Zacks Bull and Bear of the Day Highlights: SABESP, U.S. Cellular, Canon and HSBC Holdings.

CHICAGO -- Zacks Equity Research highlights SABESP - ADR (NYSE: SBS) as the Bull of the Day and U.S. Cellular (NYSE: USM) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Canon Inc. (NYSE: CAJ) and HSBC Holdings plc (NYSE: HBC). Full analysis of all four stocks is available at http://at.zacks.com/?id=2676.

Here is a synopsis of all four stocks:

Bull of the Day:

Our Bull of the Day recommendation is for SABESP - ADR (NYSE: SBS). We are keeping our Buy recommendation on Companhia de Saneamento Basico do Estado de Sao Paulo, or SABESP. The company recently posted better-than-expected results for the third quarter of 2006, and its stock still trades at an attractive price. Additionally, the company should benefit from the new regulatory framework recently approved in the Brazilian Congress and the positive business environment in Brazil. Finally, SABESP has been reducing the amount of its debt denominated in U.S. dollars. As a result, we expect more stable earnings and cash flow in the near future.

Bear of the Day:

Our Bear of the Day recommendation is for U.S. Cellular (NYSE: USM). Financial reporting delays at U.S. Cellular and the recent 52-week high for its share price have intensified the risk and uncertainty associated with the current valuation level. Over the near-term, we do not believe U.S. Cellular would be a part of consolidation activities, outside of TDS full ownership. Given that TDS already controls most of the shares outstanding, it is unlikely that it will have to pay a large premium for the remaining shares of USM. We maintain our Sell recommendation based on the current valuation level, timing uncertainty of audited financial information, and our expectation that share demand may be in a near-term decline until complete financials are presented.

Analyst Blog:

Canon Inc. (NYSE: CAJ) is one of the world's leading designers, manufacturers and marketers of office equipment, cameras and optical products. The company's investment in digital cameras has given it an industry leadership position and contributed significant growth to overall corporate results. However, increasing price competition in the printer market and slowing demand for some of its optical products are a concern. We, therefore, maintain our Hold rating on CAJ and raise our six-month price target to $58.50.

We are continuing our Hold on HSBC Holdings plc (NYSE: HBC) as well as our $93 target price. In its third quarter trading update, HSBC reported that revenue growth slowed from the first half rate due to lower loan growth and margin pressure in consumer and weaker trading results at the investment bank. Consumer impairment charges rose, while commercial credit was benign. We are continuing our EPADS estimates at $7.75 for 2006 and $8.30 for 2007. Earnings should be supported by strong loan and deposit growth and improved productivity, though we expect higher loan losses. In the first half, HSBC posted earnings of $9.2 billion, up 16% from 2005. We believe HSBC's $3.80 annual dividend, which provides a 4.2% yield, is safe.

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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