Skechers and Heelys exchange words on takeover offer originally appeared on BloggingStocks on Thu, 21 Aug 2008 14:49:00 EST. Please see our terms for use of feeds.

Skechers makes a bid for Heelys originally appeared on BloggingStocks on Thu, 14 Aug 2008 09:26:00 EST. Please see our terms for use of feeds.

Nordstrom (NYSE: JWN) is expected to report Q2 EPS today after the market close. JWN August 30 straddle is priced at $2.90, September 30 is at $4.40. JWN September option implied volatility of 58 is above its 26-week average of 52 according to Track Data, suggesting larger price movement.

Red Robin Gourmet (NASDAQ: RRGB) is scheduled to report Q2 EPS today. RRGB August 30 straddle is priced at $2.60, September is at $5.15. RRGB September option implied volatility of 64 is above its 26-week average of 52 according to Track Data, suggesting larger price movement.

Heelys (NASDAQ: HLYS) is recently up 68 cents to $5.55 in pre-open trading. Skechers (NYSE: SKX) made an acquisition proposal to acquire HLYS for $5.25 per share ($142 million) in cash. HLYS, wheel-in-the-heel footwear marketer, closed at closed at $4.87. HLYS traded at a record high of $40.09 in February 2007. HLYS over all option implied volatility of 77 is near its 26-week average according to Track Data, suggesting non-directional price movement.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

Option Update: Nordstrom and Red Robin volatility up into EPS originally appeared on BloggingStocks on Thu, 14 Aug 2008 09:11:00 EST. Please see our terms for use of feeds.

With a turn of the calendar page, we drift into the middle portion of the current quarter, but the earnings season rolls on. Among the many companies scheduled to report quarterly results this coming week are Time Warner Inc. (NYSE: TWX), Cisco Systems Inc. (NASDAQ: CSCO), News Corp. (NYSE: NWS), and Whole Foods Market International (NASDAQ: WFMI). Let's take a look at which companies Wall Street analysts are expecting to be among the top earnings gainers and decliners this week.

Analysts surveyed by Thomson Financial expect the following to report strong earnings growth when compared to the same period of the previous year.

• DRS Technologies Inc. (NYSE: DRS): $0.85 EPS (+95.3%) on revenue of $823.8 million (+12.0%)
• Integrys Energy Group Inc. (NYSE: TEG): $0.40 EPS (+70.0%) on revenue of $2.6 billion (+9.7%)
• Cimarex Energy Co. (NYSE: XEC): $2.53 EPS (+64.4%) on revenue of $599.9 million (+75.4%)
• Forest Oil Corp. (NYSE: FST): $1.51 EPS (+55.6%) on revenue of $456.1 million (+79.1%)
• Devon Energy Corp. (NYSE: DVN): $3.28 EPS (+48.5%) on revenue of $4.1 billion (+38.5%)
• CMS Energy Corp. (NYSE: CMS): $0.13 EPS (+46.2%) on revenue of $1.4 billion (+6.7%)
• Transocean Inc. (NYSE: RIG): $3.23 EPS (+43.0%) on revenue of $3.1 billion (+112.9%)
• Sara Lee Corp. (NYSE: SLE): $0.26 EPS (+38.5%) on revenue of $3.5 billion (+8.9%)
• Williams Companies Inc. (NYSE: WMB): $0.69 EPS (+37.7%) on revenue of $3.4 billion (+20.0%)
• Harris Corp. (NYSE: HRS): $0.99 EPS (+28.3%) on revenue of $1.4 billion (+18.0%)

Continue reading The week in preview: Expectations remain high for energy and oil

The week in preview: Expectations remain high for energy and oil originally appeared on BloggingStocks on Sun, 03 Aug 2008 12:30:00 EST. Please see our terms for use of feeds.

What's interesting is that the reports about Crocs' safety issues have all come from the media, not the company's SEC filings. Back in 2006, ABC reported that Crocs can pose a danger on escalators. Some hospitals have even banned the shoes citing safety concerns.

But Crocs' latest 10-K is devoid of any references to the concerns about the safety of the shoes.

A similarly struggling fad shoe company, Heelys (NASDAQ: HLYS), has also dealt with issues surrounding the safety of its footwear. From the risk factors section of the company's latest 10-K:

Continue reading Should Crocs disclose safety issues in its 10-K?

Should Crocs disclose safety issues in its 10-K? originally appeared on BloggingStocks on Tue, 22 Apr 2008 16:10:00 EST. Please see our terms for use of feeds.

Someone had to pay for the extremely disappointing downturn in the stock of Heelys Inc. (NASDAQ: HLYS), the children's shoe company that builds wheels into its footwear. The company's CEO was pushed out on Friday.

The stock has fallen from a 52-week high of $40.09. The shares now change hands just above $6.

After a huge run in revenue that moved from $21 million in 2004 to $188 million in 2006, more recently sales have fallen off to $50 million after hitting $75 million in the June quarter.

Like other specialty shoe companies, including Crocs Inc. (NASDAQ: CROX), Heelys has not been able to follow its first big hit with other items.

Changing CEOs is not going to alter that.

Douglas A. McIntyre is an editor at 247wallst.com.

Heeleys CEO checks out originally appeared on BloggingStocks on Sat, 02 Feb 2008 15:40:00 EST. Please see our terms for use of feeds.

The resignation of a board member at once high-flying skate-shoe manufacturer Heelys (NASDAQ: HLYS) could be a harbinger of a managerial shake-up at the company.

On December 21st, Heelys filed an 8-K announcing that on December 17th, board member James Kindley had resigned in protest to a board resolution "relating to Michael G. Staffaroni's, the Company's President and Chief Executive Officer, handling of certain operational matters".

In a letter to Staffaroni filed with the 8-K, Kindley explained his resignation:

As you know, I strongly support your vision for the company and your strategy for realizing it. Regrettably, a majority of the directors voted at the November meeting for an ultimatum expressing dissatisfaction with your performance, an action I openly opposed (that is not reflected in the minutes) and one that I feel signals an unjustified lack of confidence in you and your strategy. I am unable and unwilling to support the majority's alternatives and directives.

Given that a majority of the board has expressed dissatisfaction with the CEO -- and saw fit to hold a vote to formalize that disappointment -- his days with the company could be numbered.

Heelys has had a rough time since its IPO. Its stock has fallen from a high of $40.09 to its current price under $6.25, which was accompanied by a slew of shareholder class action lawsuits. A change at the top could be a short-term catalyst for a recovery in the share price and, with the board's dissatisfaction with the CEO now plastered over an SEC filing, that could come soon.

Management shake-up at Heelys on the way? originally appeared on BloggingStocks on Wed, 26 Dec 2007 12:30:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• CIBC downgraded Heelys (NASDAQ: HLYS) to Underperformer from Sector Performer. The analyst has little confidence sales will recover following the recent drop.
  
• CIBC also downgraded Citigroup (NYSE: C) to Sector Underperformer from Sector Performer, as they believe the company may have to cut its dividend, raise cash or sell assets in order to raise $30B over the near-term; the firm believes such a move would pressure shares significantly.
  
• Merriman downgraded shares of Alvarion (NASDAQ: ALVR) to Neutral from Buy after the in-line results as they now believe increased competition will pressure gross margins and minimize operating leverage in FY08.
  
• Merrill downgraded shares of UBS AG (NYSE: UBS) to Neutral from Buy to reflect the potential of further write downs.
  
• Banc of America lowered its rating on Alcatel-Lucent (NYSE: ALU) to Neutral from Buy to reflect poor execution of the company's turnaround strategy.

• Goldman removed Vimpelcom (NYSE: VIP) from its Pan European Buy List and downgraded shares to Neutral from Buy.
  
• Silicon Precision (NASDAQ: SPIL) was downgraded to Hold from Buy at ABN Amro.
  
• Lehman downgraded Amylin Pharmaceuticals (NASDAQ: AMLN) to Underweight from Equal Weight.
  
• Baird downgraded Dionex (NASDAQ: DNEX) to Underperform from Neutral.

Analyst downgrades: HLYS, C, ALVR, UBS and ALU originally appeared on BloggingStocks on Thu, 01 Nov 2007 11:10:00 EST. Please see our terms for use of feeds.

Heelys Inc. (NASDAQ: HLYS) makes sports equipment directed at children in the 6 to 14 year-old age bracket. The firm's primary product is footwear that features a removable wheel in the heel. Users can transition from walking to skating, by shifting weight to the heel. The company sells footwear, protective gear and apparel items through such retailers as Nordstrom (NYSE: JWN). Nike (NYSE: NKE) is a competitor.

The stock fell sharply in August, when the firm said it faced excess inventory at many U.S. retail outlets, but it popped late last week, when Heelys introduced a broad new line of wheeled-footwear colors and styles. The move boosted the share price through 30-day and 50-day moving average resistance curves into a bullish "flag" consolidation pattern. Prices frequently exit flags moving in the same direction they were traveling when they entered them. In this case, that would be to the upside. The catalyst for such a move may prove to be Wednesday's announcement that the company plans a November roll-out of a non-wheeled footwear line, featuring a sole that resembles a video game controller. Four video games will come free in the shoe box. The stock has a very high short ratio and a short-squeeze may be developing.

Brokers recommend the issue with six "holds." Analysts expect a 14% average annual growth rate, through the next five years. The HLYS P/E ratio (6.30), Price to Sales ratio (1.03), Price to Book ratio (2.36), Price to Cash Flow ratio (6.11), Sales Growth rate (140%), EPS Growth rate (191%), Operating Margin (25.34%), Net Profit Margin (16.65%), Return on Assets (56.53%), Return on Investment (70.06%) and Return on Equity (70.06%) compare favorably with industry, sector and S&P 500 averages. Institutions hold about 44% of the outstanding shares. Over the past 52 weeks, the stock has traded between $7.65 and $40.09. A stop-loss of $8.50 looks good here.

Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com.

Heelys (HLYS): Broadening the definition of "foot traffic" originally appeared on BloggingStocks on Thu, 18 Oct 2007 10:05:00 EST. Please see our terms for use of feeds.

This spring, the SEC will be holding a round-table discussion on shareholder litigation. Observers have been arguing for years that shareholder litigation is a burden to corporate America, putting our financial markets at a competitive disadvantage.

A few weeks ago, I wrote about the class-action lawsuits being filed against Heelys Inc. (NASDAQ: HLYS):

I could swear securities lawyers have invented a sophisticated computer program capable of seeking out public companies to target with class-action lawsuits. A company reports a bad quarter, the stock tanks, and then for the next few weeks, press releases seem to come out daily announcing a class-action lawsuit "commenced ... on behalf of purchasers of ... stock issued pursuant or traceable to the false and misleading Registration Statement filed with the Securities and Exchange Commission in connection with the Company's ... initial public stock offering.

While I certainly support the right of shareholders to collect damages in instances of real fraud, it seems that every time a stock price drops, multiple firms file lawsuits. These suits divert management's attention from the business and burn up resources on legal fees. All of this would be fine, except that these suits very rarely go anywhere. And even when they do, shareholders rarely collect anything.

I'm not sure what the solution to this situation is, or even if there is one, but it's an important issue for the SEC to be looking at.

SEC mulls shareholder lawsuits originally appeared on BloggingStocks on Sun, 23 Sep 2007 17:10:00 EST. Please see our terms for use of feeds.

I could swear securities lawyers have invented a sophisticated computer program capable of seeking out public companies to target with class-action lawsuits. A company reports a bad quarter, the stock tanks, and then for the next few weeks, press releases seem to come out daily announcing a class-action lawsuit "commenced ... on behalf of purchasers of ... stock issued pursuant or traceable to the false and misleading Registration Statement filed with the Securities and Exchange Commission in connection with the Company's ... initial public stock offering."

The press release will then mention some important dates and vague accusations of securities fraud.

Heelys Inc. (NASDAQ: HLYS) the maker of the annoying skate shoes that so many young kids are wearing is the latest target of these lawsuits. Take a look:

• Brower Piven announces...
• Lerach Coughlin announces...
• Schatz Nobel Izard announces...
• Howard G. Smith announces... This prestigious firm even gives you an e-mail address if you have any questions: howardsmithlaw@hotmail.com (emphasis added).

These firms put out the press releases in an effort to find plaintiffs, and then hope to get the cases to discovery so they can fish for signs of wrongdoing.

Continue reading Lawyers line up to sue Heelys (HLYS)

Lawyers line up to sue Heelys (HLYS) originally appeared on BloggingStocks on Sun, 02 Sep 2007 15:40:00 EST. Please see our terms for use of feeds.

Confusing potential with value originally appeared on BloggingStocks on Mon, 13 Aug 2007 20:30:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• Radian Group (NYSE: RDN) was downgraded to Hold from Buy with a $23 target at Citigroup on concerns over the company's potential merger with MGIC Investment (MTG).

• Heelys (NASDAQ: HLYS) was downgraded to Neutral from Outperform at Baird, to Hold from Buy at Brean Murray, to Neutral from Overweight at JP Morgan, to Sector Performer from Outperformer at CIBC and to Market Perform from Outperform at Wachovia following the company's FY07 guidance which was well below the consensus.

• Sonus Networks (NASDAQ: SONS) was downgraded to Sell from Neutral at Merriman, as the firm believes there are a number of concerns that are not reflected in shares, including a flat N-T revenue outlook, a cut in 700bp in gross margins and a sharp uptick in receivable days, among other things.

• LeapWireless (NASDAQ: LEAP) and MetroPCS were both downgraded to Hold from Buy at Citigroup, as they believe the break in subscriber momentum will last for 6-9 months. Wachovia downgraded Leap Wireless to Market Perform from Outperform citing mixed Q2 results and weak Q3 guidance.

• UBS removed Coca-Cola (NYSE: KO) and Coach (NYSE: COH) from its Strategic Stock Selection List.

• Jones Apparel (NYSE: JNY) was downgraded to Sell from Neutral at Merrill Lynch.

• CBRE Realty (NYSE: CBF) and Dick's Sporting Goods (NYSE: DKS) were downgraded to Hold from Buy at Citigroup.

Analyst downgrades: COH, HLYS, JNY and KO originally appeared on BloggingStocks on Wed, 08 Aug 2007 11:04:00 EST. Please see our terms for use of feeds.

Shares of Heelys Inc. (NASDAQ: HLYS), makers of those god-awful and potentially dangerous wheeled sneakers, plunged more than 45% this morning after the company warned that its earnings would be nowhere close to what Wall Street analysts had expected.

The company expects profit of 28 cents to 30 cents and revenue of $55 million to $55.8 million. Analysts had expected profit of 38 cents on revenue of $68.4 million, according to Reuters.

I have one thing to say to all of the people who bought this stock when it traded at a ridiculous multiple: hah hah. You should have known better. Fads eventually end. Anyone who thought this stock wouldn't crash and burn was either naive or delusional

The only question I have now is whether Crocs Inc. (NASDAQ: CROX) is next. My colleague Georges Yared is super bullish on this stock. I don't share his enthusiasm. Whenever I see a Crocs display lately, it always looks like it hasn't been touched for a while.

Remember, you investors can be bulls or bears. Pigs get slaughtered especially those wearing sneakers with wheels on them.

Hurray! Heelys (HLYS) is tanking, maybe Crocs (CROX) will be next originally appeared on BloggingStocks on Wed, 08 Aug 2007 10:25:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• Baird believes Heelys (NYSE: HLYS) is poised to report strong results through FY07, which is not reflected in current valuation, and started shares with an Outperform rating and $47 target.

• JMP Securities believes a growing number of consumers will opt to acquire books and physical CD audio books digitally over the internet and started shares of Audible (NASDAQ: ADBL) with an Outperform rating and $12.50 target.

• Caris believes Response Genetics' (NASDAQ: RGDX) diagnostics opportunity may represent a significant long-term growth driver and initiated shares with a Buy rating and $7.50 target...

• JP Morgan initiated DeVry (NYSE: DV), Corinthian Colleges (NASDAQ: COCO) and Strayer Education (NASDAQ: STRA) with Overweight ratings, ITT Educational Service (NYSE: ESI), Apollo Group (NASDAQ: APOL) and Career Education (NASDAQ: CECO) with Neutral ratings and Universal Technical Institute (NYSE: UTI) with an Underweight rating.

Analyst initiations 7-16-07: CECO, COCO, HLYS and UTI originally appeared on BloggingStocks on Mon, 16 Jul 2007 10:31:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• Research in Motion was upgraded to Outperform from Market Perform at Morgan Keegan. RBC Capital upgraded shares to Top Pick as they see continued upside from product momentum. Banc of America upgraded to Buy from Neutral following the company's Q1 results and announced stock split. JMP Securities upgraded to Market Outperform from Market Perform, saying confidence in demand and recent checks indicate very strong backlog and forecasts.
  
• Komag was upgraded to Neutral from Underweight at JP Morgan following the buyout offer from Western Digital.
  
• Western Digital was upgraded to Strong Buy from Buy at Needham, as the firm believes Western Digital's acquisition of Komag is a strategic positive and that accretion will likely be significantly better than guidance.

• Deutsche Bank upgraded shares of Rohm and Haas Company (NYSE: ROH) to Buy from Neutral.
  
• Robbins & Meyers Inc (NYSE: RBN) was upgraded to Neutral from Underperform at Robert W Baird & Co.
  
• Heelys Inc (NASDAQ: HLYS) was upgraded to Sector Outperformer from Sector Performer at CIBC World Markets.
  
• BMO Capital upgraded the educator sector to Market Perform from Underperform, and Apollo Group Inc (NASDAQ: APOL) to Outperform from Market Perform.

Analyst upgrades 6-29-07: RIMM's quad upgrade originally appeared on BloggingStocks on Fri, 29 Jun 2007 09:55:00 EST. Please see our terms for use of feeds.

By the power vested in me by AOL, its corporate parent Time Warner Inc. (NYSE: TWX), and those associated with the above entities, I declare the Heelys Inc. (NASDAQ: HLYS) fad to be over.

Mr. and Mrs. America, you will no longer be forced to dodge hordes of tweens flying around the mall in their God-awful and unsafe wheeled sneakers thanks to my sinister and cunning plan. I am urging my fellow thirty-something suburbanites to buy Heelys and roll on them in public. Once kids see how dorky we look "heelying," they will surely give up their expensive, trendy footwear, which they will grow out of sooner rather than later.

Perhaps the market is anticipating my plan. Shares of Heelys, which was one of the most highly touted IPOs last year, have slumped about 3% this year. Parents everywhere should rejoice. The company, unlike Crocs Inc. (NASDAQ:CROX), is a one-trick pony, and fads do eventually end.

Continue reading Parents rejoice! Heelys won't be cool much longer

Parents rejoice! Heelys won't be cool much longer originally appeared on BloggingStocks on Thu, 31 May 2007 16:45:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• Deutsche Bank upgraded shares of both British Airways (NYSE: BAB) and Ryanair Holdings plc (NASDAQ: RYAAY) to Hold from Sell on valuation.

• Credit Suisse upgraded shares of Cox Radio Inc (NYSE: CXR) to Neutral form Underperform on valuation following the stock's recent pullback. Bear Stearns also upgraded Cox Radio to Outperform from Peer Perform on valuation.

• Merrill Lynch upgraded shares of Autoliv Inc (NYSE: ALV) to Neutral from sell.

• Wachovia upgraded Heelys, Inc (NASDAQ: HLYS) to Outperform from Market Perform following positive channel checks, which could lead to upside to the Street's Q1 EPS estimate of 18c, and valuation.

• Stifel upgraded VistaPrint Ltd (NASDAQ: VPRT) to Buy from Hold with a $43 target. The firm said risks from taxes and non-transaction revenue have been diminished to levels that allow them to focus on the core printing business.

• Ameristar Casinos, Inc (NASDAQ: ASCA) was upgraded to Buy from Hold at Jefferies.

• Bear Stearns upgraded Waddell & Reed Financial, Inc (NYSE: WDR) to Outperform from Peer Perform based on strong operating leverage and valuation.

• Potash Corp (NYSE: POT) was upgraded to Buy from Neutral at UBS.

Analyst upgrades 4-05-07: Cox Radio, Heelys & Potash Corp were upgraded today originally appeared on BloggingStocks on Thu, 05 Apr 2007 10:46:00 EST. Please see our terms for use of feeds.

BloggingStocks writer Georges Yared wrote an excellent piece yesterday in which he wondered whether Crocs Inc. (NASDAQ:CROX) is the next L.A. Gear. If it is, that is not good news for CROX shareholders. As Yared writes, L.A. Gear rose to prominence in the mid- to late-1980s, and faded into oblivion during the 90s (although it is currently working on a comeback). Clothing, particularly when marketed to the teen demographic, is probably the most fickle industry on the planet. As Jerry Reed sang, "When you're hot you're hot ... when you're not you're not."

Investors should tread extremely carefully when investing in hot clothing products. If the popularity of the product wanes, so will the earnings, and so will the stock price. Predictably, many of these companies attract the attention of that much maligned group of investors known as short-sellers, who seek to profit by betting on a declining stock price.

Here's a list of some of what I consider to be the top "Retail Fad" stocks going right now. As a word of warning, I am not saying all these products will turn out to be fads:

Continue reading Beware of these three retail fads companies

Beware of these three retail fads companies originally appeared on BloggingStocks on Thu, 22 Feb 2007 09:57:00 EST. Please see our terms for use of feeds.

MAJOR PAPERS:

• Highlights from today's Wall Street Journal (subscription required):
• Dell Inc (NASDAQ: DELL) has been accused in an investor lawsuit of improper accounting in its partnership with Intel Corporation (NASDAQ: INTC).
• News Corporation's (NYSE: NWS) MySpace is looking to forge partnerships to enter the Chinese market.

• The U.K. Times reported that Rio Tinto plc (NYSE: RTP) has warned that the future of its only operation in the U.K. is bleak, with negotiations on its future having failed to deliver a solution.
• The Washington Post said, according to a National Intelligence report, that the situation in Iraq will get worse and the United States has little control over it.
• Investor's Business Daily's "New America" column mentioned Heelys (NASDAQ: HLYS) positively, saying there is plenty of room for growth in the wheeled sneaker market, although cautioning it could be a fad like rollerblades or the Razr scooter before it.
  
• From BusinessWeek's "Inside Wall Street" column:
• Weyerhaeuser Company (NYSE: WY) named Debra Cafaro, a well-regarded REIT executive, to its board, sending a "clear signal that Weyerhaeuser will be looking at moving its huge timberlands into a REIT," says Mark Wilde of Deutsche Bank.
  
• Archer Daniels Midland Company (NYSE: ADM) should rise to $6 a share this year, says Carl Birkelbach, president of Birkelbach Investment Securities
  
• Access Pharmaceuticals' (NASDAQ: ACCP) two cancer drugs -- one of which, MuGard, has already been O.K.'d by the Food & Drug Administration -- are catching the eye of investors.

Newspaper wrap-up 2-2-07: MySpace looking for partners in China originally appeared on BloggingStocks on Fri, 02 Feb 2007 09:15:00 EST. Please see our terms for use of feeds.