Posts related to ‘Product Review’

eBay Crashes on Saturday (EBAY)

eBay Inc. (NASDAQ: EBAY) is having an issue which may have just cost sellers millions and millions of dollars in untold profits today.  After doing random searches today on Christmas present purchases and with eBay being one of the online destinations, it was suddenly clear that something was wrong on eBay.  The system was not working if you did not already have your item numbers known.  Search functions yielded nothing and stores were out.  If this were to happen after midnight on a Tuesday, it might not matter.  But this outage is on a weekend day when so many buyers and sellers aren’t at work and are able to spend the effort to go eBaying.

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Posted on: November 21, 2009 – 6:51 pm in Consumer Electronics, Consumer Goods, Internet, Luxury, Product Review, Retail,

Black Friday Gimmicks & Desperation, A Win For Consumers (WMT, BBY, COST, TGT, KSS, GPS, M, JWN, MA, AMZN)

We are right at a week away from the highly awaited Black Friday for 2009’s holiday and Christmas season.  As you likely know, this is THE day that retailers look forward to all year and critically depend upon as an anchor to how each retailer’s full year earnings results turn out.  You may already be tired of Christmas ads and the holidays haven’t even arrived yet.  With over 10% unemployment, a recession-end that doesn’t feel like a recession-end, a very tight discretionary spending budget, and a general lack of consumer confidence, it is no surprise at all that the focus for the Holiday Season in 2009 is one of deals and thrift.

These are not in any particular order, but the promotions have been reviewed at Wal-Mart Stores Inc. (NYSE: WMT), Best Buy Co. (NYSE: BBY), Costco Wholesale Corporation (NASDAQ: COST), Target Corp. (NYSE: TGT), Kohl’s Corp. (NYSE: KSS), Gap Inc. (NYSE: GPS), Macy’s, Inc. (NYSE: M), and Nordstrom Inc. (NYSE: JWN).  There is also already promotion between MasterCard Incorporated (NYSE: MA) and Amazon.com Inc. (NASDAQ: AMZN).  Admittedly, this is just a sampling of major outlets.

What is amazing is just how much of the deal-making is already out before the holiday season starts as retailers key off of each other.  It is almost impossible to avoid thinking how such a promotional Christmas and Holiday Season in 2009 is going to add pressure to margins at almost all the first-line retailers.
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Posted on: November 19, 2009 – 12:54 pm in Apparel, Calendar, Editor's Picks, Entertainment, Luxury, Product Review, Retail, , , , , , , , , ,

Martha Stewart Lands at Home Depot (MSO, HD, SHLD, M)

Martha Stewart ImageHD LogoMartha Stewart Living Omnimedia Inc. (NYSE: MSO) has a new exclusive product lineup partner. We still want to know where Martha will end up after the K-Mart deal she has with Sears Holdings (NASDAQ: SHLD) expires, although a new partnership unveiled today does not specifically address that question and does not sound  “exclusive” despite the term being used.

The Home Depot Inc. (NYSE: HD) announced an agreement today with Martha Stewart Living Omnimedia to develop an exclusive Martha Stewart Living brand of home improvement products.  It was not noted that this will have any impact on the K-Mart agreement and it still notes that Macy’s Inc. (NYSE: M) is one of the many retailers where Martha Stewart products will be available.
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Posted on: September 14, 2009 – 4:40 pm in Consumer Goods, Entertainment, Housing, Luxury, Product Review, Retail, , , ,

Budweiser Returns For US Investors (BUD, TAP, SAM, HOOK)

Bud Image Budweiser is back for US investors.  It has been some time that US investors have been able to invest in an large beer company since  Anheuser-Busch was acquired by InBev.  But it is coming back to a US-stock-listing. Anheuser-Busch InBev has announced that starting Wednesday, September 16, its ADR will list on the NYSE under the old “BUD” ticker.  The NYSE listing upgrades the company´s existing Level I ADR program, which was launched on July 1, 2009.

It has been hard for US investors to invest in the beer market.  Molson Coors Brewing Company (NYSE: TAP) was the largest, and despite its Denver HQ many are under the impression that they are investing in the Canadian Molson beer company since Coors and Molson merged.  Besides that for US-beer plays, investors have only had Boston Beer Co. Inc. (NYSE: SAM) with a small $550 million market cap and the micro-cap stock Craft Brewers Alliance Inc.   (NASDAQ: HOOK) to invest in with its $57 million market cap.

Following the Peter Lynch mantra, investors can once again invest in the company of a brand they regularly use.

JON C. OGG
September 11, 2009

Posted on: September 11, 2009 – 12:42 pm in ADR, Buffett, Calendar, Consumer Goods, Editor's Picks, Exchange News, Food, Mergers and Buy Outs, Product Review, Retail, , , ,

Giving Away Vegas To Get Traffic in Vegas (WYNN, LVS, MGM)

money-stack-imageIf you have ever stayed at the Wynn resort or the even newer Encore in Las Vegas, you will know that calling either a high-end resort and casino destination may represent an understatement of the year.  Wynn Resorts Ltd. (NASDAQ: WYNN) has not been immune to the woes of Las Vegas despite the stock more than doubling from recent lows.  Las Vegas Sands Corp. (NYSE: LVS) is also in this boat along with every other casino operator.  But if you are one of the 90.8% of the employed and are one of the privileged consumers who has escaped the recession without much damage, the summer deals in Vegas are almost too good to be true. There are similar deals being offered by the Las Vegas Sands Corp. (NYSE: LVS) and by MGM Mirage (NYSE: MGM).  If you are unencumbered by the economy, Vegas is almost free right now.
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Posted on: June 18, 2009 – 10:40 am in Casinos, Entertainment, Luxury, Product Review, , ,

Microsoft (MSFT) May Offer Huge Price Cut For Windows 7 Pressuring Margins

balllmerMicrosoft (MSFT) may price Windows 7 as low as $100 to offset the effects of the recession on PC operating system sales and the public’s rejection of Vista, the current version of Windows.

The price cut would be unprecedented. It could drive up sales of Microsoft’s software and PCs in general. It could also put intense pressure on Redmond’s margins and sales. Read More »

Posted on: June 8, 2009 – 5:04 am in PC Companies, Product Review, Software, , , , , ,

Palm Pre, Short Supply, Sell-Outs Not All Instant (PALM, S, AAPL, RIMM, BBY)

Palm Pre ImageSaturday morning marked the awaited launch of the Pre smartphone from Palm Inc. (NASDAQ: PALM) under an exclusivity carrier pact with Sprint Nextel Corp. (NYSE: S).  We think this will offer some competition to Apple Inc. (NASDAQ: AAPL) for the iPhone and some for Research in Motion Ltd.’s BlackBerry (NASDAQ: RIMM), but how much real competition is another matter.  We started the calls to prominent stores located in prime areas of cities late morning Saturday to give them time to check-out the first buying customers.  We had to use Best Buy (NYSE: BBY) in the store call-ins, but some Sprint stores in hot locations still had phones.  This was far from a nationwide survey on Saturday morning, but here are the notes from our calls:

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Posted on: June 6, 2009 – 12:40 pm in Consumer Electronics, Product Review, Short Interest, Telecom, Trading Alert, Wireless, , , , ,

Palomar’s Chance To Take Away from BOTOX (PMTI, JNJ, AGN)

Money Stack ImagePalomar Medical Technologies Inc. (NASDAQ: PMTI) is seeing shares surge to new heights not seen in 18-months.  The company is the first to receive FDA approval for over-the-counter clearance for a new, patented home use laser device that for the treatment of periorbital wrinkles (for eyes, like crows feet). The beauty of this, no pun intended, is that it is part of a Johnson & Johnson (NYSE: JNJ) partnership and that may lead to much greater use.  This one will not exactly kill the entire Botox market for Allergan, Inc. (NYSE: AGN), but even for one such possible replacement the idea of a home-use laser has to be a bit more enticing than getting stuck with a needle full of Botulinum toxins.
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Posted on: June 5, 2009 – 11:49 am in Entertainment, FDA, Healthcare, Luxury, Medical, Product Review, , ,

Discovery Says Amazon Kindle Infringes Its Patent (DISCA, DISCB, DISCK, AMZN)

kindle-imageDiscovery Communications, Inc. (Nasdaq: DISCA, DISCB, DISCK) has filed a patent infringement suit against Amazon.com, Inc. (NASDAQ: AMZN)  regarding the Amazon Kindle e-book reader.
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Posted on: March 17, 2009 – 11:40 am in Entertainment, Internet, Law, Product Review, , , ,

Cybex Treadmill Recall, One More Woe (CYBI)

Cybex_treadmillCybex International Inc. (NASDAQ: CYBI) has another issue to worry about besides a stalling economy and weak sales of exercise equipment ahead.  The Consumer Product Safety Commission released today that the company is subject of a product recall for roughly 19,000 treadmills.  The Cybex recall is for treadmill risks due to fall hazards where the machine can unexpectedly speed up without notice due to a malfunction with the lower control board.

The company has received 24 reports of incidents involving thetreadmill unexpectedly increasing speed, including six reports ofconsumers falling. Three of those incidents resulted in minor injuries.  This has also come at a price on its stock, and the company’s shareholders probably don’t want any more financial injury on top of product injury.

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Posted on: October 29, 2008 – 12:04 pm in Product Review, Shareholder Issues,

Take-Two’s GTA4 Retail Checks…. Maybe Take-Two Can Defend Against EA (TTWO, ERTS, GME, BBY)

We at 247WallSt.com have made calls doing our own checks to see just how the new blockbuster mega-hit Grand Theft Auto 4 video game from take-Two Interactive (NASDAQ: TTWO) is selling at some of video game dedicated stores.  Figures that have been thrown around for the first week are $400 million, and if you do a Google search under "GTA4 $400M" you’ll see how many are running this figure.

As Take-Two Interactive (NASDAQ: TTWO) tries to defend itself against a takeover (or to get a higher price) from Electronic Arts (NASDAQ: ERTS), we wanted to see just how well this game could do.  This is being sold through thousands of stores and many of the locations are completely sold out.  Only a few acted like they had an oversupply of games.  Literally many of the larger stores were stocked with games for those who did not pre-order, but those supplies were being eaten through quickly.  This is also before school and work ended for the bulk of the gaming population, so that’s another catch.

We decided to run a store check the opening morning at store locations for GameStop Corp. (NYSE: GME), Best Buy (NYSE: BBY), and even the new entrant called Play N Trade.  It goes quite simply like this, the larger the store the harder it is to round up someone that can or will give you an answer.  As well as this game is selling, and with a record breaking sales projection because of the dual-console platform launch, it’s hard to imagine that the company is just going to fold up its tent in defending itself.  If Electronic Arts wants the video game maker, they are trying to buy a company that will have a remarkably improved sales position compared to when the bid was first launched.  The opposite side of the argument is that one title might not make a difference in a decade long time frame.

Many did well in the midnight sales, and here are just a handful of the comments that the employees at the stores said from each store listed.  Please note that while these are in quotes, they are in context but this was the general comment of what we were told at each individual store:

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Posted on: April 29, 2008 – 2:26 pm in Mergers and Buy Outs, Product Review, Video Games, , , ,

Consumer Electronics Show Device Launches (AMD, HIMX, LOGI, MCZ, MSFT, PXLW, RNWK, SNE, YHOO)

The Consumer Electronics Show kicked off last night with a keynote from Bill Gates (supposedly his last) and there are many product announcements being shown from large and small tech companies alike.  Here are some of the key product launch features being shown so far:

Advanced Micro Devices (AMD) unveiled its ATI Mobility Radeon 3000 graphics processor for notebooks and its Xilleon panel processor for LCD TV image quality; AMD shares up 1%.

Himax (HIMX) is in a new strategic alliance with 3M (MMM) over ultra-mobile digital projectors; HIMX stock up almost 6%.

Logitech (LOGI) is demo’ing its new sleek line of computer peripherals and entertainment devices.

Mad Catz (MCZ) will have its recently acquired Saitek unit with new Cyborg line including keyboard, mouse, headset, and peripherals.

Microsoft (MSFT) said at "CES" it had 100 million licenses sold of Windows Vista; 17.7 million Xbox 360’s, 10 million Xbox live users; will have new content downloads with Disney, ABC, and more; showcasing new GPS; MSFT shares up 1%.

Pixelworks (PXLW) launched its Keystone Correction Post-processing IC for digital projectors.

RealNetworks’ (RNWK) is partnering with Philips for its Rhapsody player for in-home audio and GoGear portable devices.

Sony (SNE) is debuting a new digital camcorder with triple recording in a hard drive, memory stick, and disk for ultra-compatibility among digital platforms; shares up 3%.

Yahoo! (YHOO) announced a platform neutral mobile ecosystem for mobile web content at CES with a new redesigned Yahoo! mobile launch page; shares up 0.5%.

Please be advised that there will be hundreds of product launches and partnerships announced out of the Consumer Electronics Show this week.  This is only a small snapshot of new devices we saw from various announcements and press releases.

Jon C. Ogg
January 7, 2008

Posted on: January 7, 2008 – 9:15 am in Product Review, Technology Companies, , , , , , , , ,

Amazon.com’s Kindle Only Available For Scalpers (AMZM, EBAY, SNE)

We were quite interested in Amazon.com’s (NASDAQ:AMZN) upcoming product release for the new e-book reader, the Kindle.  Interestingly enough it almost immediately sold out of its initial supply and gave its first website update with an estimated December 5 ‘availability date’ to buyers.  That was right around Thanksgiving.  But if you look at the site now, forget about this being a Christmas or Hanukkah gift for 2007.  See below:

Availability: Temporarily out of stock. Order now and we’ll deliver when available. We’ll e-mail you with an estimated delivery date as soon as we have more information. Your credit card will not be charged until we ship the item. Ships from and sold by Amazon.com. Gift-wrap available.
Kindle Availability:  Due to heavy customer demand, Kindle is temporarily sold out. Because we ship Kindles on a first-come, first-served basis, please ORDER NOW to reserve your place in line. Your Kindle will not arrive by December 25th. Note that Kindles cannot currently be sold or shipped to customers living outside of the U.S.

But there is at least one place you can buy the Kindle.  eBay (NASDAQ:EBAY) has many Kindle units on auction, for quite a premium.  As of now and depending upon the seller’s rating at eBay, the bids are in excess of $600, $700, and even over $800….. not bad for the seller considering that this retails at Amazon.com for $399.00 for those who can be patient for yet a few more weeks.

Walt Mossberg at the WSJ only gave Kindle a so-so review.  You can always buy the ‘lower-features’ eBook reader from Sony Corp. (NYSE:SNE/ADR) for $299.95… and you can buy it on Amazon.com.

Jon C. Ogg
December 4, 2007

Posted on: December 4, 2007 – 2:57 pm in Internet, Product Review, , , , ,

Amazon.com’s Kindle e-Book Reader Sold Out: Hype or Mega-Hit? (AMZN)

Amazon.com (NASDAQ:AMZN) is apparently already sold out of its new Kindle electronic book reader.  That is what the launch and intro page for the Kindle notes. What is not clear is if this is part of a publicity stunt or if this is already lining up to be a game changer.  There haven’t been any formal figures as to how many readers have really been sold and there wasn’t coverage on how many were being made for the first launch.

Kindle Availability: "Due to heavy customer demand, Kindle is temporarily sold out. Because we ship Kindles on a first-come, first-served basis, please ORDER NOW to reserve your place in line. See availability messaging above for estimated in-stock date."  Availability: In stock on December 5, 2007.

Sony has had one of these out for some time, and it has barely registered as a footnote in the grand scheme of things as Sony.  Sony’s Reader Digital Book is less robust than Kindle and has been on the market much longer, and it costs $299.99.  Sony has also had promotion of 100 free e-book offers for e-book reader purchases between August 4, 2007 and January 31, 2008.  Amazon’s Kindle reader is $399.00, but it acts more like a portable written media device as it allows newspapers, blogs, and more to be connected wirelessly through the same high-speed data network (EVDO) as advanced cell phones.

Jon C. Ogg
November 23, 2007

Posted on: November 23, 2007 – 7:06 am in Entertainment, Internet, Product Review, , ,

Starbucks 2008 Valuation: $18, $22, or $26 (SBUX, PEET, MCD, CBOU, THI)

We wanted to run some up and down scenarios for Starbucks now that the noise from the research calls have gotten out of the way and now that the post-earnings dust has settled.  All calculations are made from its earnings release and its own guidance and we left those off to save space.

STARBUCKS TODAY & AHEAD 

At $23.00, its trailing P/E is 26.4, operating margins fell 0.3% to 11.2%; comparable sales growth for the year was 5% (only 4% for last quarter).  Starbucks had 10,684 stores in the U.S. as of September 30, 2007, and a total of 15,011 if you include international stores.  2,571 of those were opened in the last year. 

It plans to open another 2,500 net stores globally in 2008, with 900 of those owned and 700 licensed in the U.S. alone. Revenue growth is estimated at 17% to 18%.  Its 2008 diluted earnings were put at $1.02 to $1.05 (listed as 17% to 21% growth), so at $23 it has a forward P/E of 22.22 one year out. Starbucks is also launching first TV ad campaign, and that is factored into the numbers ahead.  So that means they are hoping that boost brand loyalty.

THE COMPETITIVE FIELD

Peet’s Coffee & Tea (NASDAQ:PEET) is looking for 17% to 20% in 2008 revenue growth and its forward P/E ratio for 2008 is roughly 35.  It is increasing to 15-20 new markets next year with grocery store expansion.  Unfortunately, it is only planning to expand to 30 new retail locations  in 2008.  Peet’s home and office delivery is a premium business, but unfortunately it isn’t going to be able to grow enough to make a huge difference.

The rise of McDonald’s (NYSE:MCD) has been meteoric and frankly far better than most would have guessed.  Personally, it isn’t exactly our favorite go-to coffee destination.  Maybe that isn’t fair and maybe that’s holding on top an old stereotype.

Caribou (NASDAQ:CBOU) has failed miserably in throwing up any real competition and it has not been able to draw away much traction.  Its stock is on another year low today, even though Wall Street was happy its failed CEO this week announced he’d only serve as Chairman.  It has 473 locations and its market cap is now just under $94 million.

Frankly, I can’t comment on Tim Hortons (NYSE:THI) as a competitor except for a store visit  in Canada two summers ago.  Its market cap is now $7.3 Billion and had 3,110 system-wide stores (with only 352 in the U.S.).  We also haven’t even addressed Dunkin Donuts or Krispy Kreme.  There are plenty of competitors now and the field won’t merit anymore 40 P/E coffee plays.

Frankly, I still enjoy going to Starbucks the best.  Peet’s is fine too, and Caribou is behind it.  I will continue paying my $2.12 for the Venti Bold, even if my prices have gone up without me using milk in a socialism coffee ploy. 

THE VALUATION CALCULATIONS

24/7 Wall St. covers is the stock angle. We did our own in-store review around the country stores close to us back in early 2007 because we wanted to see what the company was lacking in its store before it launched on that massive growth expansion.  The company still has a lot of room for improvement.  Starbucks will go through periods of time where it sees a rise from a trading move or from valuations compared to an oversold status.  But something is obvious as a heart attack, regardless of $18, or $22, or $26 in 2008.  Starbucks’ best days as a major growth and story stock are behind it.

A lot of this depends on the stock market performance and forward P/E’s there after the real debt and oil mess gets factored in.  If that holds steady then Starbucks may get to continue to justify a 25 P/E ratio and with that we get a $25.875 price (hence $26 rounded up).  But if the market stays sketchy then we think with the growth story contracting that this deserves a PEG ratio of roughly 1.0 and we’ll only give it a realistic forward P/E ratio of 17 or 18 ahead (and therefore $17.60 to $18.63, or $18 rounded).  If the market acts as more of a trading instrument and swings up 5% to 10% and then down 5% to 10% like we are getting used to, then today’s price of $22.00 seems like a fair pivot point.

You ought to see our beer and spirits review at 10 PM tonight.  Well, maybe not.

Jon C. Ogg
November 16, 2007

Jon Ogg produces the 24/7 Wall St. Special Situation Investing Newsletter; he does not own securities in the companies he covers.

Posted on: November 16, 2007 – 4:55 pm in Analyst Calls, Food, Product Review, Value Investing, , , , ,

More Lead Paint Recalls of Public Company Products (DIS, ENR)

The U.S. Consumer Product Safety Commission (CPSC) has announced more toy recalls today for lead paint violations.  There is a full list of product recalls here, but interestingly enough this may actually have an impact on more of the companies than just the ones noted herein.

Because these recalls announced today are "Winnie the Pooh" and "Pirates of the Caribbean" it could technically have an impact on Disney’s physical toy and physical merchandise.  It doesn’t mention the company and Disney has many outside arrangements, but guess who has the trademarks. 

We will be the first ones to point out the actual numbers of product recalls are small in the grand scheme of things, but there are many parents and consumer activists (as well as free trade activists/foes) that are watching this like a hawk.  There are also no known incidents of note.  We only included the ‘lead paint recall items’ in this. 

Public companies: Energizer (NYSE:ENR) and Walt Disney Co. (NYSE:DIS).  Below is a brief summary of the product recalls announced today:

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Posted on: October 4, 2007 – 1:16 pm in China, Entertainment, Law, Product Review, Regulation, , , , , , , ,

Can A New Dungeons & Dragons Version Insulate Hasbro From Current Toy Industry Woes? (HAS, MAT)

Mattel’s (NYSE:MAT) recalls are quite well known now.  We know that Chinese toys are being checked and tested and complained about across the board, and rightfully so.  Chinese suppliers have been exposed probably hundreds or thousands of times of cutting corners and using cheap or substandard materials all the way down to poison or contaminated goods.  So right now every toy company and consumer products company is testing their products from China.

This morning Hasbro (NYSE:HAS) announced that in light of Mattel’s woes that it too is intensifying safety checks on its own toys.  How could they be completely immune?  We didn’t exactly give Hasbro the world’s greatest marks on their announcement this morning, but there is another development that might actually help.  Hasbro has a franchise on its books that acts as a gift that keeps on giving: Wizards of the Coast, and the beloved Dungeons & Dragons (R) franchise.  This is the game that all the parents used to worry about their kids playing because of exaggerated and isolated instances of some kids losing their minds, and now all those parents read Harry Potter themselves.  It is still a puzzle as to whom the real joke is on.  But the Dungeons & Dragons franchise is about to get another formal makeover for next year.

Today Wizards of the Coast confirms that the new edition will launch in May 2008.  The new system will include illustrated rulebooks, pre-painted miniatures (test that paint boys), web-based tools, online community forums, faster game play, faster prep time, new character options, faster campaign building tools, online magazine content, and a digital game table for virtual and remote game playing.  There will be some book preview releases late this year and early next year, but the first live demos of 4th Edition will happen at the D&D EXPERIENCE(TM) gaming convention in Washington, D.C., in February 2008. The full scope of 4th Edition books, miniatures, and adventures will be available in the spring and summer of 2008.

This new 4th edition is dubbed the D&D Insider(TM).  Web estimates are far as total dollars spent on the gaming system are impossible to track because new sales often get recycled as used game sales and hand-me-downs.  Some estimates have 15 million game players over the history of the game and some estimates are north of 20 million players since its inception in the 1970’s.  Generally speaking, the game itself and the offshoots for it have been responsible for over $1 Billion in retails sales in the US alone.

Hasbro just expanded a prior share buyback plan by $500 million back in early August, and it is no secret that a crummy market is not helping stocks based on discretionary income.  Hasbro shares are down 1.5% today at $27.18, and the 52-week trading range is $19.13 to $33.49.  Apparently our interpretation of the Transformers(TM)  related sales already being baked into the cake was true and then some.

Jon C. Ogg
August 16, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers. 

Posted on: August 16, 2007 – 10:41 am in Entertainment, Product Review, , , , , , , , , ,

Starbucks Partially Ditched for McDonalds by Goldman Sachs (SBUX, MCD)

This morning Goldman Sachs has made several changes to its Americas Conviction Buy List, but the most interesting change was the dropping of Starbucks (SBUX).   Goldman Sachs said it was adding McDonald’s (MCD) as the replacement for Starbucks on the Conviction Buy List because Starbucks reached an imposed stop-loss limit. It was put on the list back in March and the shares had fallen 9.9% compared to gain in the S&P 500 of 8.8%.  Goldman also noted that the shares of Starbucks were down 23.3% over the last year, while the S&P is up more than 20%.

What is odd is that Goldman Sachs is actually maintaining an official "BUY RATING" on Starbucks as it believes it still has the most compelling risk/reward out of the coverage universe for the next 12-months.  Based on its discounted cash flow model, Goldman still has a $43 price target based on 36X CY2008.  What is interesting is the forward multiple, because it is quite obvious that there is a contraction occuring in in the multiple that people are willing to pay.  The risk/reward isn’t so much of an issue because new investors are buying shares at almost a 40% discount from the 52-week highs, it’s just that forward multiple and price target that seem a bit too aggressive based on the current environment.

Starbucks still has some lofty growth models ahead and it has a long way to go before it can adequately handle the new store volumes.  We gave an in-depth series of reviews at many of the stores ahead of its last earnings with some solutions for the company.  After a couple recent Strabucks visits it looks like some effort is being made, but it doesn’t seem right that Goldman Sachs is still using that forward multiple.

We recently noted some lessons that Starbucks could learn from McDonald’s.  Goldman Sachs has a $57 target on McDonald’s, representing 11% upside to yesterday’s close.

Jon C. Ogg
June 12, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: June 12, 2007 – 8:55 am in Analyst Calls, Food, Product Review, Research, Retail, ,

What Starbucks (SBUX) Could Learn From McDonald’s (MCD)

McDonald’s (MCD) credited much of its same store improvement to it co-promotion with animated hit movie "Shrek III". The fast food chain said global sales at stores open over a year were up 8.7%. In the US, where the company has higher market penetration, sales rose 7.4% over last year.

There is a lesson in this for Starbucks (SBUX). While a food and coffee chain visited by adults is not likley to benefit from and association with a children’s movie like "Shrek", that still leaves a number of movies, song artists, and product launches.

What would be wrong with giving out a free "Ocean’s 13" Blackjack card deck with every purchase over $10?  Maybe Starbucks could use another movie promotion like the "You’ve Got Mail" movie with Tom Hanks and Meg Ryan, which was openly referred to and thought of as a Starbucks and AOL promotional film. 

Douglas A. McIntyre

Posted on: June 8, 2007 – 9:03 am in Food, Product Review, ,

iPhone Pre-Sale Major Premiums on eBay (AAPL, EBAY)

Since the Apple (AAPL-NASDAQ) iPhone has been given the actually release date of June 29, 2007, it looks like the eBay (EBAY-NASDAQ) auction scalping is back on.  Keep in mind that despite the actual release and ship dates, this is really no different than the auction being a ’short sale’ with the key difference being an iPhone rather than shares of a stock.  The retail prices exclusively through AT&T (T-NYSE) on a first come first serve basis are 4GB at $499.00 or 8GB  for $599.00.

Two different auctions ending this evening already have a premium to the pricing with more than 12 hours to go.  These are pre-sale items, both are the 8GB versions.  One is already at $660.00 with 29 bids and another is at $610.00 with 18 bids.

What is perhaps more interesting (actually funny or ludicrous) than the iPhone scalping is the raw number of web domain name auctions that are pending.  One such auction has a minimum $1,000.00 indication and a BUY IT NOW feature price of $29,999.00 for ‘27 premium iPhone domain names.’  If you look up the domain names you may have some questions as to who would want them, because none of the domain names are "Why didn’t I think of that domain name?" web addresses that consumers would just randomly type in to see what iPhone services are out there.  This auction ends on Thursday June 7, 2007, and has no bids.

The domain name ‘apple-iphone2007.com’ did sell for $305.00 (Auction number 140120996252) on June 1, 2007 on eBay.  There was also an 8GB iPhone that sold for $99.00 (Auction number 330124992229).  There is always a premium on demand to supply for major limited release products.  But at what point does greed versus fear actually become crazy?

Jon C. Ogg
June 4, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: June 4, 2007 – 9:10 am in Consumer Electronics, Internet, Product Review, Technology Companies, Wireless, , ,