Zacks Analyst Blog Highlights: Cleveland BioLabs, Dollar Financial, DPL, CarMax and Gafisa S.A.

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: Cleveland BioLabs, Inc. (Nasdaq: CBLI), Dollar Financial (Nasdaq: DLLR), DPL, Inc. (NYSE: DPL), CarMax, Inc. (NYSE: KMX) and Gafisa S.A. (NYSE: GFA).

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Here are highlights from Tuesday’s Analyst Blog:

Cleveland BioLabs Priced Nicely

We advise investors to accumulate shares of Cleveland BioLabs, Inc. (Nasdaq: CBLI) as the specialized company has a rich pipeline of clinical candidates, unique positioning, lack of competition for any product and looks attractive at current levels.

The company uses the unique approach of apoptosis (a form of programmed cell death in multicellular organisms) for treating cancer, tissue protection and radiation protection that targets niche markets. Protectan CBLB502, for the treatment of gastrointestinal effects of acute radiation syndrome, has a market potential of over $300 million in the U.S. alone.

Put Dollars into Dollar Financial

Dollar Financial's (Nasdaq: DLLR) 3Q08 (ended March 31, 2008) diluted earnings of $0.56 per share, were two cents short of our estimates as well as the consensus. Consolidated revenues were up 26.4% and net income increased by 18.3%, based on strong growth in Canada and the U.K. markets. The bottom-line results were partly offset by higher store and regional expenses, reflecting continued expansion and integration of recent acquisitions.

The company acquired 15 stores and opened 14 de novo stores during the quarter. After reviewing the results, we have adjusted our FY08 and FY09 estimates. Relative valuation looks quite attractive at present and therefore, we maintain our Buy recommendation on the shares of DLLR.

Getting in the Green with DPL

As utility company DPL, Inc. (NYSE: DPL) continues to benefit from its stable regulated electric power operations, investors may take comfort in its strategic shift away from volatile, unregulated businesses and focus towards environment-friendly power.

The liquidation of the company’s investment portfolio provides sufficient capital for expanding its operating base, reducing debt and interest expense, buying back stock and/or increasing its dividend. However, lower gross margins, ongoing investigations by the SEC and the IRS, and uncertainty over the successful allocation of new capital toward greater earnings power remain concerns.

Woes Continue for CarMax

CarMax, Inc. (NYSE: KMX), the largest U.S. retailer of used cars, continues to face a difficult environment, largely due to aggressive incentives from manufacturers of new vehicles. Our outlook for the Auto and Auto Parts Sector industry is Negative and we recommend investors to under-weight auto stocks for the time being.

Declining value of used cars in a weak economy and higher funding cost at the CarMax Auto Finance is eroding the company's margins. Moreover, lower earnings, a conservative guidance for 2009, along with higher valuation make us apprehensive about the stock's performance in the near term.

Buy Brazilian Builder Gafisa

We are keeping our Buy recommendation on Gafisa S.A. (NYSE: GFA). First quarter 2008 results were positive. The short-term outlook remains promising as the company's sales are strong and the emergence of a domestic mortgage market has been fueling the Brazilian construction sector.

We believe the less benign monetary policy in Brazil is just a temporary problem. The potential for growth in the local mortgage business is fantastic, and the huge inventory of land already acquired, construction in progress, bank of land and finished units all point to strong earnings and revenues in future quarters.

Currently, Gafisa is trading at 14.2x our 2008 estimated EPS. The valuation is now more attractive as a result of the continued growth on the company's sales and earnings. We remain positive on the Brazilian real estate market for the short-to-medium term outlook.

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