For Immediate Release

Chicago, IL – July 28, 2014 – 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 the Caterpillar Inc. (CAT-Free Report), Joy Global Inc. (JOY-Free Report), HudBay Minerals, Inc. (HBM-Free Report), Primero Mining Corp. (PPP-Free Report) and First Majestic Silver Corp. (AG-Free Report).

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

Here are highlights from Friday’s Analyst Blog:

Bearish Caterpillar Q2: Red Flag to 3 Mining Stocks

The world's largest maker of mining and construction equipment Caterpillar Inc. (CAT-Free Report) reported a decline in its second quarter revenues yesterday mainly due to weak mining sales, signaling a dreary outlook for the mining industry.

Despite a 17% increase in its earnings, Caterpillar’s share price dropped as the market reacted to the 3% fall in revenues – the sixth sales decline in the past eight quarters. Caterpillar increased its earnings per share guidance for 2014 but scaled back its revenue guidance citing slowing demand in China and turmoil in Russia and the Middle East. Stronger sales of construction equipment in North America, mild recovery in Europe, and operational improvement were the saving grace for the company. This helped drive earnings growth despite lower sales.

Sales were mainly dragged down by a 29% drop in the Resource Industries segment’s sales, which primarily drives its revenues from the sale of mining equipment. Sales were down 35% to 40% in every region of the world except North America. The company noted that orders for mining machinery continue to remain weak.

Even though Caterpillar’s CEO, Doug Oberhelman pointed out that this was the first quarter since 2012 that Resource Industries sales had delivered a sequential improvement, it is too soon to suggest that the mining business is turning around.

Over the past two years, Caterpillar’s mining customers have slashed capital spending in the middle of a glut in capacity, drop in prices for coal, iron ore and other metals and slower economic growth in China and other developing countries. Caterpillar’s competitor Joy Global Inc. (JOY-Free Report) has also borne the brunt of weak demand in the global mining market. To cope with weak mining demand, Caterpillar has resorted to cost cutting initiatives by closing down plants and laying off workers.

This bearish phase of the mining market has dealt a blow to Caterpillar’s long-term objective of becoming a dominant global player in the mining space. Prior to this, Caterpillar, had been riding the wave of heightened construction and mining activity in developing markets, triggered by the demand for coal, copper and iron ore. The company also, aggressively proceeded toward expanding in mining when the market was stronger. Its acquisition of Bucyrus in 2011 for $8.8 billion was an attempt to be a leader among the global mining original equipment manufacturers with the buyout resulting in the most expansive product offering in the mining equipment industry.

As a global supplier of mining and construction equipment, Caterpillar is considered a bellwether of economic activities. In line with Caterpillar’s poor outlook for the mining industry, we suggest three mining stocks to steer clear from at the moment.

3 Mining Stocks to Avoid

HudBay Minerals, Inc. (HBM-Free Report)

Headquartered in Toronto, Canada, HudBay Minerals is an integrated mining company, which mainly focuses on the discovery, production, and marketing of base and precious metals in North and South America.

HudBay currently carries a Zacks Rank #5 (Sell). The stock has delivered an average negative earnings surprise of 122.92% in the past four quarters. Hudbay is currently trading at a P/E of 87.42, at a significant premium to the industry average of 30.28.

Primero Mining Corp. (PPP-Free Report)

Primero Mining is engaged in the acquisition, exploration, development and production of precious metal properties in Canada and Mexico. The company explores for gold and silver. It owns interest in the San Dimas Mine, which is located in Mexico’s San Dimas district; and the Black Fox Complex that is located in the Timmins Mining District in Ontario, Canada.

Primero Mining currently carries a Zacks Rank #4 (Sell). This Vancouver, Canada-based precious metals producer is currently trading at a forward P/E of 87.65, a significant premium to the industry average of 15.00. The company also holds a negative earnings growth estimate of 76.39% for 2014 and an average negative earnings surprise of 38.34% in the past four quarters.

First Majestic Silver Corp. (AG-Free Report)

Vancouver, Canada-based First Majestic Silver Corp. acquires, develops and explores mineral properties with a focus on silver projects in México. The company owns and operates five producing mines and two advanced-stage development silver projects.

This Zacks Rank #4 (Sell) stock is currently trading at a forward P/E of 33.26, at a premium to the industry average of 28.44. The company has delivered an average negative earnings surprise of 22.71% in the past four quarters. Moreover, First Majestic’s fiscal 2014 earnings is projected to drop 45.71% year over year.

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

About Zacks Equity Research

Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today.

About Zacks

Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978. The later formation of the Zacks Rank, a proprietary stock picking system; continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros.

Get the full Report on CAT - FREE
Get the full Report on JOY - FREE
Get the full Report on HBM - FREE
Get the full Report on PPP - FREE
Get the full Report on AG - FREE

Follow us on Twitter: http://twitter.com/zacksresearch

Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts

Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.

Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
http://www.zacks.com

Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.

Read the analyst report on CAT

Read the analyst report on JOY

Read the analyst report on HBM

Read the analyst report on PPP

Read the analyst report on AG


Zacks Investment Research