Deutsche Bank’s Brett Levy argues that even if Chipotle Mexican Grill (CMG) can return to the kind of growth it had before its health scandals, competitive and operational pressures will keep its valuation lower than at its peak. He explains why:
Over the last year, Chipotle has seen its operations and share price move from high-teen SSS gains and over $750, respectively, to SSS declining as much as -40%, a ~$26 million loss in 1Q16 and its share dipping to ~$400. The story has had uncertainty in recent quarters, but neither Bulls nor Bears appear convinced on sales trends or the share price’s next move….We continue to believe competitive, operational and valuation concerns persist and remain “Bearish” with a Sell rating, newly lowered EPS estimates and $340 PT.
Competitive: It may not be smooth sailing to get guests back. Chipotles AUVs topped ~$2.5 million last year, but have since experienced a dramatic sales decline (an estimated annualized ~$350k per unit loss), creating an opportunity for food service operators to battle for these lost share dollars. Some of these customers may be lost for good, but in the battles to regain other guests, we believe additional issues may weigh on Chipotles prospects (even as these returning guests reintroduce Chipotle into their rotation, we believe they will share visits with other acceptable options).
Top Building Product Companies To Invest In 2016: Schnitzer Steel Industries, Inc.(SCHN)
Schnitzer Steel Industries, Inc. recycles ferrous and nonferrous scrap metals; and manufactures finished steel products worldwide. It operates through two segments, Auto and Metals Recycling (AMR) and Steel Manufacturing Business (SMB). The AMR segment buys, collects, processes, recycles, sells, and brokers scrap metals, as well as processes mixed and large pieces of scrap metal into smaller pieces by crushing, torching, shearing, shredding, and sorting. This segment offers ferrous scrap metal, a feedstock used in the production of finished steel products; and nonferrous products, including aluminum, copper, stainless steel, nickel, brass, titanium, lead, high temperature alloys, and joint products. It sells ferrous and nonferrous recycled metal products to steel mills, foundries, and smelters. This segment also procures salvaged vehicles and sells serviceable used auto parts from these vehicles through its 55 self-service aut o parts stores in the United States and Western Canada, as well as sells auto bodies and parts containing ferrous and nonferrous materials, such as engines, transmissions, and alternators to wholesalers. The SMB segment produces various finished steel products using recycled metal and other raw materials. It offers semi-finished goods, which include billets; and finished goods consisting of rebar, coiled rebar, wire rods, merchant bars, and other specialty products. This segment serves steel service centers, construction industry subcontractors, steel fabricators, wire drawers, and farm and wood products suppliers. Schnitzer Steel Industries, Inc. was founded in 1906 and is headquartered in Portland, Oregon.
- [By Monica Gerson]
Darden Restaurants, Inc. (NYSE: DRI) is estimated to report its quarterly earnings at $1.08 per share on revenue of $1.81 billion. ConAgra Foods Inc (NYSE: CAG) is expected to report its quarterly earnings at $0.52 per share on revenue of $2.89 billion. Paychex, Inc. (NASDAQ: PAYX) is projected to report its quarterly earnings at $0.49 per share on revenue of $751.52 million. Micron Technology, Inc. (NASDAQ: MU) is expected to post a quarterly loss at $0.09 per share on revenue of $2.95 billion. McCormick & Company, Incorporated (NYSE: MKC) is estimated to report its quarterly earnings at $0.74 per share on revenue of $1.06 billion. Constellation Brands, Inc. (NYSE: STZ) is expected to report its quarterly earnings at $1.51 per share. Schnitzer Steel Industries, Inc. (NASDAQ: SCHN) is estimated to report its quarterly earnings at $0.18 per share on revenue of $356.41 million. Franklin Covey Co. (NYSE: FC) is expected to post its quarterly earnings at $0.08 per share on revenue of $49.89 million. Lindsay Corporation (NYSE: LNN) is projected to report its quarterly earnings at $0.99 per share on revenue of $148.43 million.
Posted-In: Earnings scheduleEarnings News Pre-Market Outlook Markets
Top Building Product Companies To Invest In 2016: Covanta Holding Corporation(CVA)
Covanta Holding Corporation, incorporated on April 16, 1992, is a holding company. The Company, through its subsidiaries, owns and operates infrastructure for the conversion of waste to energy, as well as other waste disposal and renewable energy production businesses. The Company operates through North America segment, which consists of waste and energy services operations located primarily in the United States and Canada. The energy-from-waste (EfW) serves over two markets as both a sustainable waste management solution and as a source of clean energy.
The Company processes approximately 20 million tons of solid waste annually. The Company operates and/or have ownership positions in over 45 EfW facilities, which are primarily located in North America, and over 10 additional energy generation facilities, including other renewable energy production facilities in North America (wood biomass and hydroelectric). In total, these assets produce approximately 10 mil lion megawatt hours (MWh) of baseload electricity annually. It also operates waste management infrastructure, including over 20 waste transfer stations, 10 environmental services facilities, four landfills (primarily for ash disposal) and one metals processing facility. The Company is constructing an EfW facility in Dublin, Ireland. The Company holds equity interests in EfW facilities in China and Italy.
The Company’s energy-from-waste facilities produce energy through the combustion of non-hazardous municipal solid waste (MSW) in power plants. The Company operates EfW projects in approximately 20 states and over two Canadian provinces. Based on the applicable contract structure at a project, the EfW projects can generally be divided into over three categories, such as tip fee projects; service fee projects that it own, and service fee projects that it do not own but operate on behalf of a municipal owner. The tip fee projects include approximately 20 facilities ; service fee (owned) projects include over five facilities,! and service fee (operated) projects include approximately 20 facilities. Its energy-from-waste assets include tip fee structures, such as Hempstead, Lake County, Camden and Bristol; service fee (owned) structures, such as Babylon, Southeast Connecticut and Marion County, and service fee (operated) structures, such as Lee County, York County, Burnaby, MacArthur and Pasco County.
- [By Ian Wyatt, Publisher & Chief Investment Strategist, Wyatt Investment Research]
Both of these stocks are overlooked, undervalued, and cash flow machines. The companies are Ascent Capital Group (ASCMA) and Covanta Holdings (CVA).
5 Best Healthcare Equipment Stocks To Own Right Now: LyondellBasell Industries NV(LYB)
LyondellBasell Industries N.V. manufacturers and sells chemicals and polymers, refines crude oil, produces gasoline blending components, and develops and licenses technologies for production of polymers. The company?s Olefins and Polyolefins segment offers olefins, including ethylene, propylene, and butadiene; aromatics, such as benzene and toluene; polyolefins, which comprise polypropylene (PP), high-density polyethylene, low-density polyethylene, and linear low-density polyethylene; specialty polyolefins, including catalloy process resins, PP compounds, and polybutene-1 resins; and ethylene derivatives, which comprise ethanol. Its Intermediates and Derivatives segment provides propylene oxide (PO); PO co-products, including styrene monomers and TBA derivative isobutylene; PO derivatives, such as propylene glycol, propylene glycol ethers, and butanediol; acetyls, such as methanol, acetic acid, and vinyl acetate monomers; ethylene derivatives, which comprise ethylene oxide , ethylene glycol, and ethylene glycol ethers; and flavor and fragrance chemicals. The company?s Refining and Oxyfuels segment offers gasoline and components, ultra low sulfur diesel, jet fuel, and lube oils; diesel, feedstock, fuel oil, gasoline, and bitumen; and gasoline blending components, including methyl tertiary butyl ether, ethyl tertiary butyl ether, and alkylate. Its Technology segment develops and licenses polyolefin and other process technologies. This segment also develops, manufactures, and sells polyolefin catalysts, as well as provides technology services, which comprise safety reviews, training and start-up assistance, engineering services for process and product improvements, and manufacturing troubleshooting. LyondellBasell Industries N.V. has operations in the Americas, Europe, Asia, and internationally. The company was founded in 2005 and is based in Rotterdam, Netherlands. LyondellBasell Industries N.V. is a subsidiary of Prochemie GmbH.
- [By Chad Tracy]
TransCanada is not the only company that stands to profit from the possible Keystone XL approval. Refiners such as Valero and LyondellBasell Industries (NYSE: LYB), as well as construction companies Deere & Co. (NYSE: DE) and Quanta Services (NYSE: PWR) all stand to gain if Keystone XL gets the green light.
- [By Chad Tracy]
In a classic contrarian move, he purchased more shares of troubled plastics-maker LyondellBasell Industries (NYSE: LYB), even as the company was sliding toward bankruptcy.
Top Building Product Companies To Invest In 2016: Navistar International Corporation(NAV)
Navistar International Corporation manufactures and sells commercial and military trucks, diesel engines, and school and commercial buses; and provides service parts for trucks and diesel engines worldwide. It operates through four segments: Truck, Parts, Global Operations, and Financial Services. The company manufactures and distributes Class 4 through 8 trucks and buses in the common carrier, private carrier, government, leasing, construction, energy/petroleum, military vehicle, and student and commercial transportation markets under the International and IC brands; and designs, engineers, and produces sheet metal components, including truck cabs and engines. It also provides customers with proprietary products needed to support the International commercial and military truck, IC bus, and Maxxforce engine lines, as well as other product lines; and a selection of other standard truck, trailer, and engine aftermarket parts. In addition, the company designs and manufactures mid-range diesel engines, as well as provides customers with additional engine offerings in the agriculture, marine, and light truck markets; sells engines to original equipment manufacturers (OEM) for various on-and-off-road applications; and offers contract manufacturing services under the MWM brand to OEMs for the assembly of their engines. Further, it provides retail, wholesale, and lease financing of products sold by the Truck and Parts segments and their dealers, as well as financing for wholesale accounts and retail accounts receivable. The company markets its commercial products through an independent dealer network, as well as through distribution and service network retail outlets; and its reconditioned used trucks to owner-operators and fleet buyers through its network of used truck dealers. As of October 31, 2015, it had approximately 745 outlets in the United States and Canada, and 91 outlets in Mexico. The company was founded in 1902 and is headquartered in Lisle, Illinois! .
- [By Roberto Pedone]
Another industrial player that insiders are snapping up a large amount of stock in here is Navistar International (NAV), which is a manufacturer of commercial and military trucks buses, diesel engines, and recreational vehicles under the Monaco RV family of brands, as well as a provider of service parts for all makes of trucks and trailers. Insiders are buying this stock into big time strength, since shares are up 67% so far in 2013.
Navistar International has a market cap of $2.9 billion and an enterprise value of $6.4 billion. This stock trades at a premium valuation, with a forward price-to-earnings of 50.50. Its estimated growth rate for this year is 7.2%, and for next year it’s pegged at 107.1%. This is not a cash-rich company, since the total cash position on its balance sheet is $1.09 billion and its total debt is $4.72 billion.
A director just bought 415,101 shares, or about $14.12 million worth of stock, at $33.90 per share.
From a technical perspective, NAV is currently trending above both its 50-day and 200-day moving averages, which is bullish. This stock recently started to break out above its sideways consolidation pattern after shares cleared $35 to $35.90 a share. That move is now pushing shares of NAV within range of triggering another near-term breakout trade.
If you’re in the bull camp on NAV, then look for long-biased trades as long as this stock is trending above $35 to $34, and then once it breaks out above some near-term overhead resistance levels at $37 to its 52-week high at $38.81 a share with high volume. Look for a sustained move or close above those levels with volume that hits near or above its three-month average action of 1.21 million shares. If that breakout triggers soon, then NAV will set up to enter new 52-week high territory, which is bullish technical price action. Some possible upside targets off that move are $43 to $48 a share.
- [By Lisa Levin]
Benzinga's newsdesk monitors options activity to notice unusual patterns. These large volume (and often out of the money) trades were initially published intraday in Benzinga Professional . These trades were placed during Monday's regular session.
Navistar International Corp (NYSE: NAV) Jun16 10.0 Puts Sweep: 902 @ ASK $0.35: 15k traded vs 1749 OI: Earnings Today Before Open $12.22 Ref ConocoPhillips (NYSE: COP) Fri 6/10 44.5 Puts (Wkly): 2000 @ ASK $0.43: 4051 traded vs 80 OI: $44.87 Ref SeaWorld Entertainment Inc (NYSE: SEAS) Sep16 17.0 Puts Sweep: 683 @ ASK $1.40: 2749 traded vs 313 OI: $16.52 Ref
Posted-In: put optionsNews Options Markets
Top Building Product Companies To Invest In 2016: Canon, Inc.(CAJ)
Canon Inc. (Canon), incorporated on August 10, 1937, is a manufacturer of office multifunction devices (MFDs), plain paper copying machines, laser printers, inkjet printers, cameras and lithography equipment. Canon sells its products principally under the Canon brand name and through sales subsidiaries. The Company earns revenues primarily from the manufacture and sale of these products domestically and internationally. Canon has manufacturing subsidiaries in a variety of countries, including the United States, Germany, France, the Netherlands, Taiwan, China, Malaysia, Thailand, Vietnam and the Philippines. Canon operates its business in three segments: the Office Business Unit, the Imaging System Business Unit, and the Industry and Others Business Unit.
Office Business Unit
Canon manufactures, markets and services a range of MFDs, printers, copying machines for personal and office use and production print products for print professionals. The Off ice Business Unit includes MFDs, laser multifunction printers (MFPs), laser printers, digital production printing systems, feed printers, wide-format printers and document solutions. The Company also delivers added value to customers through software, services and solutions. Its offerings cover a range of markets from Small Office Home Office (SOHO), and Small and Midsize Business (SMB) to large enterprises and professional graphic arts. Canon has launched its A4-size color device imageRUNNER ADVANCE C350iF/C250iF. Canon has also launched imageRUNNER 2202/2002, which is a low-end A3-size monochrome device tailored to the emerging market.
In software, services and solutions, Canon’s application development platform, the Multifunctional Embedded Application Platform (MEAP), allows the creation of customized applications for Canon MFDs. Canon is engaged in reinforcing its solutions capability through offerings, such as imageWARE software suite, business process aut omation software Enterprise Imaging Platform (EIP) and Canon! MDS, which is a device management solution. Canons consolidated net sales, for the years ended December 31, 2014, were 55.8% for the Office Business Unit.
The Company competes with Xerox Corporation/Fuji Xerox Co., Ltd.; Ricoh Company, Ltd.; Konica Minolta Inc.; Hewlett-Packard Company; Samsung Electronics Co., Ltd., Toshiba TEC Corporation, Sharp Corporation and Lexmark International, Inc.
Imaging System Business Unit
Canon manufactures and markets digital cameras and digital video camcorders, as well as lenses and various related accessories. The Imaging System Business Unit includes interchangeable lens digital cameras, digital compact cameras, digital camcorders, digital cinema cameras, interchangeable lenses, inkjet printers, large-format inkjet printers, commercial photo printers, image scanners, multimedia projectors, broadcast equipment and calculators.
The Company has launched two new digital single-lens reflex camera (SLR) cameras. The Canon EOS 7D Mark II is designed to meet the demands of photographers and videographers who want a camera that can provide a range of artistic opportunities. It shoots up to 10 frames per second and has a 65-point all cross-type AF system. The number of available autofocus (AF) points, and whether single line or cross-type, varies depending on the lens. Canon also launched seven new lens products for digital SLR. The interchangeable lens lineup exceeds 90 products, including Cinema Lenses (EF-Mount).
The Company has introduced fourteen new models to the compact digital camera market across the world. Canon offers a range of products to meet needs based on its core technology Full-photolithography Inkjet Nozzle Engineering (FINE). For home use, Canon offers printer solutions as PIXMA Cloud Link and PIXMA Printing to tighten the connection with cloud computing, smartphone and tablet personal computers (PC). It also offers My Image Garden , enabling a range of photo-print, an Intelligent Touch Syst! em and XL! ink tank & ink cartridge.
Canon launched the brand MAXIFY in the business inkjet printer segment. In the professional printing market, the Company offers three professional photo inkjet printers: the PIXMA PRO-1 with a 12 LUCIA ink system of pigment-based inks, PIXMA PRO-10 with a 10 LUCIA ink system, and the PIXMA PRO-100 with eight dye inks to produce colorful and vivid prints. Canons large-format inkjet printers are based on FINE head technology and employ its image processor, L-COA, developed for LUCIA pigment inks. Canons lineup also includes CanoScan LiDE, the flatbed scanners which use Contact Image Sensor (CIS), and a scanner with Charge-Coupled Devices (CCD) for high resolution. Canons consolidated net sales, for the years ended December 31, 2014, were 36.0% for the Imaging System Business Unit.
The Company competes with Sony Corporation, Samsung Electronics Co., Ltd., Nikon Corporation; Panasonic Corporation; JVC Kenwood Corporat ion, Hewlett-Packard Company and Seiko Epson Corporation.
Industry and Others Business Unit
The Company’s Industry and Others Business Unit segment includes semiconductor lithography equipment, Flat panel display (FPD) lithography equipment, digital radiography systems, ophthalmic equipment, vacuum thin-film deposition equipment, organic light emitting diode (OLED) panel manufacturing equipment, die bonders, micromotors, network cameras, handy terminals and document scanners. Canons consolidated net sales for the years ended December 31, 2014, were 10.7% for the Industry and Others Business Unit.
The Company competes with Nikon Corporation and ASML Holding N.V.
- [By Dan Carroll]
Nikon’s story is similar to what’s plaguing its Japanese rival, Canon (NYSE: CAJ ) . Canon’s stock has nosedived by 20% year to date, but the stock’s recovered nearly 3% over the past month. Don’t let appearances fool you: The company slashed its full-year sales and profit forecasts back in July, as the worldwide camera market has slumped, and as smartphones continue to take over this aging niche. Canon’s route back to respectability looks like a treacherous climb.
- [By Paul R. La Monica]
Miscellaneous shorts. Lamensdorf is also betting against Japanese printer and camera giant Canon (CAJ) since he believes the company still hasn’t figured out a way to compete with smartphones.
Top Building Product Companies To Invest In 2016: Becton, Dickinson and Company(BDX)
Becton, Dickinson and Company develops, manufactures, and sells medical devices, instrument systems, and reagents worldwide. The companys BD Medical segment offers syringes and pen needles for diabetes; needles, syringes, and intravenous catheters for medication delivery; prefilled IV flush syringes; regional anesthesia needles and trays; sharps disposal containers; closed-system transfer devices; skin antiseptic products; surgical and laproscopic instrumentations; generic prefilled injectables; intravenous medication safety and infusion therapy delivery, and automated medication dispensing and supply management systems; prefillable drug delivery systems; respiratory ventilation, and diagnostics equipment and consumables; and consumables for patient monitoring and anesthesia delivery. Its Life Sciences segment provides integrated systems for specimen collection; safety-engineered blood collection, automated blood culturing a nd tuberculosis culturing, and microorganism identification and drug susceptibility systems; molecular testing systems for infectious diseases and womens health; liquid-based cytology systems for cervical cancer screening; rapid diagnostic assays; microbiology laboratory automation, and plated media products; fluorescence-activated cell sorters and analyzers; monoclonal antibodies and kits for performing cell analysis; reagent systems for life science research; molecular indexing and next-generation sequencing sample preparation for genomics research; clinical oncology, immunological, and transplantation diagnostic/monitoring reagents and analyzers; and cell culture media supplements for biopharmaceutical manufacturing. The company markets its products through independent distribution channels and sales representatives to healthcare institutions, life science researchers, clinical laboratories, pharmaceutical industry, and general public. Becton, Dickinson and Company was founded in 1897 and is headquartered in Franklin Lakes, New ! Jersey.
- [By Ben Levisohn]
Becton Dickinson (BDX) has gained 1.2% to $101.97 this morning afterPiper Jaffrayraised the stock to Overweight from Neutral. AnalystsWilliam Quirk andDavid Clairexplain why they’re optimistic about the medical technology company:
Observations from multiple diagnostic conferences all suggest significant interest inmicrobiology investment. This interest spans track systems (Kiestra), new identificationtechnologies (Maldi/BioTyper) and Molecular (gram +/- assays). When consideringAST (antimicrobial susceptibility testing) recall from Siemens, we believe BD’smicrobiology business is poised to accelerate its performance over the next several years.Combined with a delayed JNJ/Ypsomed pen needle launch and incremental Europeansafety adoption, we believe numbers for BD will continue to climb…
They also raised their price target to $117 from $91.
While Becton has gained today,Johnson & Johnson(JNJ) has dropped 0.6% to $88.50,Medtronic(MDT) has fallen 1%to $53.43,Boston Scientific(BSX) has declined 0.9% to $11.79 and Edwards Lifesciences (EW) is off 1.2% at $70.90.