Whole Foods and other updates
Whole Foods announced earnings and the stock dropped $6.7 or ~4%.
I'm not worried. 4 weeks ago this stock was $125, and today it closed at $140. That's still a 11% bump. And frankly WFMI always does this - surges before earnings, dips and then eases up. The model portfolio bought at a short term high, but we had to start somewhere.
My main reason for liking WFMI is margin strength and sales growth. They didn't fail me - sales forecasts were raised from the previous 15%+ zone to a 20%+ zone. That's always a good thing. Of course, that's a bit softer than past results and I want to keep my eye on that - we want sales acceleration.
If you want to look for negatives, consider their earnings slump: dropped from $28M last year to $9M. They had two special one-time events: Katrina and stock option expensing.
But come on - a stock split, dividend increase AND A $4 PER SHARE SPECIAL PAYOUT. They are feeling quite fine.
JetBlue also looks strong. Did anyone else notice the report that they want to buy more planes? They are demand driven - buying as demand increases, so that's a sign that they expect to see demand growing. Considering that competition has announced a reduction in flights due to low demand and costs, that's a sign of strength.
And the kicker? They announced plans to sell 7M shares to raise funds to buy the planes BUT THEY INCREASED THE OFFERING DUE TO STRONG DEMAND. Institutional demand is a VERY important factor in a stock price. Look at trading volume the last 3 months - it's surging.
What you want to look at is the impact of oil - before oil went crazy this summer, JBLU was moving up. Oil is finally dropping again, and that should release some margin pressure. All signs are positive.
RTLX released earnings. As expected last quarter was a triumph. Sales up 55% and earnings up ~250% Y/Y. As expected - the stock didn't budge. Better buy now before they break the $250M sales barrier and Institutions begin to notice. Right now, <8% is in the hand of institutions. My favorite laugh was UBS downgrading them to a hold. Yeah, how many companies have a 55% growth in sales, 250% in earnings, a relatively low P/E, but are a hold. That analyst is a fool.
Last but not least: DESC is up 24% this week. A new high for this stock. What happened? More institutional interest in an up and coming company.
I'm not worried. 4 weeks ago this stock was $125, and today it closed at $140. That's still a 11% bump. And frankly WFMI always does this - surges before earnings, dips and then eases up. The model portfolio bought at a short term high, but we had to start somewhere.
My main reason for liking WFMI is margin strength and sales growth. They didn't fail me - sales forecasts were raised from the previous 15%+ zone to a 20%+ zone. That's always a good thing. Of course, that's a bit softer than past results and I want to keep my eye on that - we want sales acceleration.
If you want to look for negatives, consider their earnings slump: dropped from $28M last year to $9M. They had two special one-time events: Katrina and stock option expensing.
But come on - a stock split, dividend increase AND A $4 PER SHARE SPECIAL PAYOUT. They are feeling quite fine.
JetBlue also looks strong. Did anyone else notice the report that they want to buy more planes? They are demand driven - buying as demand increases, so that's a sign that they expect to see demand growing. Considering that competition has announced a reduction in flights due to low demand and costs, that's a sign of strength.
And the kicker? They announced plans to sell 7M shares to raise funds to buy the planes BUT THEY INCREASED THE OFFERING DUE TO STRONG DEMAND. Institutional demand is a VERY important factor in a stock price. Look at trading volume the last 3 months - it's surging.
What you want to look at is the impact of oil - before oil went crazy this summer, JBLU was moving up. Oil is finally dropping again, and that should release some margin pressure. All signs are positive.
RTLX released earnings. As expected last quarter was a triumph. Sales up 55% and earnings up ~250% Y/Y. As expected - the stock didn't budge. Better buy now before they break the $250M sales barrier and Institutions begin to notice. Right now, <8% is in the hand of institutions. My favorite laugh was UBS downgrading them to a hold. Yeah, how many companies have a 55% growth in sales, 250% in earnings, a relatively low P/E, but are a hold. That analyst is a fool.
Last but not least: DESC is up 24% this week. A new high for this stock. What happened? More institutional interest in an up and coming company.
posted by Andrew at
7:55 PM
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