KMG Chemicals, Black Hills, CounterPath, EGain And SeaChange International Highlighted As Zacks Bull And Bear Of The Day

For Immediate Release

Chicago, IL – Dec 29, 2017 – Zacks Equity Research highlights KMG Chemicals (NYSE:KMG) as the Bull of the Day and Black Hills Corporation (NYSE:BKH) as the Bear of the Day. In addition, Zacks Equity Research provides analysis ontheCounterPath, Corp. (NASDAQ:CPAH) , eGain Corporation (NASDAQ:EGAN) and SeaChange International, Inc. (NASDAQ:SEAC) .

Here is a synopsis of all five stocks:

Bull of the Day:

KMG Chemicals is a Zacks Rank #1 (Strong Buy) and is the Bull of the Day following a strong beat of the Zacks Consensus Estimate. Let's take a look at the recent quarter, estimate revisions and the valuation for this stock.

Description

KMG Chemicals manufactures, markets and distributes specialty, niche chemicals. The company manufactures, markets and distributes three wood preserving chemicals, pentachlorophenol, creosote and sodium pentachlorophenate, to industrial customers engaged in the wood preserving business. The company's customers use these preservatives to treat wood and supply the treated wood products to end-users in a variety of industries, principally the railroad, utility and construction industries.

Recent Quarter

On December 11, the company reported EPS of $0.83 when $0.63 was expected. The $0.20 beat translates into a 31% positive earnings surprise.

The company had revenue of $111M, which was 3.8% higher than the estimate of $107M.

As a result of the beat on top and on bottom, investors bid up shares of KMG by 15% in the session following the release.

Revisions

Estimates for KMG are moving in the right direction. The July 2018 fiscal year has a $3.17 number as the Zacks Consensus Estimate and that is up from the $2.76 level it stood at in November.

Most investors are looking ahead to next year, even with this company reporting a mid-year fiscal year end. The Zacks Consensus Estimate for next year has moved from $2.40 in September to $3.21 in November and is now at $3.71. This is just what investors want to see.

Valuation

KMG trades at 21x forward earnings and that is just below the 22x industry average. I see a 2.9x book multiple, and that too is well below the industry average of 5.7x.

Growth is something that I look for, and I am pleased to see the July 2018 fiscal year is looking at 35% topline expansion. The analysts might not have a clear view out to the July 2019 year end as they only have 5% growth projected, but in a few months that number could move materially higher.

Bear of the Day:

Black Hills Corporation has slipped to a Zacks Rank #5 (Strong Sell) and is now the Bear of the Day. Let's take a look at why this stock has the lowest Zacks Rank.

Description

Black Hills Corporation is an energy company that generates wholesale electricity and produces natural gas, crude oil and coal. They serve natural gas and electric utility customers in Arkansas, Colorado, Iowa, Kansas, Montana, Nebraska, South Dakota and Wyoming.

Recent Earnings

The company reported a miss of the Zacks Consensus Estimate on November 2. The company saw EPS of $0.50 when $0.55 was expected. Revenues came in $47M shy of the estimate as well.

Investors sold the stock as a result of the earnings and the stock lost 5% in the session following the earnings release.

Estimates

Before the third consecutive miss, the company was expected to post $3.52 in EPS for 2017, but that number moved down to $3.35 in November and ticked lower by another penny in December.

The 2018 numbers also fell from $3.65 in October to the current level of $2.47.

Additional content:

3 Buy-Ranked Tech Stocks That Soared in December

It has been an up-and-down month for technology stocks, as sector-wide volatility that started in November continued throughout the past few weeks. Nevertheless, the tech sector dominated Wall Street for the majority of 2017, and as we look at the year’s highest-flying stocks, most of the recognizable names are dominant and innovative technology brands.

Considering the current state of the world, tech’s leadership makes sense. Cloud computing and the Internet of Things have already revolutionized our everyday life, and now we are on the cusp of artificial intelligence and autonomous vehicle revolutions that could redefine what it means to be human.

In response to these changing times, investors have poured money into the tech sector in search of the next explosive stock. Even with December’s volatility, we witnessed plenty of noteworthy tech companies start to pick up momentum, including several that are sporting strong Zacks Ranks and other key metrics.

Check out three tech stocks that soared this month to buy now:

1. CounterPath, Corp.

CounterPath designs desktop and mobile application software, including voice over Internet protocol, unified communications, and fixed-mobile convergence solutions. The stock is currently a Zacks Rank #2 (Buy) and has soared more than 40% over the past four weeks.

Our consensus estimate for the company’s upcoming fiscal year earnings has risen by 13 cents within the last 30 days. The firm is now expected to be profitable and improve its EPS results by over 1,000% next year. CounterPath is also witnessing cash flow growth of 16%, and its P/S ratio of 1.55 comes at a significant discount to the “Computer – Software” industry average.

2. eGain Corporation

eGain provides web customer interaction, social customer interaction, and contact center applications. It is a growing name within the expanding customer engagement cloud solutions space. The stock is currently a Zacks Rank #2 (Buy) and has gained over 50% within the past four weeks.

eGain is still in the red, but the firm has outperformed our estimates in two consecutive quarters. Our current consensus estimates are calling for the company to improve its EPS results at an annualized rate of 10% over the next three to five years. Revenues are expected to grow by over 7% next year, and with a P/S of 2.50, investors are getting a decent price for that sales picture right now.

3. SeaChange International, Inc.

SeaChange develops products that help television and broadcast companies manage, store, and distribute digital video. The company’s most recent quarter resulted in earnings that crushed our consensus estimate by over 800%. The stock is now a Zacks Rank #1 (Strong Buy) and has soared more than 48% over the past four months.

The Zacks Consensus Estimate for SeaChange’s full-year earnings has now gained 11 cents within the last 30 days. Looking towards next year, the company is projected to witness EPS growth of 33%. A renewed focus on a SaaS business model has helped the company attract customers and become more efficient.

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.

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