Citigroup’s Robert Morris and David Zutter explain why they upgraded Encana (ECA) to Buy from Neutral:
Deep Resource Base To Drive Strong Liquids Growth
We project EnCanas total organic production will increase at a ~12% CAGR for 2016 through 2021 with organic oil/liquid volumes increasing at a ~20% CAGR. This growth will be largely driven by the Permian and Montney with Encana’s ‘Top Four’ output (~70% of current total) doubling while the total production mix transitions to ~48% from ~35% liquids in 2021, absent any major non-core asset sales. This growth outlook assumes Encana ramps to 10 rigs in the Permian by 2018 and drills ~2,000 premium return locations in its ‘Top Four’ plays. However, this outlook is above EnCanas recent top-level indication that it will drill ~1,500 premium locations and post a ~10% CAGR for total production through 2021 under its Base Case price deck of flat $55/$3.00.
Hot Shipping Companies To Watch For 2017: Cott Corporation(COT)
Cott Corporation, incorporated on December 31, 2006, along with its subsidiaries, is engaged in the production of beverages on behalf of retailers, brand owners and distributors. The Company operates through four segments: DSS; Cott North America; Cott United Kingdom (Cott U.K.), and All Other, which includes its Mexico segment, Royal Crown International (RCI) segment and other miscellaneous expenses.
The Company is engaged in home and office bottled water and office coffee services distribution in the United States. The Company has approximately 60 beverage manufacturing, production, distribution and fruit processing facilities, including over 50 in North America, which include approximately 30 combined production and distribution facilities, over eight in the United Kingdom and approximately one in Mexico, and over one manufacturing facility in Columbus, Georgia that supplies its manufacturing plants. The total square footage of its beverage manufacturing, p roduction, distribution and fruit processing facilities is approximately 6.3 million square feet in North America, over 1.2 million square feet in the United Kingdom and approximately 0.3 million square feet in Mexico.
The Company’s brands in North America and the United Kingdom include Cott and Red Rain. In the United States, its brands include Stars & Stripes, Vess, Vintage, So Clear, Shanstar, Harvest Classic, Chadwick Bay, Exact, Alhambra, Belmont Springs, Deep Rock, Hinckley Springs, Sparkletts, Crystal Springs, Kentwood Springs, Mount Olympus, Standard Coffee and Javarama. In the United Kingdom, its brands include Emerge, Red Rooster, MacB, Carters, Calypso, Mr. Freeze, Jubbly, Suso, Cafe Nueva and Ben Shaws. The Company also operates under the brand names Stars & Stripes in Mexico and RC mark in various formats in 120 countries and territories outside of North America.
The DSS segment provides direct-to-consumer products, suc h as bottled water, coffee, brewed tea, water dispensers, co! ffee and tea brewers, and filtration equipment. The DSS segment accounted for 1.4% of its total net revenue, as of January 2, 2016.
The Company’s traditional business consists of its Cott North America, Cott U.K. and All Other segments. Its traditional business produces products, including carbonated soft drinks (CSDs), shelf stable juice and juice-based products, clear, still and sparkling flavored waters, energy drinks and shots, sports drinks, new age beverages, ready-to-drink teas, liquid enhancers, freezables, ready-to-drink alcoholic beverages, hot chocolate, coffee, malt drinks, creamers/whiteners, cereals and beverage concentrates, directly or through third-party manufacturers. Its traditional business accounted for 18.9% of the Company’s total revenue, as of January 2, 2016.
The Company competes with Coca-Cola, Pepsi, Nestle Waters North America, Dr. Pepper Snapple, Welch’s, Ocean Spray, Nestle, and Mott’s.
- [By Dan Moskowitz]
Cott (NYSE: COT ) produces and sells over 200 different types of beverages in over 50 countries, and it implements a highly effective strategy. Cott is what is known as a Fast Follower, which makes it unique to other beverage companies.
Hot Shipping Companies To Watch For 2017: Astro-Med, Inc.(ALOT)
AstroNova, Inc., formerly Astro-Med, Inc., incorporated on January 9, 1969, designs, develops, manufactures and distributes a range of specialty printers, and data acquisition and analysis systems. The Company operates through two segments: QuickLabel and Test & Measurement (T&M). The Company sells specialty printing systems, and test and measurement systems under the brand names, including QuickLabel. The Company offers both hardware and software, which incorporate technologies in order to acquire, store, analyze and present data in multiple formats. The Company serves markets, such as aerospace, apparel, automotive, avionics, chemicals, computer peripherals, communications, distribution, food and beverage, general manufacturing, packaging and transportation. The Company’s products are distributed through its sales teams and authorized dealers in the United States. The Company sells to customers outside of the United States through its branch offices in Canada, Europe and Asia, as well as with independent dealers and representatives.
The Company’s QuickLabel segment offers product identification and label printer hardware, software, servicing contracts and consumable products. The products sold under the QuickLabel brand include digital color label printers and specialty original equipment manufacturer (OEM) printing systems, as well as a line of consumables, including labels, tags, inks, toner and thermal transfer ribbon. In addition, QuickLabel sells special software used to design labels and other identification marks for a range of applications especially in the field of packaging. QuickLabel provides training and support through trained service technicians. The products sold under the QuickLabel brand are used in industrial and commercial product packaging and automatic identification applications to digitally print custom labels and other visual identification marks. In the aerospace market, the Com pany provides airborne printers.
In the color l! abel market, QuickLabel offers a range of entry-level, mid-range and high-performance digital label printers. QuickLabel products are sold to manufacturers, processors and retailers labeling products on a short-run basis. The QuickLabel models include the Kiaro! family of high-speed inkjet color label printers, and the QLS-4100 Xe color thermal transfer label printer. QuickLabel also sells and supports its Pronto! family of barcode printers, which utilize single color-thermal transfer label printing technology, as well as a range of custom designed OEM printers.
Test & Measurement
The Company’s T&M segment offers a suite of products and services that acquire and record visual and electronic signal data from local and networked sensors, as well as wired and wireless networks. The recorded data is processed and analyzed and then stored and presented in various visual output formats. The Company supplies a range of products and services that include ha rdware, software and consumables to customers. The segment also includes a line of aerospace printers that are used to print hard copies of data. Its products include the Daxus portable data acquisition system, TMX high-speed data acquisition system, Dash 8HF-HS data recorders, Everest telemetry recorders, ToughWriter, Miltope-brand and RITEC-brand airborne printers, and ToughSwitch ruggedized Ethernet switches.
The Company’s airborne printers are used in the flight deck and in the cabin of military, commercial and business aircraft to print hard copies of data required for the operation of aircraft, including navigation maps, arrival and departure procedures, flight itineraries, weather maps, performance data, passenger data, and various air traffic control data. ToughSwitch Ethernet switches are used in military aircraft and military vehicles to connect multiple computers or Ethernet devices. The airborne printers and Ethernet switches are ruggedized to comply with rigorous military and commercial flightworthiness stan! dards for! operation under extreme environmental conditions. The Company furnishes ToughWriter airborne printers for numerous aircraft made by Airbus, Boeing, Embraer, Bombardier, Lockheed, Gulfstream and others.
The Company’s family of portable data recorders is used in research and development (R&D) and maintenance applications in aerospace and defense, energy discovery and production operations, rapid rail, automotive, and a range of other transportation and industrial applications. The TMX data acquisition system is designed for data capture of long-term testing where the ability to monitor high channel counts and view a range of input signals, including time-stamped and synchronized video capture data and audio notation is important. Everest telemetry recorders are used in the aerospace industry to monitor and track space vehicles, aircraft, missiles and other systems in flight.
- [By Monica Gerson]
Astro-Med, Inc. (NASDAQ: ALOT) is projected to post its quarterly earnings at $0.21 per share on revenue of $25.50 million.
Bellatrix Exploration Ltd (NYSE: BXE) is expected to post a quarterly loss at $0.10 per share on revenue of $71.27 million.
Best Managed Healthcare Stocks To Buy For 2017: Dillard's, Inc.(DDS)
Dillard’s, Inc., incorporated on January 13, 1964, is a retailer of fashion apparel, cosmetics and home furnishing. The Company operates approximately 300 Dillard’s stores, including over 20 clearance centers, and an Internet store offering a range of merchandise, including fashion apparel for women, men and children, accessories, cosmetics, home furnishings and other consumer goods. The Company’s segments include the Retail operations segment and the Construction segment. The Retail operations segment includes the operation of the Company’s retail department stores. The Construction segment includes the operations of CDI Contractors, LLC (CDI), a general contracting construction company. CDI’s business includes constructing and remodeling stores for the Company.
The Company operates retail department stores in approximately 30 states, primarily in the southwest, southeast and midwest regions of the United States. The Company’s stores are primarily located in suburban shopping malls and open-air centers. It also allows customers to purchase its merchandise online at its Website, www.dillards.com, which features online gift registries and a range of other services. The Company’s merchandise selections include its lines of brand merchandise, such as Antonio Melani, Gianni Bini, GB, Roundtree & Yorke, and Daniel Cremieux.
- [By Johanna Bennett]
Dillards (DDS) fell more than 5% during after-hours trading, joining the list of retailers being done in by disappointing fiscal first quarter financial results.
At $2.17 a share, first quarter earnings fell more than expected, coming in 40 cents below the Capital IQ consensus of $2.57. Net revenue (which includes Dillards construction business) fell 4.5% to $1.5 billion, just missing the $1.55 billion consensus.
Merchandise sales declined 5% to just below $1.45 billion with same-store sales falling a like amount. Dillards operates 272 Dillard’s locations and 24 clearance centers spanning 29 states.
Heres what CEO William T. Dillard, II had to say:
Our disappointing sales pressured our gross margin and net income performance, although inventory was relatively flat at quarter end. While we controlled expenses, sales leverage was difficult to achieve. We continued to return value to shareholders by purchasing $58.4 million of our Class A Common Stock during the quarter.
Retail sector earnings have been big newsthis week, with a several large chains posting gloomy updates. The biggest bust came whenMacys(M) disappointed yesterday and slashed its full-year outlook, sending the stock falling 15% and yanking down the entire retail sector.Nordstrom (JWN) could rival that drop. The shares fell more than 16% after today’s closing bell after the company missed estimates and cut its full-year sales and profit outlook.
The rout in retail stocks has fueledworries about consumer spending and even the broader economy, which were outlined in detail today by my colleague Randy Forsyth in his column, Up and Down Wall Street.
As of todays closing bell, Dillard’s share price has declined nearly 51% since the beginning of the year. The stock dropped 5.6% in after-hours trading to $57.20.
- [By Ben Levisohn]
While all retailers with an e-commerce business are exposed to these secular changes to some degree, those with a higher e-commerce penetration are more exposed, sooner. On the brick & mortar operations side, those retailers with the lowest wage rates are likely to be most impact by the essentially industry-wide wage increases brought on by Wal-Mart Stores (WMT); these retailers may see more incremental growth in their SG&A dollars from increased wage pressure. While Macy’s (M) appears to be in the worst challenged position, earlier this year the company announced initiatives to decrease their cost base by $400 mn, along with their longer term goal of reducing expenses by $500 mn by ’18. Even Nordstrom (JWN) appears to have begun to react with a major layoff recently in their technology team. Dillard’s (DDS) is likely least impacted, as it has a low e-commerce penetration as well as fairly competitive average wages.