Posts for Ticker ‘CAG’

Defensive Stocks Offering No Haven (WMT, PEP, KO, TAP, KFT, CAG, CPB, HRL, MCD, MO, VGR, RAI, PG, CL, MRK, JNJ, NVO)

Burning Money PicWasn’t it just last week that we were up eight days in a row on the DJIA?  And now we have a sell-the-news reaction to the recent growth numbers.  Maybe it is because we ran too far too fast and because we started pricing in robust growth rather than muted growth.  But generally when equities have stayed hot and then start to sell off in profit taking or in case things got too heated, you at least see a migration into some of the defensive stocks.  That is not the case.  In our normal 16 Defensive Go-To Stocks, only ONE was up.  If you throw in Wal-Mart Stores Inc. (NYSE: WMT) as the ultimate defensive stock like we usually do, then you have only TWO of 17 trading up on the day….

PEPSICO INC (NYSE: PEP) $56.1805.. Down $0.4895; -0.86%
COCA COLA CO (NYSE: KO) $48.58.. Down $0.19; -0.39%
MOLSON COORS CO. (NYSE: TAP) $47.01.. Down $0.37; -0.78%
KRAFT FOODS INC. (NYSE: KFT) $28.08..  Down $0.27; -0.95%
CONAGRA FOOD INC. (NYSE: CAG) $20.13.. Down $0.40; -1.95%
CAMPBELL SOUP CO. (NYSE: CPB) $30.86.. Down $0.50; -1.59%
HORMEL FOODS CORP. (NYSE: HRL) $37.00..    Up 0.05; +0.14%
MCDONALDS CORP. (NYSE: MCD) $55.72.. Down $0.51; -0.92%
ALTRIA GROUP INC. (NYSE: MO) $18.13.. Down $0.16; -0.83%
VECTOR GROUP LTD. (NYSE: VGR) $15.71.. Down $0.07; -0.44%
REYNOLDS AMERICAN (NYSE: RAI) $45.17.. Down $0.54; -1.18%
PROCTER GAMBLE CO. (NYSE: PG) $53.05.. Down $1.06; -1.96%
COLGATE PALMOLIVE (NYSE: CL) $71.82.. Down $0.89; -1.21%
MERCK CO INC. (NYSE: MRK) $31.79.. Down $0.64; -1.97%
JOHNSON & JOHNSON (NYSE: JNJ) $59.88.. Down $0.56; -0.92%
NOVO NORDISK (NYSE: NVO) $60.024.. Down $0.986; -1.62%

Oddly enough, Wal-Mart is the ONLY one of the DJIA 30 components trading higher this afternoon.

JON C. OGG
SEPTEMBER 1, 2009

Posted on: September 1, 2009 – 2:31 pm in Defensive Stocks, Trading Alert, , , , , , , , , , , , , , , , ,

Mini Earnings Season on Deck Thursday (PALM, ACN, MU, LEN, CAG, FINL, JTX, TIBX)

Money Stack ImageThursday is shaping up to be a miniature one-day version earnings season this week.  This is likely the last of the major earnings reports we’ll see for another three or four weeks until the real earnings season for Q2-2009 kicks off.  On deck are the likes of Palm Inc. (NASDAQ: PALM), Accenture Ltd. (NYSE: ACN), Micron Tech Inc. (NYSE: MU), Lennar Corporation (NYSE: LEN), ConAgra Foods, Inc. (NYSE: CAG), Finish Line (NASDAQ: FINL), Jackson Hewitt Tax Service Inc. (NYSE: JTX), and TIBCO Software Inc. (NASDAQ: TIBX).  Below are preview summaries for each company’s expectations and supporting notes.
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Posted on: June 24, 2009 – 4:34 pm in Earnings, Housing, Technology Companies, , , , , , , ,

Top Analyst Upgrades & Downgrades (BHP, BPI, CAG, COP, ETFC, FDX, MRVL, RTP, SONC, SBUX)

These are the top ten early bird analyst upgrades and downgrades from Wall Street early this Tuesday morning with more than two hours until the market opens.

BHP Billiton (BHP) Raised to Buy at Citigroup.
Bridgepoint Education (BPI) Cut to Neutral at Credit Suisse.
ConAgra (CAG) Raised to Buy at UBS.
ConocoPhillips (COP) Raised to Outperform at Bernstein.
E*TRADE (ETFC) Raised to Outperform at FBR.
FedEx (FDX) Raised to Overweight at JPMorgan.
Marvell Technology (MRVL) Cut to Hold at Deutsche Bank.
Rio Tinto (RTP) Raised to Buy at ING.
Sonic (SONC) Raised to Outperform at Oppenheimer.
Starbucks (SBUX) Raised to Outperform at Baird.

Jon C. Ogg
June 23, 2009

Posted on: June 23, 2009 – 6:25 am in Analyst Calls, , , , , , , , , ,

Top 10 Analyst Upgrades & Downgrades (AMG, AG, IRE, CAG, GPN, JASO, LEA, NTGR, ODFL, YHOO)

These are ten of the top analyst upgrades, downgrades, and initiation calls we have seen from Wall Street early this Monday morning with about two hours until the market opens:

Affiliated Managers Group (AMG) Raised to Outperform at KBW.
AGCO (AG) Raised to Buy at Jefferies.
Bank of Ireland (IRE) Cut to Hold at Deutsche Bank.
ConAgra (CAG) Cut to Hold at Citigroup.
Global Payments (GPN) Raised to Outperform at William Blair.
JA Solar (JASO) Cut to Hold at Lazard.
Lear (LEA) Cut to Underweight at Barclays.
Netgear (NTGR) Raised to Hold at Deutsche Bank.
Old Dominion Freight (ODFL) Raised to Outperform at Morgan Keegan.
Yahoo! (YHOO) Raised to Buy at Citigroup.

JON C. OGG
June 15, 2009

Posted on: June 15, 2009 – 6:43 am in Analyst Calls, , , , , , , , , ,

Defensive Stocks Refuse To Participate In Rally (PEP, KO, TAP, KFT, CAG, CPB, HRL, MCD, MO, PG, CL, MRK, JNJ)

Investors flock to defensive stocks in times of trouble and and when they worry, assuming they look to stay in the market when they are worried.  But if the trend here continues, this may be one of the worst times for defensive stocks compared to the overall market.  Our universe of 13 large-cap go-to defensive stocks looks awful in relative performance and it looks like only 1 stock of the 13 has actually outperformed the overall market.

Kraft Foods Inc. (NYSE: KFT), ConAgra Foods, Inc. (NYSE: CAG), and Hormel Foods Corp. (NYSE: HRL) have performed close to the overall markets, but that is almost it.  Forget about Campbell Soup Co. (NYSE: CPB) as that has been the worst of the lot.  Pepsico, Inc. (NYSE: PEP) and The Coca-Cola Company (NYSE: KO) are up double digits from recent lows, but are way behind the market index readings.  Even the high and mighty McDonald’s Corp. (NYSE: MCD) has greatly underperformed.
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Posted on: May 7, 2009 – 5:31 am in Defensive Stocks, HI/LOW, Index, Technical Analysis, , , , , , , , , , , , ,

Top Pre-Market Analyst Downgrades (ADLR, MDRX, CRDN, CAG, IFF, MFE, TWX, VRTX, VOD, WWWW)

These are some of the top analyst downgrades and negative calls we are seeing this Wednesday morning:

  • Adolor (ADLR) Cut to Neutral at Piper Jaffray.
  • Allscripts (MDRX) Cut to Neutral at Piper Jaffray.
  • Ceradyne (CRDN) Cut to Underperform at Wachovia.
  • ConAgra (CAG) Cut to Neutral at JPMorgan.
  • International Flavors (IFF) Started as Underweight at Lehman.
  • McAfee (MFE) Cut to Underperform at FBR.
  • Time Warner Inc. (TWX) Cut to Market Perform at Bernstein.
  • Vertex (VRTX) Cut to Perform at Oppenheimer.
  • Vodafone plc (VOD) Cut to Neutral at Credit Suisse.
  • Web.com (WWWW) Cut to Market Perform at FBR.

Jon C. Ogg
September 3, 2008

Posted on: September 3, 2008 – 7:06 am in Analyst Calls, , , , , , , , , ,

Box Of Cereal Headed To $100 (KFT)(K)(SLE)(CAG)(TSN)

118464064385856_fullNo one should be surprised that food companies are passing along tremendous increases in the prices of commodities. Consumers will be paying more for everything from hot dogs to corn flakes. Even the prices of Velveeta and Spam are going up.

According to the FT, "Kraft Foods (KFT), which has said it will push up its prices by 12-13 per cent this year, said some of its cheese categories could rise 25 per cent."

Sara Lee (SLE), Tyson (TSN), Kellogg’s (K), and ConAgra (CAG) are all planning similar increases.

Douglas A. McIntyre

Posted on: July 21, 2008 – 11:24 am in Food, , , , ,

When Defensive Stocks Fail Too (PEP, KO, BUD, TAP, KFT, CAG, CPB, HRL, MCD, MO, PG, CL, MRK, JNJ)

It used to be that DEFENSIVE STOCKS were the way to go during periods of uncertainty and during times of market sell-offs.  But now that isn’t even working out.  After we looked at our first line defensive stocks only a piss poor reading of 3 out of 14 were up on the day.  Sure the DJIA dipped under 12,000 briefly and closed down 131.24 at 12,029.06, and the overall trend of the market is bad and feels like it wants to go worse.  To make matters worse, one of the three that are up was up because it is a takeover play currently.

PepsiCo (PEP)                $65.06    -$0.81 (-1.23%)   
Coca-Cola (KO)               $53.16    -$0.80 (-1.48%)   
Anheuser-Busch (BUD)    $61.90    +$0.70 (+1.14%)   
Molson-Coors (TAP)         $55.53    +$0.70 (+1.28%)   
Kraft (KFT)                       $30.00    -$0.32 (-1.06%)   
ConAgra (CAG)                $22.01    -$0.44 (-1.96%)   
Campbell Soup (CPB)       $33.51    -$0.25 (-0.74%)   
Hormel (HRL)                   $35.75    -$0.41 (-1.13%)   
McDonalds (MCD)            $58.21    -$1.00 (-1.69%)   
A’tria (MO)                       $20.71    -$0.01 (-0.05%)   
P&G (PG)                        $65.00    -$0.80 (-1.22%)   
Colgate Palmolive (CL)      $71.71    -$0.68 (-0.94%)   
Merck (MRK)                    $34.86    +$0.18 (+0.52%)   
J&J (JNJ)                          $64.44    -$1.15 (-1.75%)   

In an environment where consumers are spending less and less it seems that even the safe haven stocks aren’t immune as they once were.  Every one of these operations is suffering from issues that weren’t present, or not as much, in 2007 and 2006 such as a weaker consumer, higher energy costs, higher materials costs, and higher delivery/transport cost.  At a time where the market wants to buy agricultural stocks, energy and alternative energy, and defense/war stocks, the traditional names just aren’t working.  Pity.

Jon C. Ogg
June 18, 2008

Posted on: June 18, 2008 – 3:38 pm in Defensive Stocks, , , , , , , , , , , , , ,

Investors Searching For Defensive Safe Havens (PEP, MRK, JNJ, KO, BUD, KFT, CAG, CPB, HRL, MCD, MO, PG, CL)

Investors usually try to find stocks where they run for cover when the stock market is in turmoil.  This Monday is no exception after seeing the Bear Stearns implosion "takeunder" and the related fall in Lehman.  Those are almost never financial stocks, and you can bet those aren’t the case today.  We keep an index of defensive stocks for crummy markets.  Usually these hold up on down days or don’t fall as much as the market in general.  Today there are very few hiding spots out of our normal go-to defensive stocks.

Defensive Stocks Higher:

  • PepsiCo (NYSE:PEP) $68.67 (+$0.22; 0.32%)
  • Merck (NYSE: MRK) $41.18 (+$0.21; 0.51%)   
  • Johnson & Johnson (NYSE: JNJ) $63.30 (+$0.65; 1.04%)   

Defensive Stocks Lower:   

  • Coca-Cola (NYSE:KO) $57.43 (-$0.10; -0.17%)   
  • Anheuser-Busch (NYSE: BUD) $45.68 (-$0.52; -1.13%)   
  • Kraft Foods (NYSE: KFT)    $29.79 (-$0.08; -0.27%)   
  • ConAgra (NYSE: CAG) $21.15 (-$0.13; -0.61%)   
  • Campbell Soup (NYSE: CPB) $31.41 (-$0.28; -0.88%)   
  • Hormel Foods (NYSE: HRL) $40.16  (-$0.36; -0.89%)   
  • McDonalds (NYSE: MCD) $53.82 (-$0.96; -1.75%)   
  • Altria (NYSE: MO) $70.25 (-$1.53; -2.13%)
  • Procter & Gamble (NYSE: PG) $66.62 (-$0.12; -0.18%)   
  • Colgate Polmolive (NYSE:CL) $75.99 (-$0.29; -0.38%)   

Sometimes there is just no good place to hide.  The good news is that last night and in the wee hours of this morning things were looking far worse than they are right now.

Read More »

Posted on: March 17, 2008 – 9:28 am in Defensive Stocks, , , , , , , , , , , , ,

Top 10 Analyst Calls (AIG, AAPL, CMCSA, CAG, DRIV, ETEL, DNA, PBG, PDLI, SURW)

These aren’t the only analyst calls we are watching, but these are the top ten that 247WallSt.com is reviewing:

  • AIG (AIG) reiterated Buy at Goldman Sachs.
  • Apple (AAPL) target raised to $249 from $243 and estimates raised to $5.40 at Bear Stearns.
  • Comcast (CMCSA) downgraded to Neutral from Buy at Goldman Sachs (maybe late yesterday call).
  • ConAgra (CAG) started as Outperform at Bear Stearns.
  • Digital River (DRIV) downgraded to Hold from Buy at Deutsche Bank.
  • eTelecare (ETEL) started as Outperform at FBR.
  • Genentech (DNA) downgraded to Hold at Jefferies.
  • Pepsi Bottling Group (PBG) downgraded to SELL from Neutral at Goldman Sachs.
  • PDL BioPharma (PDLI) raised to Overweight Lehman Brothers.
  • SureWest Comms (SURW) started as Buy at Jefferies.

Jon C. Ogg
December 6, 2007

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

Posted on: December 6, 2007 – 8:01 am in Analyst Calls, , , , , , , , , ,

Largest Van der Moolen Specialist Stocks (VDM, ANF, APA, CAG, DDS, DIS, HOG, HTZ, HPQ)

We have already noted the Van der Moolen (NYSE:VDM) exit of all NYSE Specialist activities.  What we wanted to look at is the underling stocks companies where Van der Moolen acts as a specialist to the companies.  The huge list can be found at http://www.vdm-usa.com/clients/alpha.asp

Please be advised that these may have changed because we’ve already seen two merger stocks on the full list that are no longer traded.  This was taken from Van der Moolen’s site, so any errors there probably means they already laid off the I.T. editor for its web site.

Here are some of the names: Abercrombie & Fitch Co. (ANF), Apache Corp. (APA), Coach Inc. (COH), Conagra Foods Inc. (CAG), Dillard’s Inc. (DDS), Disney (DIS), Harley-Davidson Inc. (HOG), Hertz Global Holdings, Inc. (HTZ), Hewlett-Packard Co. (HPQ)…. more to come in a part II story.

Jon C. Ogg
November 15, 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 15, 2007 – 9:35 am in Brokerage Firms, , , , , , , , ,

Defensive Stocks Show Rotation Out of Tech (PEP, KO, BUD, TAP, KFT, CAG, CPB, HRL, MCD, MO, VGR, RAI, PG, CL, MRK, JNJ, NVO)

The markets haven’t fallen apart after yesterday’s 360 point dive on the DJIA, but we are still trading a tad lower today.  Now that Cisco Systems is showing you can’t just automatically hide out in all big technology stocks, it appears that investors who want to keep equity exposure are flocking to the DEFENSIVE STOCK names.  You can see below on our ticker list of defensive stocks that only Campbell Soup (NYSE:CPB) is not up today out of our 17 go-to defensive stocks.

DJI            13,249.05    -50.97    (-0.38%)   
S&P500    1,473.49     -2.13       (-0.14%)
NASDAQ   2,718.11    -30.65     (-1.12%)

PEP    $60.77    +$0.81 (1.35%)   
BUD    $50.29    +$0.23 (0.46%)   
TAP    $54.25    +$0.36 (0.67%)   
KFT    $33.37    +$0.04 (0.12%)   
CAG    $23.03    +$0.02 (0.09%)   
CPB    $35.50    -$0.08 (0.22%)   
HRL    $35.16    +$0.09 (0.26%)   
MCD    $59.21    +$0.83 (1.42%)   
MO      $72.75    +$0.77 (1.07%)   
VGR    $21.89    +$0.30 (1.39%)   
RAI     $63.71    +$0.64 (1.01%)   
PG     $70.07    +$0.65 (0.94%)   
CL     $75.33    +$0.01 (0.01%)   
MRK   $54.59    +$0.39 (0.72%)   
JNJ    $64.20    +$0.29 (0.45%)   
NVO  $123.41   +$1.72 (1.41%)   

Out of the top 10 holdings in the NASDAQ 100 QQQ (NASDAQ:QQQQ), only Microsoft (NASDAQ:MSFT) and Qualcomm (NASDAQ:QCOM) are trading up.  Unlike prior cautionary days, technology is giving back at least some of the gains today after the Cisco news last night.  It’s hard to tell a trend reversal if it is only the first or second day, but you can at least see where the money is going today (and it isn’t flocking back into financials yet).

Jon C. Ogg
November 8, 2007

Posted on: November 8, 2007 – 12:08 pm in Defensive Stocks, , , , , , , , , , , , , , , , ,

Defensive Stocks Show No Panic Rotation (PEP, KO, BUD, TAP, KFT, CAG, CPB, HRL, MCD, MO, VGR, RAI, PG, CL, MRK, JNJ, NVO)

With the markets down so much today on the financial stock fallout after the Citi downgrade/concern and with oil stocks listing lower after the Exxon miss, we wanted to show a brief comparison of DEFENSIVE STOCKS versus the market today.  If the market does start to get shaky, many of these defensive stock names are where traders will look to hide their equity money.  That may be even more-so the case now that the fiscal year-end window dressing trade for mutual funds has played out.

If you look below the top defensive stocks, which are all trading lower today, are by and large not down as much as the broad market but they aren’t showing any massive defensive interest either.  Of the 30 DJIA components, only 3 are positive today and they are all technology related. 

DJIA            13,727.52 (-202.49/-1.45%)
S&P500      1,527.59  (-21.79/-1.41%)
NASDAQ    2,829.27  (-29.85/-1.04%)

PEP    $73.19    (-0.53/-0.72%)   
KO      $61.63    (-0.13/-0.21%)   
BUD   $50.95    (-0.33/-0.64%)   
TAP    $55.83    (-1.40/-2.45%)   
KFT    $32.98    (-0.43/-1.29%)   
CAG    $23.50    (-0.23/-0.97%)   
CPB    $36.51    (-0.47/-1.27%)   
HRL    $36.21    (-0.27/-0.74%)   
MCD   $59.29    (-0.46/-0.77%)   
MO      $72.63    (-0.30/-0.41%)   
VGR    $21.62    (-0.26/-1.19%)
RAI      $63.49    (-0.94/-1.46%)   
PG       $69.44    (-0.08/-0.12%)   
CL       $75.03    (-1.24/-1.63%)   
MRK    $57.93    (-0.33/-0.57%)   
JNJ      $64.91    (-0.26/-0.40%)   
NVO    $122.55   (-2.14/-1.72%)

So today may be a bad day and decliners may be greatly higher than advancers, but there is not any major fear going on even if the VIX is back over 21.0 right now. Of course that can change, but that isn’t the case so far.

Jon C. Ogg
November 1, 2007

Posted on: November 1, 2007 – 12:30 pm in Defensive Stocks, , , , , , , , , , , , , , , , ,

Defensive Stock Picks Better Than The Market (September 7, 2007)

We are frequently asked about how certain basket picks perform compared to the overall market.  It has been years since anyone has claimed their stocks should gain regardless of the market because most people have smartened up to that nonsense.  But "Defensive Stocks" do perform better in general on a relative basis in down markets.  That isn’t a guarantee and that isn’t an absolute, but at least they did today.

Out of the 30 DJIA components, only J&J was up on the day.  Out of the 17 defensive stocks we gave earlier this morning, 3 of the 17 closed up.  On average of the 17 defensive stocks, if you invested in each one equally the picks would have ‘only’ been down 0.85% out of the basket.  That is better than the DJIA, S&P 500, and NASDAQ. 

For whatever it is worth, it’s worth noting that ‘relative performance’ doesn’t necessarily pay bills if the market heads too far south.  Here is how the markets fared compared to the defensive stock picks:

                  CLOSE      CHANGE    PERCENT
DJIA         13113.38    -249.97     -1.87%
NASDAQ    2565.7      -48.62       -1.86%
S&P500    1453.55     -25.00       -1.69%

Tick     Close       Change   Percent
PEP     $67.98      $(0.58)    -0.85%
KO       $54.59      $(0.07)    -0.13%
BUD     $49.84      $0.14       0.28%
TAP      $89.24      $0.56        0.63%
KFT      $32.89      $(0.50)    -1.50%
CAG     $25.52      $(0.06)    -0.23%
CPB     $35.54      $(1.14)    -3.11%
HRL     $34.99      $(0.81)    -2.26%
MCD     $49.24      $(0.52)    -1.05%
MO        $67.39      $(0.88)    -1.29%
VGR     $22.98      $(0.09)    -0.39%
RAI       $63.77      $(0.36)    -0.56%
PG        $65.47      $(0.64)    -0.97%
CL        $65.43      $(0.57)    -0.86%
MRK     $49.57      $(0.90)    -1.78%
JNJ      $61.68      $0.02         0.04%
NVO     $113.00    $(0.47)     -0.40%

Jon C. Ogg
September 7, 2007

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

Posted on: September 7, 2007 – 3:32 pm in Defensive Stocks, , , , , , , , , , , , , , , , ,

“Time To Go Defensive, Again?” (PEP, KO, BUD, TAP, KFT, CAG, CPB, HRL, MCD, MO, VGR, RAI, PG, CL, MRK, JNJ, NVO)

If you ever heard the old saying "Be careful what you wish for, you may get it!" it sure seems like we are there.  It also makes you wonder if it is time to go back into Defensive Stocks.  The defensive stock plays are where investors plunk their money when they are less optimistic but still want exposure to stocks.  The DJIA is down over 150 points on the day so far, yet some of these defensive stock plays are barely down. 

Today and this week is the perfect storm for what the stock market was hoping for to deliver a rate cut:

  • Job creations negative for the first time in four years
  • Alan Greenspan says this is similar to 1987 and 1998
  • Weak as could be auto sales
  • Weak home sales
  • Credit woes and delinquencies spilling over
  • mixed retail picture 

These are the ones you eat, drink, and smoke,and they tend to be around medicines and personal products. Here are the basics for defensive stock plays:

  • You have to drink. Coca-Cola (NYSE:KO) and Pepsi (NYSE:PEP) are usually a coin toss over performance versus relative value in the beverage plays.  Anheuser Busch (NYSE:BUD) is supposed to win because people drink more beer when they are miserable; or if you don’t mind crossing the northern border a tad you can always look at Molson Coors Brewing Company (NYSE:TAP). 
  • You have to eat.  Kraft (NYSE:KFT) maybe too tied to activists, Buffett, Phillip Morris, or whatever, but it’s monster play in the sector.  ConAgra (NYSE:CAG), a food giant that is fairly valued.  You can always look at Campbell Soup (NYSE:CPB) or even Spam-maker Hormel (NYSE:HRL).
  • McDonalds (NYSE:MCD) is deemed the best fast food play off the mid to lower income, as supposedly people will still eat out somewhere.
  • Smokers sometimes do rule.  Altria (NYSE:MO) is supposed to win since history has dictated that people don’t quit smoking when they are stressed out over job security and money.  Cramer had this as one of the TOP 2007 PICKS, but for different reasons.  You can always pick Vector Group (NYSE:VGR), or Reynolds American (NYSE:RAI) as well.
  • In personal products, Proctor & Gamble (NYSE:PG) and Colgate-Polmolive (NYSE:CL) tend to get into your pocketbook unless you stop shaving, washing hands, and brushing your teeth.  The choice of the two usually boils down to relative value and performance.
  • Go-to names in drug and medicine stocks are Merck (NYSE:MRK) and Johnson & Johnson (NYSE:JNJ).  A good runner up is Novo Nordisk (NYSE:NVO), even if it is and ADR lower in market cap and based in Denmark, as they are the major insulin play for diabetes treatments.

These are far from great exciting tech plays, but this is the strategy that traditional investors have used whenever it is time to go defensive.  As a reminder, if the stock market is going to really slide then almost everything falls with it.  Defensive stocks in theory are supposed to fall less and are the ones that traditional investors usually start tip-toeing back into first.

Jon C. Ogg
September 7, 2007

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

Posted on: September 7, 2007 – 9:46 am in Defensive Stocks, , , , , , , , , , , , , , , , ,

How Are Defensive Stocks Doing? (KO, MRK, PG, CAG, BUD, HRL, MO, CG MCD, KFT, GM)

Last Friday, we wrote about defensive stock havens for a crummy stock market.  We also warned that in true market selling extremes there is no such thing as a true haven, and stocks that do "less bad" are still down.  But interestingly enough, some of these names are holding up rather well.  These or related stocks are where investors start to look when things aren’t falling off a cliff.  Here is how the market fared today, followed by the performance of defensive stocks:

DJIA                13,270.68 (-387.18; -2.83%)
S&P500         1,453.09 (-44.40; -2.96%)
NASDAQ        2,556.49 (-56.49; -2.16%)
10YR-Bond   4.79% (-0.07%)

THE ONES THAT WORKED, OR NOT SO BAD ANYWAY

Coca-Cola Co. (NUSE:KO) closed down only 1 penny at $55.85, just under recent highs of $55.88. That’s not too bad.  Does anyone ever stop drinking sodas or water?  Pepsi (NYSE:PEP) isn’t faring as well with a 2% drop to $68.50, but that is still close to its $70.17 recent highs.  McDonalds (NYSE:MCD) fell only 0.7% in regular trading to $49.93, down from recent highs of $53.22.  This is still better than the market as a whole, but this is still up close to 50% from year lows.  ConAgra (NYSE:CAG) fell 1.8% to $25.91, down from recent highs of $28.35.  The food giant is fairly valued, and this was positive some today.  Procter & Gamble (NYSE:PG) spent most of the day up and closed down only 0.3% at $64.97 and still close to recent highs of $66.30.  Not bad.  Afterall, they get into your pocketbook regardless of the market unless you stop shaving, washing hands, and brushing your teeth.

DEFENSIVE STOCKS NOT WORKING

Merck (NYSE:MRK) fell only 1.7% in a crummy day and never really got to be profitable.  Maybe a ‘less bad day’ is a good to some, but barely.  Altria (NYSE:MO) fell 2.7% to $67.67 and Carolina Group (NYSE:CG) also fell 3.5% to $72.33..  Maybe the market tank isn’t making everyone go smoke afterall.  Hormel (NYSE:HRL) fell 2.6% to $31.76 today, but this is now down from recent highs of $39.88.  Maybe SPAM is not that well regarded afterall. Kraft (NYSE:KFT) fell 4% to $31.45, aldo down a lot from the $37.20 recent highs.  Peltz and Buffett aren’t able to offer any stability?  Anheuser Busch (NYSE:BUD) fell almost 5% today to $48.50, down a lot from the 455.19 recent highs.  Booze, particularly cheap beer is supposed to do well.

General Motors (NYSE:GM) was the only one of DJIA components that closed UP…up a whole 3 cents to $34.85, but still.  Go figure.

Jon C. Ogg
August 9, 2007

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

Posted on: August 9, 2007 – 4:39 pm in Defensive Stocks, , , , , , , , , , , , ,

Defensive Stock ‘Havens’ For A Crummy Market (PEP, KO, MRK, NVO, PG, CAG, BUD, HRL, CL, MO, CG MCD, KFT, NVO, WTR)

It’s yet another crummy day in the markets with roughly a 280 DJIA point drop before the closing bell went off.  Bear Stearns added the most fuel at the end of the day, unemployment was not a big enough help, and American Home Mortgage (AHM) shut most operations.  There are many bulls still out there after the malaise ends, and the questions still seem to be around WHEN rather than IF.  As always, there are many unleveraged companies that make basic products that are deemed the defensive stocks.  We try to simplify the list of names down to the true economically immune names, although there in reality is no such thing as an immune stock.  Sell programs kicked in at the end of the day, and these probably got hit too. 

If you are looking for buys in a crummy market you want to usually look at the stocks that produce you goods you have to consume.  If you eat it, drink it, or smoke it, it’s a defensive stock.  We won’t stop using toiletries either.  There are many other defensive stocks, but here is a group of stocks from our classic list and we’ve removed the "leveraged names" and those which would do well only in a moderate economic drop.  Here goes:

Coca-Cola (NYSE:KO) and Pepsi (NYSE:PEP)….does anyone ever stop drinking sodas or water, or stop eating chips?

Anheuser Busch (NYSE:BUD)….if you drink alchohol, you only drink more when things are bad.

Hormel (NYSE:HRL)….canned meats, deemed on the cheap.  Spam is a delicacy somewhere, or at least that is people keep saying.

Kraft (NYSE:KFT)…. maybe it’s too tied to activists, Buffett, Phillip Morris, or whatever, but it’s monster play in the sector.

McDonalds (NYSE:MCD)….best fast food play off the mid to lower income, and they won’t always eat at home regardless.

ConAgra (NYSE:CAG)….food giant that is fairly valued.

Altria (NYSE:MO) & Loews Carolina Group (NYSE:CG)….who says smoking is all bad?  Smoking kills, but people insist on buying.

Merck (NYSE:MRK)….drug king did well on last earnings.

Proctor & Gamble (NYSE:PG) and Colgate-Polmolive (NYSE:CL)….they get into your pocketbook regardless of the market unless you stop shaving, washing hands, and brushing your teeth.

Here are two runner-ups:

Novo Nordisk (NYSE:NVO)…. This is a bit challenging since it’s an ADR based in Denmark, but they are virtually a pureplay on insulin and diabetics need it regardless of a market crash.

Aqua America (NYSE:WTR)….largest independent water and waste water play, although high P/E ratio.

As a final reminder, there is no such thing as a "HAVEN" if there is a total market crash.  If the market falls 5% in a day or two, these are probably going to get hit hard too.  But people will own stocks and many firms HAVE TO own stocks.  The defensive names are where they tend to flock to first.

Jon C. Ogg
August 3, 2007

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

Posted on: August 3, 2007 – 3:18 pm in HI/LOW, Large Cap Stocks, , , , , , , , , , , , , , ,

Defensive Stocks For a Crummy Market (KO, MRK, PG, CAG, BUD, HRL, CL, MO, MCD, KFT, NVO, WTR)

Stock Tickers: KO, MRK, PG, CAG, BUD, HRL, CL, MO, MCD, KFT, NVO, WTR

If you are a long-term bull and aren’t feeling panic after seeing a huge down day (of over 400 DJIA points earlier), you will be looking at today’s huge drop as another great chance to get in.  If you can find any technical comfort in the VIX, here’s our earlier note today regarding the VIX and the past extreme levels.  You’ll also probably look for defensive companies that are at least perceived to have a sort of ‘quality premium’ and lack of credit risks to their models.

This list has been modified from a prior list of 20 Defensive Stocks we provided earlier this year during the first mini-meltdown, with some tweaking to take current ‘credit risks’ into consideration.  Remember, these are usually the ones you eat, drink, or smoke…..

Here is a hit list from that original larger group with the leveraged names taken out to reflect today’s "risk-base" in the decision making.  There is no specific order to any of these, and obviously some of their direct competitors could just as easily be included.  This is just a hypothetical list, and everyone has to do their own homework.  Also keep in mind that even these names get hit when the market reacts this poorly.  Here are the names:

Coca-Cola (NYSE:KO)….does anyone ever stop drinking Coke or water?

Merck (NYSE:MRK)….drug king did well on last earnings.

Proctor & Gamble (NYSE:PG)….they get into your pocketbook regardless of the market.

ConAgra (NYSE:CAG)….food giant that is fairly valued.

Anheuser Busch (NYSE:BUD)….if you drink alchohol, you only drink more when things are bad.

Hormel (NYSE:HRL)….canned meats, deemed on the cheap.  Spam is a delicacy soemwhere.

Colgate-Polmolive (NYSE:CL)….they get into your pocketbook regardless of the market.

Altria (NYSE:MO)….who says smoking is all bad?  Product kills, but people insist on buying.

McDonalds (NYSE:MCD)….best fast food play off the mid to lower income, and they won’t always eat at home regardless.

Kraft (NYSE:KFT)…. maybe it’s too tied to activists, Buffett, Phillip Morris, or whatever, but it’s monster play in the sector.

Here are a couple more picks from the original second-line of defensive stocks, but this takes out some of the ‘perceived’ riskier names tied to financial impacts and the like:

Novo Nordisk (NYSE:NVO)….you won’t be seeing any diabetics cut their insulin treatments next week.

Aqua America (NYSE:WTR)….largest independent water and waste water play, although high P/E ratio.

Jon C. Ogg
July 26, 2007

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

Posted on: July 26, 2007 – 2:42 pm in HI/LOW, , , , , , , , , , , ,

Kraft (KFT): Never Give A Sucker An Even Break

"Never give a sucker an even break and never wise up a chump" — P.T. Barnum

Krafts’s (KFT) shares are up 7% on a rumor that Nelso Peltz has bought 3% of the company and wants to have talks about focusing on the firm’s more profitable products. A couple of months ago, the stock got boiling on a rumor that Warren Buffett liked the company.

Kraft is not in a great set of businesses. In the last quarter, revenue rose about 5% to $8.6 billion. Earnings dropped 30%. The company’s costs for the commodities it buys to make its products are rising. Increasing prices to consumers is tough. Companies like ConAgra (CAG), General Mills (GIS),  and Kellogg (K) want those customers, too.

Altria (MO), Kraft’s former parent, tried to get the company to perform better for years. They found out that selling cigarettes beats peddling food hands down.

Maybe Peltz will buy a piece of the company. But, he may face the same resistance that Carl Icahn faced at Motorola (MOT). Kraft’s fairly new CEO, Irene Rosenfeld, thinks she knows what she is doing. Her board is likely to give her some time.

But food is not a great business, no matter who wants to own the company.

Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.

Posted on: June 21, 2007 – 2:13 pm in Uncategorized, , , , ,

Market Trades For Super-Bulls, Chicken-Bulls, and Outright Bears

Stock Tickers: AAPL, GOOG, RIMM, BA, UTX, ATI, RTP, RIO, FLR, SGR, PEP, KO, BUD, CAG, HNZ, CPB, HRL, K, GIS, KFT, MCD, MRK, PFE, ALO, PYX, HME, WTR, SNH, SRZ, PG, CL, MO, RAI, CLX, NVO, BRK/A, FLO, DLM, PSQ, DOG, SSO, SH, BIL, IEI, TLT, TLH

There is more than enough bantering back and forth out there about the week’s sell-off in reaction to long-term interest rates and the Bill Gross predictions for potentially higher rates longer-term.  So, if you are a super-bull then you’d want to use the leadership stocks to pile surplus cash into thinking the world didn’t really change.  If you are a chicken-bull (want to buy but not overly aggressive and still cautious) then you want to buy defensive stocks.  If you’re a bear, well at least you get the 5% interest.  We wanted to provide at least a partial list of the bull and bear go-to picks ahead of the weekend when many will be doing extra amounts of reading.

Aggressive Bullish Picks

IF this was just an unwarranted sell-off that came because of a rate spook and if Mr. Gross is wrong, then you go hard and fast into what has been working before.  Aerospace, Infrastructure, Metals & Mining, very selective Tech.  So out of selective tech the two most obvious names are Apple (AAPL) and either Google (GOOG) or Research-in-Motion (RIMM).  In Aerospace the go-to names are Boeing (BA) and United Tech (UTX).  In metals its Allegheny Tech (ATI), Rio Tinto (RTP), and Companhia Vale do Rio Doce ‘CVRD’ (RIO).  In infrastructure the go-to names are Fluor (FLR), Shaw Group (SGR).  This week Jim Cramer gave his New Four Horsemen of Technology and booted the old ones.

Defensive Stock Plays For Chicken-Bull

Because this sell-off is for a different reason, we have eliminated the power companies because of the tie being so geared toward higher rates.  We’ve also pulled out the debt collection companies because they ran so much after the last sub-prime scare.  Here was the first line of 20 defensive stocks back in February from the mini-Asian meltdown and here was the list of second-line defensive names.   This still leaves plenty of options, and we added in a few more.

First Line Defensive Stocks: Coca-Cola (KO), PepsiCo (PEP), Anheuser-Busch (BUD), ConAgra (CAG), Heinz (HNZ), Campbell Soup (CPB), Hormel (HRL), Kellogg (K), General Mills (GIS), Kraft (KFT), McDonalds (MCD), Merck (MRK), Pfizer (PFE), P & G (PG), Colgate-Polmolive (CL), Altria (MO), Reynolds American (RAI), and Clorox (CLX).

Second-Line Defensive Stocks:  Berkshire Hathaway (BRK/a), Flowers Foods (FLO), Del Monte Foods (DLM), Novo Nordisk (NVO), Alpharma (ALO), Playtex (PYX), Home Properties (HME), Aqua America (WTR), and Senior Housing (SNH), Sunrise Senior Living (SRZ).

The Bearish Trades

If you are still bearish or are completely bearish, then you’ve got Treasuries and all of the inverse ETF funds.  Some of the negative market ETF trades that move invesrely are the SHORT QQQ PROSHARES (PSQ), SHORT DOW30 PROSHARES (DOG), ULTRA S&P500 PROSHARES (SSO), SHORT S&P500 PROSHARES (SH), and more.  For short-term rate ETF’s you have the fairly new STREETTRACKS SERIES TRUST Lehman 1-3 MO T-BILL (BIL).  The more liquid interest rate ETF’s that actually trade are the iShares Lehman 20+ Year Treas Bond (TLT), iShares Lehman 10-20 Year Treas Bond (TLH), iShares Lehman 3-7 Year T-Note (IEI), and more.

As a reminder, defensive stocks still tend to get hit when the market gets so bad that they throw out the baby with the bath water, but they usually start to fall less and less and are usually the first stocks that traders commit money to at the turns.  Defensive doesn’t mean immune.  Also, all of these are merely part of a partial list and the list could have easily been 3-times the size.   

Jon C. Ogg
June 8, 2007

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

Posted on: June 8, 2007 – 2:14 pm in ETF, Economy, HI/LOW, Shareholder Issues, , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,