Continue reading Closing Bell: Another Win (BRK.B, SIRI, CSTR, DE, WFMI)

Closing Bell: Another Win (BRK.B, SIRI, CSTR, DE, WFMI) originally appeared on BloggingStocks on Wed, 17 Feb 2010 16:10:00 EST. Please see our terms for use of feeds.

Time was, we all felt rich. And we all felt entitled to spend money on ridiculous items at chocolate stores like Godiva, coffee shops like Starbucks (NYSE: SBUX) and, yes, upscale supermarkets like Whole Foods (NASDAQ:WFMI).

Those days are long gone, and even today's reduced expectations for this extremely well-run company are possibly too optimistic. EPS for 2008 were down 20% and company shares, floating in the $7-$10 range, are well off of 52-week highs.

Continue reading Whole Foods Markets: Victim of a structural shift

Whole Foods Markets: Victim of a structural shift originally appeared on BloggingStocks on Wed, 18 Feb 2009 15:03:00 EST. Please see our terms for use of feeds.

With a lower-cost competitor entering the field in the form of McDonald's (NYSE: MCD) and grave concerns about the company's brand/future, you'd think Starbucks (NASDAQ: SBUX) would want to do everything it its power to retain its status as a premium brand.

You'd think. But you'd be wrong. The Wall Street Journal is reporting (subscription required) that Starbucks is discontinuing the sale of organic milk. To be fair, the rationale behind the decision is that the company has completed its switch to serving milk exclusively provided by cows not receiving artificial growth hormone. One of the main reasons consumers sometimes opt for organic milk is frequent use of hormones in regular milk and, given that drinks with organic milk (which the company charges extra for) account for only about 1% of beverage sales, this might seem like a smart move. The company says it's part of its strategy to cut down on the number of items on the menu, and emphasize more exciting options.

But I think that not serving organic milk will irritate a few customers -- I think we all know someone who won't touch anything that isn't organic. Starbucks needs to focus on pleasing its customers, even if that means a short-term slowdown in earnings growth.

Of course this won't have any material impact, and will probably save the company some money. But with Starbuck's in a battle to retain its iconic status, Schultz and company need to keep it as classy as possible.

Starbucks to cut organic milk from its menu originally appeared on BloggingStocks on Wed, 16 Jan 2008 04:32:00 EST. Please see our terms for use of feeds.

Trader Joe's jumps on anti-China bandwagon originally appeared on BloggingStocks on Mon, 22 Oct 2007 17:12:00 EST. Please see our terms for use of feeds.

I recently wrote a piece about how being more environmentally conscious can be great for your heart and health without hurting your pocketbook. Now SmartMoney's Kelli Grant has some great tips for going organic on a budget. Her five tips include setting priorities (buy organic where it really matters), consider your alternatives, buy on sale, buy from local farmers, and try generic brands.

But there's another side to this: One of the main culprits of the obesity epidemic is the wide availability of inexpensive, empty calories. Hostess cupcakes anyone? As former Senator Phil Gramm put it, "Has anyone ever noticed that we live in the only country in the world where all the poor people are fat?"

So buying organic foods, even if it does cost more, might be good for you. It could help you eat less! I would wager that if the average American kept their grocery budget the same but switched to organic foods, our collective waistline would shrink pretty substantially.

So remember: When it comes to food, paying a little more might be better for you.

Go organic ... cheap! originally appeared on BloggingStocks on Sun, 22 Jul 2007 14:40:00 EST. Please see our terms for use of feeds.

Continue reading Hain Celestial Group, Inc.: Organic gold

Hain Celestial Group, Inc.: Organic gold originally appeared on BloggingStocks on Thu, 05 Jul 2007 09:30:00 EST. Please see our terms for use of feeds.

Though it's not easy for consumers to be green, MSN Money's Abby Schutlz points out that it's possible to be environmentally sensitive and fiscally prudent.

Since buying organic food is expensive -- organic milk is about double the price of the conventional variety and produce can be 200% higher -- Schultz points out that people need to make an organic budget for their environmentally friendly purchases. This can be as simple as buying organic products when they are on sale to the price disparity isn't as great or purchasing produce such as cherries, grapes and peaches that retain less pesticide residue then their conventional counterparts.

I was particularly interested in the piece because I would like to be more environmentally conscious but, like many Americans, I'm not sure about how much I am willing to sacrifice economically to do that.

While hybrid cars are still quite expensive and will likely stay that way for awhile, Schultz advises readers that simply driving less is great for the environment too. And with our country in the midst of an obesity epidemic, walking or biking makes sense for a lot of reasons.

Similarly, simply cutting back on energy use probably does more good for the environment than expensive all-natural products.

So while being green-friendly might seem more expensive, many aspects of conservation will actually save money: Buying products in bulk with less packaging is cheaper, and so is using the library instead of the bookstore.

Does anyone have any tips for being environmentally conscious on a budget? I've talked to some friends, and one of the main reasons people don't make more of an effort to go green is the cost.

Being green ... it doesn't have to be expensive! originally appeared on BloggingStocks on Fri, 29 Jun 2007 17:40:00 EST. Please see our terms for use of feeds.

Oracle needs organic growth to drive stock originally appeared on BloggingStocks on Tue, 26 Jun 2007 11:01:00 EST. Please see our terms for use of feeds.

I'm not an expert on organic food, but this seems sort of weak: "The Department of Agriculture, the final arbiter of all things organic, is poised to approve a list of non-organic ingredients that can be used in food stamped with its green-and-white organic seal."

Correct me if I'm wrong, but isn't the whole point of organic food that the ingredients are organic? The organic advisory board recommended that 38 non-organic ingredients be added to a list of substances allowed in organic foods. Some complain that, while this may not be a significant event by itself, it's indicative of efforts by big businesses to water down the definition of organic to increase profits.

The industry and regulators must walk a tight line. Making minimal adjustments that don't change the meaning of organic substantially could make products more affordable for more Americans. That's good for everyone -- farmers, retailers, and consumers.

On the other hand, changing it to the point where organic no longer means anything (sort of like "homemade," which means nothing) would kill the industry.

Assuming the changes are made with little public outcry, it could be good for companies like Whole Foods Market, Inc. (NASDAQ: WFMI), which could see a decrease in its cost of goods. Passing the savings onto the consumer would result in more organic shoppers. As of right now, many Americans really can't afford to shop organic. Lowering prices could change that.

Watering down the definition of organic originally appeared on BloggingStocks on Tue, 12 Jun 2007 18:10:00 EST. Please see our terms for use of feeds.

Wal-Mart mislabeling organic foods? originally appeared on BloggingStocks on Thu, 10 May 2007 10:40:00 EST. Please see our terms for use of feeds.

Wal-Mart's ongoing impact on organic foods originally appeared on BloggingStocks on Tue, 03 Apr 2007 14:27:00 EST. Please see our terms for use of feeds.

Continue reading Organic grocery wars get heated: will Whole Foods fix a broken Wild Oats?

Organic grocery wars get heated: will Whole Foods fix a broken Wild Oats? originally appeared on BloggingStocks on Thu, 22 Feb 2007 22:55:00 EST. Please see our terms for use of feeds.

Continue reading Selling a farm-fresh lifestyle in a box

Selling a farm-fresh lifestyle in a box originally appeared on BloggingStocks on Thu, 04 Jan 2007 16:02:00 EST. Please see our terms for use of feeds.

A classic mistake of any individual investor is to maintain a position in a money-losing stock for too long. You calculate, you reason, you infer, you hope and, finally, you pray that it will come back. And still you hold on.

If you didn't, how would you prove you were right to have bought it in the first place?

That kind of thinking gets investors nowhere. The truth is, with money-losing stocks, it's often better to unload them and move on -- especially at this time of year when you can turn at least part of that investment loss into tax savings. (See more year-end tax tips.)

Review your portfolio. If you have a sizable loss and don't see a catalyst in the next few months that could drive the stock higher, sell now and reap the tax benefit. If you love a company, you can always buy it back next year (but be sure to wait at least 30 days so you don't violate the "wash sale" rule).

The following is a list of six companies covered at Blogging Stocks that are year-end "sell" candidates. These stocks are all down significantly year-to-date, face headwinds going forward, and -- perhaps most importantly -- have a tendency to inspire a somewhat irrational loyalty among the individual investors who own them. As they say in the dating world, maybe it's time to "take a break" from these names:

Yahoo! Inc. (Nasdaq: YHOO): It's still an Internet leader, to be sure. But competition from Google Inc. (NASDAQ:GOOG) is slaying this one-time giant while smaller, more nimble competitors are encroaching on its turf. Meantime, recent management reshuffling signals more turmoil ahead. The stock started the year at $41 and is now at $26 for a 36% year-to-date drop.

Sirius Satellite Radio Inc. (NASDAQ: SIRI) and XM Satellite Radio Holdings Inc. (NASDAQ: XMSR): A word of apology to all the fans of satellite radio out there. I know you love these stocks and are rooting for them to turn around. Maybe they will someday? But as Doug McIntyre wrote recently, it seems the more their businesses mature, the worse the stocks do. Sirius is down 42% this year and XM is off 47%. That's a tax loss you can take to the bank.

Continue reading Six loser stocks to consider selling now

Six loser stocks to consider selling now originally appeared on BloggingStocks on Tue, 12 Dec 2006 05:00:00 EST. Please see our terms for use of feeds.

Continue reading I am a 'Yoga Mama': We kick soccer moms' tushies

I am a 'Yoga Mama': We kick soccer moms' tushies originally appeared on BloggingStocks on Mon, 27 Nov 2006 08:11:00 EST. Please see our terms for use of feeds.

Whole Foods Market, Inc. (NASDAQ:WFMI) was reinstated as outperform on 11-10-06. This stock is very attractive to me based on the things I've read about it. If the analyst's assertions are true, and WFMI's stock lost value based on a simple change in management focus from business operations to maintaining share price, then what should be happening in timely fashion will be a moderated climb back up to WFMI's fair market value. Salim Haji, an excellent writer over at The Motley Fool, offers the opinion that this stock has an intrinsic value in the $50 to $60 range.

With additional consideration of the fact that WFMI is undertaking a strategic stock buy back program, if I was looking for some fun places to play with some funds, this would be one of them. It is my opinion that this stock deserves some close attention right now. I think it is headed back up. One other thing I take into consideration about this situation is the possibility that Wal-Mart is going to fall flat on its corporate face with its "organic" food roll out. If that happens, (and I think it will), then Whole Foods Market will add even a bit more sparkle to my eye!

You can learn more about organic foods at About Organics.

Whole Foods, poised for better things originally appeared on BloggingStocks on Sun, 12 Nov 2006 20:12:00 EST. Please see our terms for use of feeds.

Continue reading Organics are bad for you -- financially

Organics are bad for you -- financially originally appeared on BloggingStocks on Tue, 07 Nov 2006 14:51:00 EST. Please see our terms for use of feeds.

Shares of Whole Foods Market Inc. (NASDAQ:WFMI) tumbled more than 23% by midday in heavy trading to $46. Indications of this happening could already be seen yesterday in after-hours and this morning in pre-market trading as WFMI shares lost more than 17%.

**More recent news on Whole Foods**
Organics are bad for you, financially
Whole Foods $100 million stock buyback

Yesterday, the organic and natural foods retailer reported earnings of $39.8 billion, or 28 cent per share, a significant rise from last year's $9 million or 6 cents a share. Revenues also rose from $1.12 billion in the same period last year to $1.29 billion. Analysts were expecting $1.32 billion. Also same-stores sales rose 8.6%, but that is after a good run of double digits growth. To top it all, the company warned of slower growth in sales next year.

So despite what may sound as good growth for a retailer, it doesn't come close to the growth rate WFMI has experienced so far. It is also below what analysts had expected and worse, the outlook for 2007 is below estimates as well. This has caused analysts to warn that slowing consumer spending combined with tougher competition from mainstream grocery stores (remember even Wal-mart Stores, Inc. (NYSE:WMT) is now getting into organics) could squeeze Whole Foods. Alas, no more double-digit same-store sales figures in the foreseeable future.

Already B of A cut rating from "buy" to "neutral" and lowered the target price from $77.50 to $43. Morgan Stanley cut its price target on WFMI from $70 to $63.

If this continues, I wonder whether WFMI would cut prices enough for more people to shop there.

Whole Foods down 23% on disappointing earnings report originally appeared on BloggingStocks on Fri, 03 Nov 2006 13:59:00 EST. Please see our terms for use of feeds.

The TV commercials for the new line of organic cereals from Kellogg Company (NYSE:K) bring tears to my eyes. They're shot in a subdued color palette, evocative of the early 20th century, when every mama fed her children healthy, farm-fresh grains at a hand-hewn oak table in the family kitchen. Kellogg is trying to connect its products with the yearning to return to local, sustainable, homemade.

But Kellogg is nothing but not local. And the way big business is getting into organic food is, everyone seems to agree, perverting the very thing organics are meant to do. Not only that: if everyone had organic food, it wouldn't be organic any more. BusinessWeek calls it "The Organics Myth." And the reality is that you just can't mass-produce locality.

When Wal-Mart Stores, Inc. (NYSE:WMT) announced they'd be offering organic food this spring, everyone seemed to throw up their collective hands and say, well, there goes the organic farm! Lots of industry analysts wondered if the push into low-cost organics would only mean that smaller farmers got squeezed, more, and suppliers like Wal-Mart would end up knocking on the doors of the big commercial farm organizations for organic produce. (Or offering organics that wasn't "really" organic after all.)

But at the heart the argument seems ridiculous. No, we can't revert to an agrarian society. But the demand for organics so outstrips supply that (for instance) Stonyfield Farms has to vastly reduce the percentage of organic products it offers. (Meantime, more entrepreneurs are flooding into the healthy foods business. Check out all the franchise opportunities available). But why can't more commercial farms just adopt organic practices? Why is this so hard?

I think the answer can't be: buy organic Rice Krispies. The answer has to be something more complex, and it starts with educating consumers to eat differently, to buy produce in season from (real) local, organic farmers, instead of insisting on oranges and asparagus year-round. To be more flexible, to roll with the punches.

No, not everyone can have organic fresh green peas year round. But everyone can have some organics, some of the time, and I think that's what we should all be working toward.

Organics for everyone are organics for no one? originally appeared on BloggingStocks on Fri, 06 Oct 2006 21:44:00 EST. Please see our terms for use of feeds.

What was the biggest thing in earnings news yesterday? Well, depending on your investing bias, it was either Burger King (BKC), which reported its first public quarter with a seven cents per share loss; or Whole Foods (WFMI), which is down big after reporting a good profit yesterday, but missing estimates on sales and offering what analysts are calling "confusing" guidance for full-year 2006 and 2007 sales. Bear Stearns rates Whole Foods at "underperform" and UBS has a "neutral" rating.

The stocks were both down sharply yesterday; Burger King was down $2.01, or 13%, to $13.24 (with a slight recovery in after-hours trading); and Whole Foods fell $6.76, or nearly 12%, to $50.75.

Let's say you're the average food investor, wondering: should I put my money where my health is? Or go for the fatty deep-fried flavor? Where's the value?

Continue reading Whole Foods vs. Burger King, organic vs. fast food: where's the value?

Whole Foods vs. Burger King, organic vs. fast food: where's the value? originally appeared on BloggingStocks on Wed, 02 Aug 2006 15:43:00 EST. Please see our terms for use of feeds.