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  • SEC Filings Round Up: Lowe's Earnings, Smithfield’s Activists & Geron’s Buying 0 comments
    Apr 3, 2013 9:06 AM | about stocks: LOW, HD, LL, SFD, GERN

    SEC filings provide investors with a great source of information, ranging from annual reports and activist filings to insider purchasing and spin-offs. In this SEC filings round up, we'll take a look at Lowe's 10-K annual report, Smithfield's activist situation, and Geron's recent insider purchase and what it means for investors in these companies.

    Lowe's 10-K Shows Signs of Improvement

    Lowe's Companies Inc. (LOW), a home improvement retailer in the United States, Canada and Mexico, reported FY 2012 revenues that increased 0.6% to $50.5 billion due to a recovering housing market that led to a 1.3% higher average ticket amount and a 1.4% increase in comparable sales, according to the company's recent 10-K filing with the SEC.

    With Freddie Mac projecting home sales to jump 8-10% and housing starts to increase to 950,000 during 2013, home improvement retailers like Lowe's should continue to benefit from the trends. The company expects FY 2013 sales to increase approximately 4% with 10 new stores opening, while its margins are expected to improve 60 basis points.

    Compared to others in the sector, like The Home Depot Inc. (HD) or Lumber Liquidators Holdings Inc. (LL), Lowe's is attractively priced with lower P/E, P/S and P/B ratios.

    Smithfield Targeted by Activist in 13D Filing

    Smithfield Foods, Inc. (SFD), a provider of fresh and packaged meats domestically and internationally, has been the target of an activist investor since early March 2013. Continental Grain recommended in a 13D/A filing that the Board of Directors engage an independent investment banking firm to evaluate various alternatives.

    These suggestions include splitting the company into three independent firms, instituting a share repurchase or dividend, adding board members with experience in new agribusiness segments, and tying management compensation to performance. In response, Reuters reported that the company hired Goldman Sachs to weigh its options.

    But on April 1st, Reuters reported that JP Morgan analyst Ken Goldman believes that the company's latest move indicates a potential struggle between the company and investors.

    Geron's John Scarlett Makes Big Buy

    Geron Corporation (NASDAQ: GERN), a biopharmaceutical company developing therapies for cancer, Chairman and CEO John Scarlett recently purchased 50,000 shares in the open market, according to a Form 4 filing with the SEC. At a price of $1.03 per share, the purchase made in his family trust increases his ownership stake to 125,000 shares.

    The move comes after a tough quarter for the company, where it reported significant progress in its clinical development programs and a lower net loss than the year ago period, but failed to impress analysts covering the stock. Highlights for the year included top-line results from its trial in essential thrombocythemia and preliminary results from its biomarker multiple myeloma trial.

    Given the timing of the CEO's purchase shortly after the earnings results hit the stock price, the move could have been made in response to the market's reaction to the results.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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