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: Alkermes, Inc. (Nasdaq: ALKS) and Campbell Soup Company (NYSE: CPB).

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

Here are highlights from Friday's Analyst Blog:

Upgrading Alkermes to Buy

Alkermes, Inc. (Nasdaq: ALKS) is a drug delivery biotech company which utilizes specialized drug delivery technologies to develop drugs for the treatment of some major diseases. Its expertise in the area of drug delivery has allowed it to develop a pipeline of extended-release injectable and pulmonary drug products for the healthcare industry.

We are optimistic about a number of mid- to late-stage candidates and the recent launch of Vivitrol. We expect to see strong top-line growth in the coming years with profitability in fiscal year 2008. Valuation is attractive at current price, so we upgrade Alkermes shares from Hold to Buy with a target price of $18.

Notes on Employment

The Department of Labor released a shockingly strong employment report this morning:

"Nonfarm employment increased by 167,000 in December, and the unemployment rate was unchanged at 4.5 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Job gains occurred in several service-providing industries, including professional and business services, health care, and food services. Average hourly earnings rose by 8 cents, or 0.5 percent, in December."

The consensus view among economists had been for an increase of about 100,000 jobs, and that number had been dropping in the run-up to the report, especially after the ADP report was released on Wednesday which forecast a decline of 40,000 jobs. There were three areas of weakness on the jobs front: Construction (-3,000), Manufacturing (-12,000) and Retail (-9,000). However, the weakness in those areas was swamped by strength in the business and professional services (+50,000), Education and Health (+43,000), Leisure and Hospitality (+31,000) and Government (+17,000). The 167,000 gain was relative to a 137,000 gain preliminarily reported for November, but that figure was revised upwards to a gain of 154,000 jobs. The rise in average hourly earnings was also much stronger than expected, and it is good to see Joe Six-Pack finally enjoying some benefit from the current economic expansion. Over the last year, wages are up 4.2%.

The strong report, both on the headline and the revision to November's numbers, substantially reduces the likelihood of a near-term (first quarter) cut in the fed funds rate. Not that it was all that high to start with, but it also lowers the chances of a second quarter cut. Thus the bond market is not happy about the report. I consider this report to be good news, as more jobs and higher wages will keep the consumer relatively strong and will help offset the effects of the housing ATM shutting down. In the first quarter, I expect to see more job losses in the construction sector, but if the underlying pace of job creation elsewhere in the economy is running closer to 150,000 jobs a month than 100,000, the effect on the overall economy of the construction job losses is likely to be fairly muted.

Costs to Affect Campbell's

Campbell Soup Company's (NYSE: CPB) Transformation and Driving Quality Growth Plans are improving the top-line through a combination of improved products, attractive packaging, a new retail shelving system and more effective marketing. Price increases in fiscal 2006 helped Campbell accomplish management's financial goals.

However, fiscal 2007 will see increased spending on marketing and the implementation of SAP in the United States, along with continued inflationary pressure from higher commodity costs. Hence, the Hold rating is maintained.

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

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