Zacks Bull and Bear of the Day Highlights: Sinopec, Rackable Systems, Rockwell and NewMarket.

CHICAGO -- Zacks Equity Research highlights Sinopec (NYSE: SNP) as the Bull of the Day and Rackable Systems (Nasdaq: RACK) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Rockwell Automation (NYSE: ROK) and NewMarket Corp. (NYSE: NEU). Full analysis of all four stocks

Here is a synopsis of all four stocks:

Bull of the Day:

Our Bull of the Day recommendation is for China Petroleum & Chemical Corporation, or Sinopec (NYSE: SNP). Sinopec recently reported strong operational results for 2006. While a number of uncertainties remain, we believe that the near- to medium-term environment supports its continued upstream production growth and downstream capacity expansion. Moreover, Sinopec's integrated petrochemical and refining businesses are expected to benefit from possible price reform for refined products in China. Therefore, we are maintaining our Buy recommendation on Sinopec.

Bear of the Day:

Our Bear of the Day recommendation is for Rackable Systems (Nasdaq: RACK). After having the market for high-density, low-power, servers to itself, larger competitors have entered the market where Rackable Systems competes. Industry leaders have much greater resources than Rackable and have competed aggressively on price. As a result, Rackable has had to cut prices to its largest customers, resulting in a drop in gross margin to 18.8% in Q406 from the earlier low twenties level, and likely much lower in Q1 2007. We therefore downgrade the shares of RACK to Sell with a six month target price of $10.50.

Analyst Blog:

Rockwell Automation (NYSE: ROK) is the world's largest industrial automation company, providing power, control and information solutions to improve manufacturing productivity. December quarter top and bottom-line missed consensus estimates. Forward guidance indicates that revenue is expected to increase 7-8% in fiscal 2007. The Power systems division has been divested for $1.8 billion. This has the impact of raising margins. We believe that the market has not yet impounded the recent attractive growth and earnings rates and is instead focusing on the automobile segment. Consequently, we are reiterating our Buy rating on the shares.

Growth in the petroleum additives business, price increases, and falling debt levels are some of the factors making us positive about NewMarket Corp.'s (NYSE: NEU) performance in the near-term. Additionally, management's efforts to control costs and improve manufacturing efficiencies have enhanced the company's operating leverage. Thus, we reiterate our Buy rating on the stock. Management expects the additives business to continue posting strong numbers due to improved demand. The company has also been successful in instituting meaningful price increases to combat the impact of rising raw material costs. Although the current price increases are not enough to restore the company's profitability to prior levels, they are expected to cover the rising costs in the long term.

Get the full analysis of all four stocks by going to http://at.zacks.com/?id=2649.

About the Bull and Bear of the Day

Every day, the analysts at Zacks Equity Research select two stocks that are likely to outperform (Bull) or underperform (Bear) the markets over the next 3-6 months.

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