Zacks Analyst Blog Highlights: Gushan Environmental Energy Ltd., ZOLL Medical Corp., ArthroCare Corp., Orchid Cellmark, Inc. and Charlotte Russe Holdings, Inc.

CHICAGO--(BUSINESS WIRE)--Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Gushan Environmental Energy Ltd. (NYSE: GU), ZOLL Medical Corp. (Nasdaq: ZOLL), ArthroCare Corp. (Nasdaq: ARTC), Orchid Cellmark, Inc. (Nasdaq: ORCH) and Charlotte Russe Holdings, Inc. (Nasdaq: CHIC).

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Here are highlights from Tuesday’s Analyst Blog:

Gushan Environmental Bullish

China's biggest bio-diesel player Gushan (NYSE: GU) is ramping up its production capacity in a big way to cater to the strong energy demand fueled by China's fast growing economy. The company's proprietary technology allows it to use cheaper sources of raw material and have a lower cost structure than its peers.

Looking ahead, lower fuel subsidies by the government, higher production and entry into the high margin chemical market should collectively generate significant earnings growth. However, loss of production due to the Beijing Olympics will affect performance in the near-term. Also, strong governmental control over diesel prices, volatility in global oil prices, and rising Chinese inflation continue to weigh on the stock.

ZOLL Medical Taking Heart

ZOLL Medical Corporation (Nasdaq: ZOLL) designs, manufactures and markets non-invasive cardiac resuscitation solutions. These solutions include defibrillation devices with/without the pacing option, such as ZOLL's M Series, E Series, R Series, AED Plus, AED Pro, and LifeVest Wearable Defibrillator.

We previously increased our FY08/FY09 revenue estimates and increased our FY09 EPS estimate. Management previously increased its FY08 revenue guidance and revealed preliminary FY09 guidance. As in FY07, management expects operating expense leverage to again support earnings growth in FY08/FY09.

ArthroCare Downgraded to Hold

The near-term should be difficult for ArthroCare Corp. (Nasdaq: ARTC) investors as the company navigates the delayed filing of financial statements, FBI probe, and class action suits. The Centers for Medicare and Medicaid Services’ non-coverage determination combined with the DiscoCare litigation will likely damage the Spine segment. Our recommendation moves to Hold.

Given the current headline risk, we are surprised that the company trades at an 8% premium to the average of comparables 1.2x 2008 P/E/G. We believe most health plans and governments will seek to cut costs. We are adjusting our estimates to reflect the potential fallout as the management is diverted from normal business operations. Using a blend of P/S and P/E/G, we value the stock at $33.

Orchid Cellmark a DNA Play

Princeton, NJ-based Orchid Cellmark, Inc. (Nasdaq: ORCH) is a leading provider of DNA testing services for forensic, human identity and agricultural applications in the U.S. and the U.K. The company recently expanded its reach in the U.S. with the acquisition of Reliagene in October 2007. The company is now leveraging its expertise in DNA testing to enter into new markets like pork traceability, immigration testing and security applications.

The company has won a major part of the mega tender in the U.K., which will result in annual revenues of $10 million for the next 3 years. As such, we maintain our Buy rating on the stock with a target price of $6.

Charlotte Russe Stays a Sell

Charlotte Russe Holdings, Inc. (Nasdaq: CHIC) is a mall-based specialty apparel retailer, which carries both branded and private-label merchandise, targeting women in their teens and twenties. The retailer offers a broad assortment of fashionable merchandise.

We reiterate our Sell rating on Charlotte Russe shares. In July, the company reported soft results for the fiscal third quarter and issued disappointing guidance for the fiscal fourth quarter. Economic conditions have worsened in the last two months, which has added to Charlotte Russe's problems.

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