Big banks have gotten a boost today from JPMorgan Chase’s (JPM) dividend increase, and the hawkish Fed minutes, because higher rates are still expected to help banks out despite what happened last time. In a note previewing Wells Fargo’s (WFC) investor day on May 24, Jefferies analyst Ken Usdin and team write that “higher rates help, but other items weigh on longer-term net-interest-margin potential.” They explain:
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WFC’s Investor Day is 5/24. We expect an upbeat message about strategy, consumer health, and loan/dep. growth, but also expect realism about the environment and changes since the ’14 meeting. In our view, the ROA target could move 10bp lower to 1.2%-1.5%, but ROE, efficiency, and cap. return targets should be unchanged. A harder review of expenses may be in order and WFC can likely find areas that can help drive better efficiency.
Best Forestry Companies For 2016: Safeway Inc.(SWY)
Safeway Inc., together with its subsidiaries, operates as a food and drug retailer in North America. The company operates stores that provide an array of grocery items, food, and general merchandise, as well as features specialty departments, such as bakery, delicatessen, floral, and pharmacy, as well as coffee shops and fuel centers. It also offers SELECT line of products that include baked goods, sparkling ciders and lemonades, salsas, whole bean coffees, frozen pizzas and entrees, and fresh and dry pastas and sauces, as well as an array of ice creams, hors d’oeuvres, and desserts; O ORGANICS line, which comprises milk, chicken, salads, juices, and entrees; Lucerne line of dairy products; Eating Right line of better-for-you products; Bright Green line of home care products; Total Pet Care line of pet foods and pet care products; and Value Red line of value-priced paper goods. As of December 31, 2009, Safeway operated approximately 1,725 stores in California, Oregon, Wash ington, Alaska, Colorado, Arizona, Texas, the Chicago metropolitan area, and the Mid-Atlantic region, as well as British Columbia, Alberta and Manitoba/Saskatchewan. In addition, the company owns and operates GroceryWorks.com Operating Company, LLC, an online grocery channel, doing business under the names Safeway.com, Vons.com, and Genuardis.com; and Blackhawk Network Holdings, Inc., which provides third-party gift cards, prepaid cards, telecom cards, and sports and entertainment cards to North American retailers for sale to retail customers. Additionally, it engages in gift card businesses in the United Kingdom, France, Mexico, and Australia. Further, the company, through a 49% ownership interest in Casa Ley, S.A. de C.V. operates 156 food and general merchandise stores in Western Mexico. The company was formerly known as Safeway Stores, Incorporated and changed its name to Safeway Inc. in February 1990. Safeway was founded in 1915 and is based in Pleasanton, California. Advisors’ Opinion:
- [By Teresa Rivas]
Safeway (SWY) was up nearly 4% after an upgrade to Outperform at Credit Suisse, which also upgraded lululemon (LULU), sending shares up 1%, and downgraded Under Armour (UA)shares were down 1.6%.
- [By Shauna O’Brien]
Shares of Safeway Inc. (SWY) surged on Tuesday morning after announcing that it has adopted a shareholder rights plan to prevent large accumulations of its stock.
The company has adopted a “poison pill” plan as an anti-takeover precaution after becoming aware of a large accumulation of its common stock.
Safeway did not indentify the investor that is accumulating the stock, but noted that this plan will help maintain “fair and equal treatment” to all shareholders.
The plan will dilute the value of the stock by creating more shares, making it difficult for a single investor to acquire large amounts of stock. Shareholders of the company’s common stock as of September 30 will receive one preferred stock purchase right for every share of common stock that they own.
Safeway shares were up $2.38, or 8.49%, during Tuesday morning trading. The stock is up 68% YTD.
- [By Matthew Smith]
In our article on September 16th (located here) we said we were still bullish the grocers and thought that Safeway (SWY) would continue to be a winner along with the industry. Apparently, we were not alone in that thinking as the company announced yesterday that they were putting in place a poison pill which will be good for one year in order to keep anyone from building a stake larger than 10% in the company. The move was prompted by Jana Partners taking a 6.2% stake in the company and the hope of management is that this one-year period will either cool the heels of Jana or allow the two parties to work together rather than going hostile. We personally dislike poison pills, but in this case, it should not be seen as a negative as we doubt anyone was considering assembling a stake at or above that 10% level. Investors cheered the news and sent shares higher by $2.75 (9.74%) to close at $30.99/share on extremely heavy volume of 29.8 million shares.
Best Forestry Companies For 2016: Blue Buffalo Pet Products, Inc.(BUFF)
Blue Buffalo Pet Products, Inc., through its subsidiary, Blue Buffalo Company, Ltd., operates as a pet food company in the United States, Canada, Japan, and Mexico. The company develops, produces, markets, and sells dog and cat food under the BLUE Life Protection Formula, BLUE Wilderness, BLUE Basics, BLUE Freedom, and BLUE Natural Veterinary Diet lines. It also produces and sells cat litter under the BLUE Naturally Fresh line. The company sells its products to retail partners and distributors in specialty channels, including national pet superstore chains, regional pet store chains, neighborhood pet stores, farm and feed stores, ecommerce retailers, military outlets, hardware stores, and veterinary clinics and hospitals. Blue Buffalo Pet Products, Inc. was founded in 2002 and is headquartered in Wilton, Connecticut.
- [By Monica Gerson] Related BUFF Mid-Afternoon Market Update: Crude Oil Rises 3.5%; Zagg Shares Fall Following Weak Q4 Results Mid-Day Market Update: Blue Buffalo Pet Products Rises Following Strong Q4 Results; Ocean Rig UDW Shares Slide Blue Buffalo Pet Products' (BUFF) CEO Kurt Schmidt on Q1 2016 Results – Earnings Call Transcript (Seeking Alpha) Related ARMK Earnings Scheduled For May 11, 2016 Earnings Scheduled For February 10, 2016
Some of the stocks that may grab investor focus today are:
Top Integrated Utility Companies For 2016: Graham Corporation(GHM)
Graham Corporation, together with its subsidiaries, engages in the design, manufacture, and sale of heat transfer and vacuum equipment for the chemical, petrochemical, refining, energy, defense, and electric power generating industries worldwide. The company offers heat transfer equipment, including surface condensers, Heliflows, water heaters, and various types of heat exchangers; and vacuum equipment consisting of steam jet ejector vacuum systems and liquid ring vacuum pumps. It also services and sells spare parts for its equipment; and supplies components used inside reactor vessels and outside containment vessels of nuclear power facilities. The company sells its products directly, as well as through independent sales representatives. Graham Corporation was founded in 1936 and is headquartered in Batavia, New York.
- [By Monica Gerson]
Graham Corporation (NYSE: GHM) is expected to report its quarterly earnings at $0.12 per share on revenue of $23.54 million.
Heico Corp (NYSE: HEI) is estimated to post its quarterly earnings at $0.54 per share.
Best Forestry Companies For 2016: Teck Resources Ltd(TCK)
Teck Resources Limited explores, develops, and produces natural resources in the Americas, the Asia Pacific, Europe, and Africa. Its principal products include copper, including copper concentrates and cathode copper; steelmaking coal; and refined zinc and zinc concentrates. The company also produces lead, molybdenum, gold, silver, germanium and indium, chemicals, and fertilizers. In addition, it holds interest in oil sands projects in the Athabasca region of Alberta; and owns or has interests in 13 mines in Canada, the United States, Chile, and Peru, as well as operates a metallurgical complex. The company was formerly known as Teck Cominco Limited and changed its name to Teck Resources Limited in April 2009. Teck Resources Limited was founded in 1906 and is headquartered in Vancouver, Canada.
- [By Lisa Levin]
On Thursday, basic materials shares rose by 3.08 percent. Top gainers in the sector included Cliffs Natural Resources Inc (NYSE: CLF), Companhia Siderurgica Nacional (ADR) (NYSE: SID), and Teck Resources Ltd (USA) (NYSE: TCK).
- [By Wayne Duggan]
After a brief one-day flip to “sell,” Teck Resources Ltd (USA) (NYSE: TCK) opened Friday’s session with a more than 20 percent gain and triggered a brand new Parabolic SAR buy signal.
- [By Lisa Levin] Related TCK 7 Stocks Moving In Monday's After-Hours Session Stocks Hitting 52-Week Lows Teck Resources (TCK) Donald R. Lindsay on Q4 2015 Results – Earnings Call Transcript (Seeking Alpha) Related NRG Mid-Day Market Update: Crude Oil Jumps 11%; Nu Skin Shares Tumble Following Weak Results Mid-Morning Market Update: Markets Open Higher; Groupon Tops Q4 Expectations Weekly Leading Sectors Report (Seeking Alpha)
Toward the end of trading Friday, the Dow traded up 1.42 percent to 15,882.65 while the NASDAQ climbed 0.95 percent to 4,307.41. The S&P also rose, gaining 1.29 percent to 1,852.75.