Zacks Industry Rank Analysis Highlights: Corning, Encore Cable, General Cable, Imperial Oil and...

CHICAGO -- Zacks.com releases the latest Zacks Industry Rank. Stocks featured in this week's analysis include Corning (NYSE:GLW), Encore Cable (Nasdaq:WIRE), General Cable (NYSE:BGC), Imperial Oil (AMEX:IMO) and Suncor Energy (NYSE:SU). To see the Zacks Industry Rank and the trend in earnings

Zacks Industry Rank Analysis written by Charles Rotblut, CFA, Senior Market Analysis for Zacks.com.

Talk about March Madness! The major indexes were trading on Friday at levels not seen since the spring of 2001. Much of the earnings news was positive and the economic data released last week did not further fuel inflation worries, thereby providing a backdrop for buying pressure.

Although it is certainly more fun to discuss the markets when prices are rising, nothing has materially changed from two weeks ago (when I described the market as range-bound). Companies are enjoying pricing power. The economy is expanding. Crude prices remain at very elevated levels. And the Fed may not end its streak of hiking interest rates at its March meeting. In other words, the equity markets still have to climb a wall of worry.

Nonetheless, corporate profits are projected to rise this year and next year. In an environment with controlled inflation, higher profits should translate into higher stock prices.

Speaking of higher stock prices, shares of Corning (NYSE:GLW) have more than doubled in value over the past 12 months. Although the stock's valuation is high, estimates for future earnings growth continue to be revised upwards. Forecasts for 2006 profits have been boosted twice within the past 30 days, causing the consensus estimate to rise to $1.02 per share. Behind most recent revisions were bullish comments from the company. Corning's CFO James Flaws recently revised his forecasts for LCD TV penetration to 18%-19% this year and 28%-30% next year; his previous forecasts called for penetration rates of 17% and 25%. Corning is a large supplier of glass substrates for LCD screens.

GLW is one of four stocks helping the Fiber Optics group to have a Zacks Industry Rank of 2.40. Spending on network equipment continues to improve, providing both revenue and profit growth for companies operating in this sector. The increased investment reflects both improving economic conditions and a more competitive telecommunications environment.

When there are similar, external reasons for estimates to be revised for multiple companies within an industry group, often other related groups benefit as well. In the case of telecom and network spending, Wire & Cable Products companies have also been beneficiaries. This group has a Zacks Industry Rank of 2.88 and contains two Zacks #1 Rank stocks - Encore Cable (Nasdaq:WIRE) and General Cable (NYSE:BGC).

Oil has been another sector with multiple groups benefiting from favorable conditions, as is evident by the strength in Oil & Gas-Canadian Integrated. Over the past two months, analysts have raised their 2006 forecasts on Imperial Oil (AMEX:IMO) and Suncor Energy (NYSE:SU). These companies, like many others in the Energy sector, have enjoyed strong margins as a result of higher commodity prices. Plus, both expect production volumes to increase in the future.

About Zacks Industry Rank and the Zacks Rank

Zacks Industry Rank is calculated by averaging the Zacks Rank for all covered companies within a given industry. The Zacks Rank is assigned to approximately 4400 stocks and ranges from #1 ("Strong Buy") to #5 ("Strong Sell"). Both the Zacks Industry Rank and the Zacks Rank are quantitative indicators designed to cover periods of 1-3 months.

For over 18 years, the Zacks Rank has proven that "Earnings estimate revisions are the most powerful force impacting stock prices." Since inception in 1988, #1 Rank stocks have generated an average annual return of +33%. During the 2000-2002 bear market, Zacks #1 Rank stocks gained +43.8%, while the S&P 500 tumbled -37.6%. Also note that the Zacks Rank system has just as many Strong Sell recommendations (Rank #5) as Strong Buy recommendations (Rank #1). Since 1988, Zacks Rank #5 stocks have underperformed the S&P 500 by 143.5% annually (+4.9% vs. +12%). Thus, the Zacks Rank system allows investors to truly manage portfolio trading effectively.

Zacks "Profit from the Pros" e-mail newsletter offers continuous coverage of the industries and the stocks poised to outperform the market. Subscribe to this free newsletter today by visiting http://at.zacks.com/?id=2564.

The Zacks Rank, and all of its recommendations, is created by Zacks & Co., member NASD. Zacks.com displays the Zacks Rank with permission from Zacks & Co. on its web site for individual investors.

About Zacks

Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leonard Zacks. As a PhD in mathematics Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which 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 at http://at.zacks.com/?id=2565.

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.

(a)The Zacks Performance Rank performance is the total return of equal weighted simulated portfolios consisting of those stocks with the indicated Zacks Rank net of fees. Results reflect the reinvestment of dividends and other earnings. Simulated results do not represent actual trading and may not reflect the impact that economic and market factors might have had on decision-making if an adviser were actually managing a client's money.

(b)The S&P 500 Index ("S&P 500") is a well-known, unmanaged index of the prices of 500 large-company common stocks selected by Standard & Poor's. The S&P 500 includes the reinvestment of all dividends, no transaction costs, and represents the gross returns before management fees.

Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.