Twin Cities Business Journal Shopper Survey
30% Minneapolis shoppers prefer Cub
19% " " Target
4% " " Walmart
Why listen to some analyst taking the subway to work in NYC about
grocery shopping????? FWIW
Compared to other grocery stocks, SVU is cerntainly oversold. Thanks to Morgan Stanley's so-called analyst, the expection is even lower. I think it will be a pleasant surprise next week. As the economy improved in the last quarter of 2010, customers are more willing to consume better qualtiy grocery and shop in stores of better atomosphere. Go to Supervalu's store to check it out. You will see.
The downgrade was clearly known to some traders yesterday. This is an analyst who is not afraid of benefiting his pals. We have seen this before.
The analyst assumes enterprise value at 4.25 times Ebitda for SVU, while every other grocery retailer had enterprise value of minimum 5 times Ebitda. It emphasizes SVU downsides, while leaving the positive upsides as tiny possibility (5% chance or less). After all, each company has some downside.
Although the analyst used extensive numbers under his pessimistic assumptions. It makes me suspect his motives as he revises these numbers downward from his previous estimates just a week before the earnings. At best the analyst is not prudent.
In any case, the moment of truth comes next Tuesday morning when SVU will release Q3 number and guides for Q4 of fiscal 2011. I would be really surprised if the analyst's prediction of sales and profit numbers for Quarters 3 and 4 would hold water, given the recent improvement in retail environment.
Chfriend03, thanks for the insight. on the other hand, today not only MS but also BMO analysts issued bearish notes. also, KR just released its earning one month ago, which is bad. Do you really see no any negative factors in your tracking? thanks.
Lower expectations are easier to beat. Hopefully ,Management is smart enough to underpromise in order to be able to overdeliver! SVU took a beating today, but it had been way overbought and needed a correction (obviously there were many traders who decided to sell to book profits) The stock has now transitioned from a very overbought condition to one that is very oversold!