With any equity, there are generally five large groups of stakeholders - insiders, institutions, option traders, short sellers, analysts and individual investors. While it is hard to track trends among individual investors, we can track the moves and sentiment of the other five stakeholders. Using this as a framework, let's take a look at a household name - Chiquita Brands International (CQB).
Chiquita operates in the consumer goods sector, farm products industry. CQB markets and distributes bananas and fresh produce under the Chiquita and other brand names worldwide. It operates through three segments: Bananas, Salads and Healthy Snacks, and Other Produce. The Bananas segment engages in sourcing, transporting, marketing, and distributing bananas to retail customers and wholesalers. The Salads and Healthy Snacks segment offers packaged ready-to-eat salads under the Fresh Express and other labels; fresh vegetable and fruit ingredients used in foodservice; healthy snacks, including Chiquita Fruit Bites, a single-serve fruit snacks under the Chiquita brand name; and processed fruit ingredient products. The Other Produce segment engages in marketing and distributing fresh fruit and vegetables other than bananas, primarily pineapples, grapes, and avocados in Europe and North America.
So, how are each of the main stakeholders moving on Chiquita?
Insiders - Bullish
Insiders currently hold 1.31 million shares of the 43.9 million share float, or 3% of the outstanding shares. Their stock acquisition activity has been net positive over both the last 3 months and last 12 months, almost doubling the insider position - a very bullish sign.
Institutions - Neutral
There are 46 institutional holders controlling 34.8 million shares, or 79% of the float. The institutions have net reduced positions by 706k shares, or roughly 2% of their ownership and 1.5% of the total float. The net activity was:
- 20 opened new positions
- 51 increased
- 61 reduced
- 21 sold out
- 27 no change
Moves like this are not very dramatic and may represent normal rebalancing of positions. There is nothing really unusual here so let's call this one neutral.
Short Sellers - Neutral
Open short interest was 3.9 million shares as of November 30th, or 9% of the float. This is up about 25% over the last year but down 31% from six months ago. This trend shows the bears were stronger mid-year and while still strong year over year, they are generally losing conviction. These changes are not strong enough to signal a bullish trend, so we'll call this one neutral.
Options - Bullish
Scanning the open contracts, we can generally get a feel for which way the options traders are voting on this stock. The option market is extremely thin for Chiquita, but there are some indications. The top five contract positions are:
- $6 Feb calls - 1511 contracts
- $7 Feb calls - 823 contracts
- $4 Feb puts - 789 contracts
- $7 Dec calls - 674 contracts
- $3 Feb puts - 537 contracts
So of the top five positions, the net is bullish.
Analysts - Bullish
Chiquita has very low analyst coverage so measuring trends is a bit more subjective than objective. However, the action here has been noteworthy. Three months ago, there were 3 holds and 1 sell rating. The most recent reporting has two analyst at a strong buy and one at a buy. This is a very bullish move.
Chiquita's 52 week trading range is $4.62 - $10.57, with the current price of $8.25 in the upper half. Chiquita does not pay a dividend.
Analysts have an average $11.00 price target, or a 25% upside potential from recent trading.
Summarizing, the top five stakeholders are positioning this way:
- Insiders - Bullish
- Institutions - Neutral
- Shorts - Neutral
- Options - Bullish
- Analysts - Bullish
Three bullish and two neutral votes with an estimated 25% upside make Chiquita a stock worth a closer look.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
Additional disclosure: I am not a registered investment advisor and do not provide specific investment advice. The information contained herein is only my opinion based on personal research and offered for informational purposes. Nothing in this article should be taken as a solicitation to purchase or sell securities. Before buying or selling any equity, do your own research and reach your own conclusion. Investing includes risks, including loss of principal.