Summary Points: Historically, Bed Bath & Beyond outpaced its category and has consistently grown sales and profits. Dropping margins have been the biggest issue in the last year. Stock is cheap. Market is pricing in a very dim future. Online sales are expanding at over 20% yoy. A random basket of 40 items was found to be cheaper than Amazon.com. Most Americans … [Read more...]
Archives for October 2016
Time Warner: No Deal = Not A Good Bet
Summary Points: WSJ view that TWX is a Good Bet regardless if deal happens or not. TWX has decent numbers with strong margins and uses FCF for dividends and buybacks. Valuation is at high end and thus not an attractive holding without the deal. This morning I was reading the famous Wall Street Journal column "Heard on the Street". One article was titled "Deal or … [Read more...]
A Global Giant At A Reasonable Price
Summary Points: The 2nd largest airline in the world with the best PRASM. Airlines have been a major beneficiary of the decline in oil. Sideways moving oil will maintain profits. Reducing debt while paying over 70% of FCF to shareholders. Delta is cheap versus the industry and market. Delta Air Lines (NYSE:DAL) is the 2nd largest airline in the world. Its … [Read more...]
Close To 6 Year Lows With Potential Upside
Summary Points: Specialty retailer that has grown at double-digit growth rates has been stalling. Trades at a discount to historical multiples and to its major competitor GNC. Potential catalysts: Sale of GNC, Sale of VSI, Activist, Operational improvement. Vitamin Shoppe (NYSE:VSI) is a specialty retailer of vitamins, minerals, herbs, supplements, sports … [Read more...]
Be Cautious On Wabash National As Backlog And Industry Trailer Orders Drop
Summary Points: Since the economic crisis, the company has done well, growing sales, margins and profits. An established, well-known brand that does well in times of growth. It's time to be cautious as industry trailer orders have been declining. Earnings after-hours: Investors should focus on backlog, margins and what management has to say about … [Read more...]
Pier 1: Opportunity Not There Yet
Summary Margins and Comparable Sales, Total Sales have been in decline and getting worse. Company specific issues as BBBY is doing much better. Company bought back shares while performance decline was accelerating. CEO leaving and management fighting activist through poison pill. Stock could tank if guidance misses. … [Read more...]
Newsletter – September 2016
Everyone is jumping on the ETF bandwagon as $63.6 billion flowed into the product YTD versus $144 billion outflow from equity mutual funds. Fidelity launched six new ETFs with “smart beta” and large cap filling the headlines. For smart beta fans I recommend a smart piece from James Montier (click here) who makes the case that: Smart Beta = Dumb Beta + Smart Marketing. Now … [Read more...]
