Zacks Bull and Bear of the Day Highlights: Valero Energy, Onyx Pharmaceuticals, Freeport-McMoRan and Rackable Systems.

CHICAGO -- Zacks Equity Research highlights Valero Energy Corp. (NYSE:VLO) as the Bull of the Day and Onyx Pharmaceuticals (Nasdaq:ONXX) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Freeport-McMoRan Copper & Gold (NYSE:FCX) and Rackable Systems (Nasdaq:RACK). 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 Valero Energy Corp. (NYSE:VLO). Valero continues to be our core play on the U.S. refining market given the size, geographical diversity, and complexity of it operations. We believe that the broad contours of the U.S. refinery scene will continue to remain favorable, characterized by robust margins and wider crude-quality spreads. We are raising our earnings estimates and maintaining our Buy recommendation to reflect this positive backdrop. Our new 2006 and 2007 EPS estimates are $8.32 and $8.48, up from $7.56 and $8.05, respectively.

Bear of the Day:

Our Bear of the Day recommendation is for Onyx Pharmaceuticals (Nasdaq:ONXX), which is engaged in the development of novel cancer therapies that target the molecular basis of cancer. We are cautious on the future for oncology drug Nexavar (sorafenib). Unfortunately, Nexavar has entered a highly competitive market and data on Pfizer's Sutent at ASCO outshined that of Nexavar. We believe Nexavar sales will continue to grow over the next several years, but fail to achieve meaningful penetration unless additional clinical trials demonstrate utility in other indications. We would avoid the name despite the significant stock decline already. Our target is $12.

Analyst Blog:

Freeport-McMoRan Copper & Gold, Inc. (NYSE:FCX) is engaged in the exploration, development, mining and milling of copper, gold, and silver in Indonesia. The company is witnessing strong growth backed by improved productivity levels and a strong cash flow position. However, rising interest rates, expected low-grade ore, and the risk of disruptions in Indonesia lead us to rate the stock a Hold. We currently have a six-month target price of $54.00 on the shares.

Rackable Systems (Nasdaq:RACK) is a niche player in the large, growing market for servers based on industry standard x86 components and Windows or Linux operating systems. The company differentiates itself with its patent portfolio on high-density server configurations, which we believe will help it drive strong margins and continue its rapid growth trajectory. However, we believe much of this is already reflected in the price. We therefore maintain our Hold recommendation and raise our six-month price target to $37.50.

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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Updated throughout every trading day, the Analyst Blog provides analysis from Zacks Equity Research about the latest news and events impacting stocks and the financial markets.

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