Zacks Analyst Blog Highlights: Medtronic, Kyphon, Carnival Plc and Royal Caribbean.

CHICAGO -- 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: Medtronic (NYSE: MDT), Kyphon (Nasdaq: KYPH),

See the latest posts to the Analyst Blog by visiting: http://at.zacks.com/?id=2673

Here are highlights from Friday's Analyst Blog:

Update on Kyphon Buyout News

Medtronic (NYSE: MDT) is acquiring Kyphon (Nasdaq: KYPH) for $71 per share in cash, with the deal expected to close in Q108. However, with early Hart-Scott-Rodino antitrust termination from the FTC [Federal Trade Commision] and DOJ [Department of Justice], and German approval, the deal could possibly close sooner than expected. The shareholder vote is set for October 16.

The company also received partial approval on its acquisitions of Disc-O-Tech, but will likely need to divest the vertebroplasty assets, including the Confidence system. Our price target remains at $71.00.

We believe the $71 per KYPH share deal is a good strategic fit for Medtronic and fair for Kyphon shareholders. Given the merger, and the strong likelihood of the deal closing, our price target remains at $71.00, and our rating remains Hold.

Carnival Still Trades at a Premium

We maintain our Hold rating for Carnival Plc (NYSE: CUK) following the release of solid third quarter operating results. We expect Carnival to continue to trade at a premium to its largest competitor over the near-term. However, given our expectation for flat operating margins and continued pricing pressure in the Caribbean, we do not feel that further material price appreciation is warranted at this time.

Carnival has historically traded at a slight premium to Royal Caribbean (NYSE: RCL), based on forward price-to-earnings multiples. This relationship still holds, based on current prices and our forward 12-month EPS estimates for both companies.

While Carnival plc is trading at 13.6x of estimated 2008 earnings, Royal Caribbean is currently trading at 11.4x estimated 2008 EPS. We expect Carnival to continue to trade at a premium over the near-term. Our six-month target price of $50 is based on a multiple of approximately 15x our 2008 earnings estimate.

See the latest posts to the Analyst Blog by visiting http://at.zacks.com/?id=2645

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