shares are selling at 27 times estimated earnings for the next 12 months while Lucent is selling for 43 times forward earnings. Thus, investors are paying a 60% premium for Lucent.

Meanwhile, Nortel has embarked on an ambitious cost-cutting program, even while spending some $2.6 billion on research and development. A new network platform called Succession will allow telecom carriers to upgrade existing systems to the Internet protocol without destroying their existing networks. The Succession network "may reduce operating costs by 45% and capital expenditures by 50% due to a converged network,"

ABN-Amro

analyst Kenneth Leon tells

Forbes Digital Tool

.

TD Securities

analyst Paul F. Litva tells the publication that he sees Nortel's earnings coming in at $2.26 this year and $2.67 next year vs. $1.86 in 1998.

More information can be found at:

www.forbes.com

CBS

Online Investor

(3/1)

CBS

(CBS) - Get Report

Chief Executive Mel Karmazin is known for giving good quotes and enjoying the effects of them. And he created a stir when he said CBS would love to buy rival network

NBC

from

General Electric

(GE) - Get Report

, and that he would also be happy to "overpay for NBC just like we overpaid for the

NFL

." Wall Street initially reacted with shock, says

Online Investor

, but cooler heads soon realized the difficulty of such a merger.

The biggest and seemingly most immovable barrier is the fact that the

Federal Communications Commission

does not allow one television network to take over another. Indeed, it bars any one network from controlling more than 35% of the U.S. viewership.

CBS, though it leads the ratings among the largest networks, does not make money. For 1998, CBS reported losses of $12 million from continuing operations, or 2 cents per share, compared with a loss of $131 million, or 24 cents per share, for 1997. NBC makes money for its parent, General Electric, though some analysts think the network hit its peak in profitability in 1997.

The stock is trading near its 52-week high of 37. "Now if CBS could just find a way to get itself profitable, which would help to justify its current price, that would be icing on the cake," says

Online Investor

.

More information can be found at:

fnews.yahoo.com

Equifax

Eric McKissack

(2/26)

Equifax

(EFX) - Get Report

, the provider of consumer and commercial credit information, took a big hit in January because of an earnings shortfall. But Eric McKissack of

Ariel Capital Management

, blames the earnings disappointment on an isolated problem at a U.K. subsidiary and says that it will not happen again. Meanwhile, the stock reflects fears that the problems could spread to other divisions, he says.

But McKissack points out that the company has strong cash flow, has been buying back shares and has been eliminating lower-margin operations. The stock weakness is a buying opportunity, he says. He foresees earnings of $1.55 a share this year and $1.90 next year, up from $1.34 in 1998.

McKissack sees the stock hitting the high 40s within the next 12 to 18 months. It trades around 36 currently.

More information can be found at:

www.techstocks.com