R.R. Donnelley: It Prints Just About Everything, But the Money
Guest blogger: Larry Schutts, vice president of Stockwinners.com and a contributing editor for Theflyonthewall.com. Larry looks for stocks with technical and fundamental characteristics indicating gains in the next 30 days. However, price movements may be volatile. He includes a stop-loss price in each post. Consider selling a position should the stop-loss be violated.
That brochure, catalog, magazine, annual report, directory or retail
insert you read that daylight was nearly certainly prepared by a
commercial printer. One of the most highly respected practitioners of
the art is headquartered in Chicago.
R.R. Donnelley & Sons Company (NYSE:RRD)
provides printing and print-related services to companies in the
advertising, financial services, health care, retail and technology
industries. Products include magazines, catalogs, books, advertising
materials, trade forms, financial reports and telephone directories.
The firm plus offers pre-press graphics and post-printing distribution
services. Clients include AT&T (NYSE:T), Hewlett-Packard (NYSE:HPQ) and J C Penney (NYSE:JCP).
The company surprised the Street earlier in the week, when it reported Q3 EPS of 81 cents and revenues of $2.91 billion.![]()
Analysis had been expecting 74 cents and $2.89
attributed success to increased productivity and to the firm’s ability
to leverage its global platform to drive efficiency. Management plus
guided FY07 EPS to $2.85-$2.88, versus consensus of $2.80. The share
price popped on the news and thereupon moved into a bullish “flag”
consolidation sample. Stocks frequently exit flags moving in the same
direction they were traveling on entry. In that case, thatwould be to
the upside.
Brokers recommend the issue with two “strong buys,”
two “buys” and three “holds.” The RRD Price to Sales ratio (0.79),
Price to Book ratio (2.10), Price to Cash Flow ratio (10.61), Price to
Free Cash Flow ratio (18.94), Sales Growth rate (26.04%) and EPS Growth
rate (20.90%) compare favorably with industry, sector and S&P 500
averages. Institutional investors hold about 90% of the outstanding
shares. The stock is one of those used to calculate the S&P 500
Index. by the past 52 weeks, it has traded within $32.59 and $45.25.
A stop-loss of $34.90 looks good here.
Original post by Tom Taulli
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