Zacks Analyst Blog Highlights: Hibbett Sporting Goods, ValueClick, aQuantive and Marchex.

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: Hibbett Sporting Goods (Nasdaq:HIBB), ValueClick

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

Here are highlights from Monday's Analyst Blog:

Initiating HIBB a Hold

We are initiating coverage of Hibbett Sporting Goods (Nasdaq:HIBB) with a Hold rating. While we believe the company's small market focus and store expansion strategy should bode well for its long-term growth, we think much of that growth is already priced into its stock price. At its current price-to-earnings multiple, it looks to be fairly valued. That said, we think the company's solid recent results and track record should limit the stock's downside over the next six months. However, we would become more positive on the stock on a pullback.

Hibbett Sporting Goods operates sporting goods stores that are around 5,000 square feet in small to midsized markets in the Southeast, Mid-Atlantic, and Midwest. The company's stores offer athletic equipment, footwear and apparel. The company operated 590 Hibbett Sports stores at the end of the third quarter. Hibbett also operates 18 Sports Additions stores, which are small, mall-based stores, averaging 2,700 square feet with approximately 90% of merchandise consisting of athletic footwear and the remainder consisting of caps and a limited assortment of apparel.

HIBB shares currently trade at 26.3 times our fiscal 2007 EPS estimate and 23.0 times our fiscal 2008 EPS estimate. While we think this valuation is reasonable compared to our estimate of Hibbett's long-term earnings growth rate, we also think it is on the pricey side. Moreover, the stock is up 59% off its summer lows and has limited upside left in the short term. That said, the company's strong results and solid track record should also limit downside in its shares. Accordingly, this reasonably valued stock is rated a Hold.

Increased Risk at ValueClick

ValueClick (Nasdaq:VCLK) is a leader in the online advertising industry, offering advertisers access to over 1,500 publisher websites, and is a leader in online lead generation. We believe spending on online advertising will grow rapidly over the next few years as traditional marketers shift advertising spending away from traditional media and towards online.

However, the company has built its business through acquisitions, providing much of its growth and increasing execution risk. Moreover, a slowdown in the U.S. economy would negatively affect growth. We therefore initiate coverage on VCLK with a Hold rating and a $25.00 price target.

ValueClick provides targeted advertising campaigns to reach online consumers its customers are most interested in and performance-based campaigns where marketers only pay for advertising when it generates a lead or sale. The company's customer base consists of direct marketers, brand advertisers, and the advertising agencies that serve these two groups. ValueClick works with a network of third-party websites and other online publisher partners, which it optimizes for specific marketing goals and generate the audience for its advertisers' campaigns.

At 42.1x our 2006 earnings per share estimates, VCLK is trading at a discount to the industry median of 45.3x and a discount to competitors such as aQuantive (Nasdaq:AQNT) and Marchex (Nasdaq:MCHX). Although we do think the company is well positioned with its leadership position in lead generation and its advertising network, we are concerned about the portion of growth generated from acquisitions and the risk of a slowdown in the U.S. economy. On other metrics, such as price to cash-flow and price-to-sales, the valuation is more in-line with its competitors. We therefore maintain a Hold rating on VCLK shares, and raise our price target to $25, reflecting a P/E multiple of 43.9, closer to its peer group.

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

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