Today - Sunday, August 30, 2015
- The London Court of International Arbitration has ordered Volkswagen (OTCQX:VLKAY) to sell its nearly 20% stake in Suzuki Motor (OTCPK:SZKMY), settling a four-year dispute between the automakers over their failed partnership. Suzuki said it will buy back the holdings.
- The two companies agreed to tie up in December 2009, pledging to cooperate on technology and expand in the emerging markets, but the relationship went sour not long after the deal went into effect.
Friday, August 28, 2015
- Procter & Gamble (NYSE:PG) cut CEO A.G. Lafley's bonus by $1.1M as the company missed growth targets this year, according to a proxy statement it issued.
- Lafley got total compensation of $18.3M in the year ended in June, down 6.2% from the previous year's package, mainly due to the smaller bonus of $3.29M.
- P&G has seen slumping performance for years. It set a target of 3% organic sales growth and 5% growh in core EPS for the past fiscal year, but core EPS declined 2%.
- Lafley -- who came out of retirement in 2013 to run the company for the second time -- will become executive chairman on Nov. 1, and David Taylor will take over the CEO role.
- Primark will open its first store in the U.S. on September 10 with an opening in Boston.
- The chain is targeting teenagers and younger millennials with its low-cost lines.
- The company has shown strong growth in the U.K. and other areas of Europe.
- Primark is owned by Associated British Foods (OTCPK:ASBFF, OTCPK:ASBFY).
- Online retailer Bonobos has lost its CEO after just a three-month stint.
- Co-founder Andy Dunn will replace Fran Della Badia.
- NYC-based Bonobos has 19 physical stores open where shoppers can try on different lines of clothing, although orders are still processed online.
- Nordstrom (NYSE:JWN) was an early investor in Bonobos.
- Lululemon (LULU +0.4%) is still well-positioned despite some growing concerns the strong growth trends in athletic apparel are set to wane, according to Oppenheimer.
- The investment firm makes the case in a new note to investors that Lululemon will be able to hold its 15% market share in the U.S. and has significant international upside not fully priced into shares.
- SA contributor Equity Watch broke down the long-term bull case on LULU last month in an article that still resonates.
- LULU trades at $62.91 vs. a 52-week range of $37.81 to $72.00.
- Airline stocks are holding up pretty well considering the strong breakout in oil prices over the last two days.
- The sector didn't rally in full force as oil broke to multi-year lows earlier this week, giving it some leeway with today's move. The wild swings in oil prices also brings the question of hedging strategy back into play. Strategic bets may prime earnings or be a drag depending on timing. American Airlines Group (NASDAQ:AAL) doesn't hedge and just rolls with the market. Delta Air Lines (NYSE:DAL) and United Continental (NYSE:UAL) prefer to hedge against a sudden spike in oil.
- The U.S. Global Jets ETF (NYSEARCA:JETS) is +0.66% on the day, helped in part by a big rally in UAL after its addition to the S&P 500.
- Department store chains increased their market share of beauty sales by a full percentage point to 12.7% over the last five years in a positive sign for the sector.
- The group made its gains in the high-end and niche parts of the beauty market, while conceding some parts of the mass market segment to Sally Beauty Holdings (NYSE:SBH), Ulta Salon (NASDAQ:ULTA), and Walgreens Boots Alliance (NASDAQ:WBA) on pricing.
- J.C. Penney (NYSE:JCP) has been a leader with its striking partnership with Sephora (OTCPK:LVMUY, OTCPK:LVMHF), while Macy's (NYSE:M) +$200M acquisition of Bluemercury sets it up to hit luxury shoppers as well. Kohl's (NYSE:KSS) and Dillard's (NYSE:DDS) also are rolling out new beauty and fragrance lines. Beauty is seen as one of the few categories the chains can drive traffic in effectively with marketing.
- Department stores commanded beauty market share of close to 14% before online sales and discounters started kicking into a higher gear.
- DSW (NYSE:DSW) announces new store openings in McHenry, Illinois and Newport News, Virginia.
- The company is now up to 455 stores after having 449 at the end of Q2 and about 410 at this point a year ago.
- While DSW's sales and EPS have improved over the last year, share price hasn't quite kept up, DSW -7.1% over the last 52 weeks.
- Dividend investors might take note that the company offers a 2.8% yield and carries no long-term debt.
- UBS lines up three transportation stocks it sees as trading at attractive valuations.
- FedEx (FDX -0.2%): The shipping giant trades at a discount to UPS and is leveraged to e-commerce growth, notes the investment firm. The UBS price target of $195 implies 27% upside potential.
- Knight Transportation (KNX +2.9%): Lower fuel costs and strong GDP numbers bode well for the trucking stock. UBS has a price target of $33.
- Kansas City Southern (KSU +0.9%): UBS thinks additional capacity could make a difference for the railroad. A 19% breakout for shares to $111 is seen.
- Related ETFs: IYT, XTN.
- Sportsman's Warehouse (SPWH +7.6%) traded higher after edging past analysts estimates with its Q2 report.
- Same-store sales were flat during the quarter, but total sales were up 7% with new stores in the hopper.
- CEO John Schaefer industry dynamics for the firearm and ammunition categories are normalizing.
- The company sees full-year revenue of $720M-$740M which has a midpoint just ahead of the consensus estimate for $728.1M.
- Previously: Sportsmans Warehouse beats by $0.01, beats on revenue
- Benchmark downgraded GameStop (GME -3.2%) to a Sell rating after all of the retailer's segments missed its estimates for Q2.
- The investment firm is the latest to call into question the core business model of GameStop.
- "We believe the console will complete the turn to digital within the next 5 years," warns Benchmark.
- Benchmark has a $29.76 on GME.
- Some bulls defended the stock today post-earnings. Wedbush raised its PT to $55, while Telsey Advisory is in at $47. During the earnings call, AT&T-branded stores and the integration of ThinkGeek were highlighted by GameStop execs as two earnings drivers.
- Earnings call transcript
9:06 AM| 1 Comment
- Ulta Salon (NASDAQ:ULTA) reports comparable-store sales increased 10.1% in Q2.
- Transactions were 7.0% higher during the quarter, while the average ticket was up 3.1%.
- E-commerce sales shot up 43.4% to $36.1M.
- Higher costs tied to supply chain initiatives contributed to a drop in the company's gross margin rate. The operating income rate was +20 bps to 13.5%.
- Guidance: Ulta Salon sees comparable sales growth of 8% to 10% for the full fiscal year and total sales growth in the mid to high teens percentage rate.
- Previously: Ulta Salon beats by $0.03, beats on revenue (Aug. 27 2015)
- ULTA +0.9% premarket to $161.70.
- Stifel Nicolaus upgrades El Pollo Loco (NASDAQ:LOCO) to a Buy rating from Hold on what it calls "attractive" valuation.
- Growth potential for El Pollo is being underestimated by the market, says analyst Paul Westra.
- The investment firm sets a price target of $17 on the restaurant stock.
- El Pollo Loco is up 3.01% premarket to a flat $13 after a 7% rise yesterday.
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