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The Zacks Analyst Blog Highlights: Caterpillar, 3M Co., Apple, General Electric and Delta Air Lines
[February 05, 2013]

The Zacks Analyst Blog Highlights: Caterpillar, 3M Co., Apple, General Electric and Delta Air Lines

CHICAGO, Feb. 5, 2013 /PRNewswire via COMTEX/ -- 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 Caterpillar (NYSE:CAT), 3M Company (NYSE:MMM), Apple (Nasdaq:AAPL), General Electric Company (NYSE:GE) and Delta Air Lines Inc. (NYSE:DAL).

(Logo: Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: id=5513 Here are highlights from Monday's Analyst Blog: "Re-shoring" Bring Jobs Back to U.S.

The 'offshoring' movement had a profound deleterious effect on the U.S. job market. Entire industries such as electronics, textiles, toys and shoes shifted to China. Consequently, traditional blue collar manufacturing jobs dramatically shrank in number. Employment in manufacturing declined from 32% of the workforce to about 9% at present. The question then arises if some of these jobs will return to the U.S.

If offshoring in manufacturing took jobs to China with its superior supply chain management, modern infrastructure and skilled labor, outsourcing in services worked in India's favor on account of its English speaking population and prevalence of technical education.

Although still only a trickle, 'reshoring,' of manufacturing jobs is shifting some jobs back to the U.S. One survey by the Boston Consulting Group reported that 37% of large American employers were contemplating transfer of manufacturing from China to the U.S. Local U.S-based production is gaining ground on account of varied factors such as a lower logistics and inventory buffer, weaker dollar, lower transport costs and cheaper energy at home.

Further, with wages going up over 15% each year in China along with stagnant pay in America, the wage differential is shrinking. In any case, the share of labor in total manufacturing costs has fallen to as low as 20% in some industries. In such a scenario, low wages are not vital any more for manufacturing widgets.

While reshoring to manufacture small lots in America costs more, the benefits are realized in the form of better response to the consumer, real-time integration of inputs from R&D and marketing, increased goodwill and positive publicity in America. Then, many companies are fond of segmenting the market so that they are able to service American buyers from the U.S. and meet Asian requirements from its hub in China. The just-in-time production model is in vogue.

It is estimated that well over two million total jobs may be created in the U.S. over a period of time but many of these jobs will need sophisticated skills. Low paid Chinese workers were sought by American companies until robots operated by trained American workers at Caterpillar's (NYSE:CAT) East Peoria, Illinois plant were able to do the work for less. The U.S. has evolved to become an advanced production hub in other high profile cases as well. Foreign multinationals, such as Airbus, Honda and Toyota have set up production facilities in America.

Reshoring is already under way with 3M Company (NYSE:MMM) shifting some production back home. Apple (Nasdaq:AAPL) is slated to launch production of the Mac in the U.S. In a well publicized move, General Electric Company (NYSE:GE) will create close to a 1,000 jobs in Kentucky where it will manufacture water heating equipment.

With regard to services, again most of the mundane jobs which could be offshored have already been exported leaving only the cerebral output in the U.S. The reshoring phenomenon has not taken off in services to the same extent, except for call centers which are facing demise in India partly due to accent barriers. Delta Air Lines Inc. (NYSE:DAL) recently transferred 2,000 call center positions from the IT Capital, Bangalore to the U.S.

In the end, companies doing business in America realize that the 'Made in USA' tag holds immense consumer appeal, and not just among Americans.

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About Zacks Equity Research Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today: id=5517 About Zacks is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leon Zacks. As a PhD from MIT Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at id=5518.

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Follow us on Twitter: Join us on Facebook: ref=ts Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.

Media Contact Zacks Investment Research 800-767-3771 ext. 9339 SOURCE Zacks Investment Research, Inc. NewsItemId=CG54419&Transmission_Id=201302050930PR_NEWS_USPR_____CG54419&DateId=20130205

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