Monday, September 26, 2016

Zoe's Kitchen: That $24 Opportunity

After slightly weak guidance following the Q2 earnings report, Zoe's Kitchen (ZOES) has absolutely collapsed. The stock is now down from $38 to the $24 range providing a double bottom opportunity.

The valuation is reasonable at $475 million with revenues heading towards $333 million next year.  Check out these other research posts:

Zoe's Kitchen: Patience Rewards Investors With Dip Opportunity

Opportunities In Restaurant Stocks

Disclosure: Long ZOES. Please review the disclaimer page for more details. 

Why Twitter Is Unlikely To Accept A Buyout Offer

Reports of interests in bidding for Twitter sent the stock to multi-month highs.
The difference between what bidders will pay and where Twitter values the social media site suggests a deal is highly unlikely.
Investors wrongly confuse exploring options with accepting any imminent bid.
The good numbers from week 2 in the NFL support buying Twitter on any dips if the buyout surge deflates this week.
Twitter (NYSE:TWTR) shot up 21% on Friday to a recent high of $22.62 on news that the social media service was moving closer to being sold. The CNBCreport suggested that Alphabet (NASDAQ:GOOG)(NASDAQ:GOOGL) and Salesforce (NYSE:CRM) were seriously looking at making bids.
Read the full article at Seeking Alpha. 

Disclosure: Long TWTR. Please review the disclaimer page for more details. 

Sunday, September 25, 2016

Is Nike Under Assault?

The success of the last decade is leading to increased competition.
Increasingly, Adidas and Under Armour are making strides in endorsement deals by ramping up spending.
Nike is an expensive stock for one facing a more competitive environment.
In the business world, the typical price of success is increased competition. A company that has seen huge stock gains or generates large profits can expect a flood of new competition.
Read the full article on Seeking Alpha. 

Disclosure: No position mentioned. Please review the disclaimer page for more details. 

Friday, September 23, 2016

Twitter: Pump The Brakes

Twitter (TWTR) is soaring 20% today on news today that the company is in informal discussions regarding a sale of the business. According to the news, Alphabet (GOOG) and (CRM) are looking at a bid for the social media giant.

The big question is whether a Twitter shareholder even wants a deal. After the gains the stock has a market value of $15.7 billion. A decent value for the current revenue base, but the potential remains massive. What if the NFL streaming deal and the host of shows lining up for the site starts expanding the user base.

Facebook (FB) now has a market value of over $370 billion. Maybe it isn't possible to ever reach that level, but one could argue that these streaming deals with the likes of 120 Sports and Cheddar provide a compelling case for users to return to the service. If Twitter can really show that 800 million people view the site, than Twitter actually has half the user base of Facebook and no where near half the market valuation.

Thursday, September 22, 2016

Microsoft: Buyback Decisions Tell A Story

Microsoft announced new capital return plans including an 8% dividend hike.
The new stock buyback plan has limited ability to impact the stock considering the surging stock over the last few years.
The net payout yield is average for the current market.
After the close, Microsoft (NASDAQ:MSFTreleased that the company will add to the existing capital return program. The total of the share repurchase program is attention grabbing, but investors need to consider whether the amount is actual impactful to the stock.
Read the full article on Seeking Alpha. 

Disclosure: No position