Sign in Subscribe
Pharmaceutical industry

Stocks in Focus: BRE Properties, Eli Lilly, Northrop Grumman, Strayer Education, and Marathon Oil

Strategic Insights

— 2 min read

BRE Properties, a large West Coast apartment REIT, has announced a dramatic slowdown in new construction spending, while Eli Lilly & Co. is facing challenges due to pipeline disappointments and generic competition to key drugs. Northrop Grumman Corp. is well-positioned to take advantage of growth areas in the defense budget, and Strayer Education remains a buy with strong financial results and double-digit EPS growth. Meanwhile, Marathon Oil Corporation's production shortfalls and weak commodity-price realizations are expected to negatively impact its fourth-quarter 2008 results.

Key Takeaways:

  • BRE Properties has slowed down new construction spending, stopping pre-development activities at three sites on the West Coast and laying off 33 development-related employees, resulting in a $0.10 per share charge in the 4th quarter.
  • Eli Lilly & Co. is entering a challenging period due to recent pipeline disappointments, including uncertainty surrounding antiplatelet drug prasugrel, and is expected to experience negative longer-term EPS growth due to generic competition to key drugs.
  • Northrop Grumman Corp. has a strong program portfolio positioned to take advantage of growth areas in the defense budget and offers a diversified revenue and earnings stream with strong growth and discounted relative valuation metrics.
  • Strayer Education has reported financial results above expectations for the past eleven quarters and is expected to continue with double-digit EPS growth, driven by positive pricing through annual 5% tuition increases.
  • Marathon Oil Corporation's production shortfalls and weak commodity-price realizations are expected to negatively impact its fourth-quarter 2008 results, which will be reported on February 3, 2009.

Statistics:

  • BRE Properties will take a $0.10 per share charge in the 4th quarter due to the slowdown in new construction spending.
  • Eli Lilly & Co. is expected to experience negative longer-term EPS growth due to generic competition to key drugs.
  • Northrop Grumman Corp. supplies a broad array of products and services to the U.S. Department of Defense, including electronic systems, information technology, submarines and surface ships, aircraft, space technology, and systems integration services.
  • Strayer Education has reported financial results above expectations for the past eleven quarters.
  • Marathon Oil Corporation's production is expected to average 415,000 oil-equivalent barrels per day (BOE/d) in the fourth quarter.

Sources:

  • Zacks Equity Research, "BRE's Development Slowdown", [http://at.zacks.com/?id=4579](http://at.zacks.com/?id=4579)
  • Zacks Equity Research, "Lilly Faces Challenges Ahead", [http://at.zacks.com/?id=4579](http://at.zacks.com/?id=4579)
  • Zacks Equity Research, "Northrop Grumman Nicely Priced", [http://at.zacks.com/?id=4579](http://at.zacks.com/?id=4579)
  • Zacks Equity Research, "Strayer Education Remains a Buy", [http://at.zacks.com/?id=4579](http://at.zacks.com/?id=4579)
  • Zacks Equity Research, "Oil Drop Weighs on Marathon", [http://at.zacks.com/?id=4579](http://at.zacks.com/?id=4579)
  • About Zacks Equity Research, "About Zacks Equity Research"
  • About Zacks, "About Zacks"
  • Visit [http://www.zacks.com/performance](http://www.zacks.com/performance) for information about the performance numbers displayed in this press release.

Read more