24/7 Wall St. » CMG

11 Major Earnings Previews For Wednesday (AET, ALL, AOL, BMC, CMO, CMG, GMCR, JDSU, LVS, NDAQ, QCOM)

Administrator — Tue, 31 Jan 2012 17:45:34 +0000

Earnings season is still going strong and Wednesday will have many big earnings reports to watch. These are not the only earnings reports coming from big companies, but these are the ones we will be watching closely: Aetna Inc. (NYSE: AET); The Allstate Corporation (NYSE: ALL); AOL Inc. (NYSE: AOL); BMC Software Inc. (NASDAQ: BMC); Capstead Mortgage Corp. (NYSE: CMO); Chipotle Mexican Grill Inc. (NYSE: CMG); Green Mountain Coffee Roasters Inc. (NASDAQ: GMCR); JDS Uniphase Corporation (NASDAQ: JDSU); Las Vegas Sands Corporation (NYSE: LVS); NASDAQ OMX Group Inc. (NASDAQ: NDAQ); and QUALCOMM Inc. (NASDAQ: QCOM).

We have provided estimates from Thomson Reuters on each and offered commentary and guidance on some of these companies. More detailed previews will be available Tuesday morning for the reports due after the closing bell:

Aetna Inc. (NYSE: AET) estimates are $0.98 EPS and $8.49 billion. Watch the medical loss ratio here as it seems to be in quarters past that insurance outfits have been making more money than they were supposed to be making once the new healthcare laws go into effect. With shares around $44, the year high is $46.01.

The Allstate Corporation (NYSE: ALL) will prove if it has everyone in good hands or not. Thomson Reuters has estimates of $0.97 EPS. With shares around $29, its 52-week range is $22.27 to $34.40.

AOL Inc. (NYSE: AOL) has now seen shares bounce 60% off of the bottom and that is despite the recent news that Facebook is taking much of the new advertising market share. Estimates are $0.16 EPS per Thomson Reuters data but we just saw $0.28 noted in a Dow Jones preview yesterday. That being said, we are staying out of this one.

BMC Software Inc. (NASDAQ: BMC) is expected to post $0.82 EPS on almost $556 million in sales.

Capstead Mortgage Corp. (NYSE: CMO) is not a market moving stock, but investors who are into the world of high-yielding mortgage REITs will be watching. The estimate is $0.41 EPS (actually FFO) and the next dividend will be likely dependent upon that report. Its dividend yield screens north of 13% today.

Chipotle Mexican Grill Inc. (NYSE: CMG) is a cult stock if there every was one and now its valuation is close to $11.5 billion and the stock is within 2% of its all-time high. Thomson Reuters has a consensus of $1.83 EPS and $591.1 million in sales. For 2012, the estimates are $8.68 EPS and 2.7 billion in revenues.

Green Mountain Coffee Roasters Inc. (NASDAQ: GMCR) is another huge cult stock down on its luck from recent highs. The stock is still down by more than half. Thomson Reuters has estimate at $0.36 EPS and $1.06 billion in sales.

JDS Uniphase Corporation (NASDAQ: JDSU) still has a huge shareholder base that got buried in the first big tech bubble. At $12.75, the 52-week range is $8.59 to $29.12. Thomson Reuters has a consensus of $0.10 EPS and $390.9 million.

Las Vegas Sands Corporation (NYSE: LVS) is also within striking distance of a near-term high as shares are currently around $49.00 against a 52-week range of $36.05 to $50.68. The consensus estimates from Thomson Reuters are $0.57 EPS and $2.46 billion in sales.

NASDAQ OMX Group Inc. (NASDAQ: NDAQ) is a value stock when it comes to the exchanges and it is not supposedly trying to do any crazy merger right now. At $25.00 the 52-week range is $20.32 to $29.71. The consensus estimate is $0.62 EPS and $417.8 million.

QUALCOMM Inc. (NASDAQ: QCOM)is within striking distance of its yearly high as shares are around $58.80 and the 52-week range is $45.98 to $59.84. Thomson Reuters has estimates of $0.90 EPS on $4.57 billion in revenues. Next quarter estimates are $0.89 EPS and $4.49 billion in sales. Keep in mind that if it rallies much more than the current $98.8 billion market cap will be $100 billion.

JON C. OGG

Filed under: 24/7 Wall St. Wire, Calendar, Earnings Tagged: AET, ALL, AOL, BMC, CMG, CMO, GMCR, JDSU, LVS, NDAQ, QCOM

The Best Performing S&P Stocks of 2011 (SPY, OKE, AN, ROST, LTD, GR, TSO, EQT, ERTS, WFM, RL, TDC, RRC, MA, HUM, CMG, VFC, ISRG, BIIB, EP, COG)

Administrator — Tue, 01 Nov 2011 16:08:23 +0000

October may have been one of the best months of many of our lives in equities. The SPDR S&P 500 (NYSE: SPY) rose by 10.9%. in October, but the year-to-date gain has been a mere 1.2% from the December 31, 2010 close to the close on October 31, 2011. 24/7 Wall St. wanted to see which stocks are up the most in percentage gains so far in 2011 in data provided by Capital IQ. This is a year-to-date move through the close of October 31, 2011. We have shown the S&P 500 Index gainers in order from lowest to highest. Another representation is how much implied upside there is to the Thomson Reuters consensus analyst price target as well. Those which are trading above their consensus price target have been given a “caution” ahead of the pricing data.

ONEOK Inc. (NYSE: OKE) 37.1% year-to-date; at $76.05 the consensus price target is $76.60.

AutoNation Inc. (NYSE: AN) 38.1% year-to-date; caution: at $38.94 the consensus price target is $31.28.

Ross Stores Inc. (NASDAQ: ROST) 38.7% year-to-date; caution: at $87.73 the consensus price target is $85.00.

Limited Brands, Inc. (NYSE: LTD) 39.0% year-to-date; at $42.71 the consensus price target is $44.71.

Goodrich Corporation (NYSE: GR) 39.2% year-to-date; This is being acquired, so no color.

Tesoro Corporation (NYSE:TSO) 39.9% year-to-date; at $25.94 the consensus price target is $20.31.

EQT Corporation (NYSE:EQT) 41.6% year-to-date; at $63.50 the consensus price target is $72.28.

Electronic Arts Inc. (NASDAQ: ERTS) 42.6% year-to-date; at $23.35 the consensus price target is $25.63. This was previously listed as our top pick for the best video game stock for 2011.

Whole Foods Market, Inc. (NASDAQ: WFM) 42.6% year-to-date; at $72.12 the consensus price target is $74.47.

Ralph Lauren Corporation (NYSE: RL) 43.2% year-to-date; caution: at $158.79 the consensus price target is $150.00.

Teradata Corporation (NYSE: TDC) 44.9% year-to-date; at $59.66 the consensus price target is $60.56.

Range Resources Corporation (NYSE: RRC) 53.0% year-to-date; at $68.84 the consensus price target is $76.50.

Mastercard Incorporated (NYSE: MA) 54.9% year-to-date; at $347.24 the consensus price target is $374.82. It seems odd to see one financial stock here.

Humana Inc. (NYSE: HUM) 55.1% year-to-date; at $84.89 the consensus price target is $88.71. Health insurance has not been as bad of a business as the administration was looking for.

Chipotle Mexican Grill, Inc. (NYSE: CMG) 58.1% year-to-date; caution: at $336.12 the consensus price target is $328.45. The growth continues, but it is at or close to being fully valued.

V.F. Corporation (NYSE: VFC) 60.4% year-to-date; at $138.22 the consensus price target is $144.33.

Intuitive Surgical, Inc. (NASDAQ: ISRG) 68.3% year-to-date; caution: at $433.86 the consensus price target is $419.27. DaVinci sales remain robust as more surgeons are looking for robotic surgery capabilities.

Biogen Idec Inc. (NASDAQ: BIIB) 73.5% year-to-date; caution: at $116.36 the consensus priced target is $115.22. Here is how this compared to the rest of its peers before earnings season.

El Paso Corp. (NYSE: EP) 81.8% year-to-date; being acquired so no color.

Cabot Oil & Gas Corporation (NYSE: COG) 105.3% year-to-date; ; at $77.72 the consensus price target is $91.32.

JON C. OGG

Filed under: HI/LOW, Index, Trading Alert Tagged: AN, BIIB, CMG, COG, EP, EQT, ERTS, GR, HUM, ISRG, LTD, MA, OKE, RL, ROST, RRC, SPY, TDC, TSO, VFC, WFM

24/7 Closing Bell (BP, DRYS, STX, PETM, BHP, F, MCD, GE, CMG, FSL, APKT, CALX, GMCR, PCYO, SYNA, RCON)

Paul Ausick — Fri, 21 Oct 2011 20:27:58 +0000

A raft of good earnings reports pushed the markets higher at opening this morning, sending the Dow Industrials up about 200 points at mid-day. For some reason traders are hopeful that this weekend’s meeting between the leaders of France and Germany will lead to a resolution of the banking crisis in Europe. Equities also got a boost from a Federal Reserve governor who said that the Fed should try to push mortgage rates even lower with large-scale purchases of mortgage-backed securities. President Obama announced that nearly all US troops would be out of Iraq by the end of this year, giving the markets another late afternoon boost.The unofficial closing bells put the DJIA up more than 267 points to 11,808.87 (2.31%), the NASDAQ rose nearly 39 points (1.49%) to 2,637.46, and the S&P 500 rose 1.88% or nearly 23 points to 1,238.23.There were several analyst upgrades and downgrades today, including a ‘neutral’ start for BP plc (NYSE: BP) at Nomura. DryShips, Inc. (NASDAQ: DRYS) was started as ‘equal-weight’ at Barclays, and disk drive maker Seagate Technology LLC (NYSE: STX) was raised to ‘outperform’ at Baird and to ‘buy’ at ThinkEquity. Wells Fargo cut PetSmart Inc. (NASDAQ: PETM) to ‘market perform’. Mining giant BHP Billiton plc (NYSE: BHP) was cut to ‘hold’ at SocGen and to ‘neutral’ at HSBC. Ford Motor Co. (NYSE: F) received a debt upgrade to ‘BB+’ from S&P, which could mean that a dividend is on its way from the automaker.

Here are today’s big post-earnings news reactions with prices during the last half-hour of trading: McDonald’s Corp. (NYSE: MCD) is up almost 3.5% at $92.09, after hitting new 52-week high of $92.12 earlier in the day; General Electric Co. (NYSE: GE) is down about -2.2%, at $16.26; Chipotle Mexican Grill, Inc. (NYSE: CMG) is up 7.25%, at $331.00; Freescale Semiconductor Holdings Ltd. (NYSE: FSL) is down about -2% at $11.89; Acme Packet, Inc. (NASDAQ: APKT) fell more than -20% and is trading at $30.37; and Calix Inc. (NYSE: CALX) is down nearly -19% at $6.82, after posting a new 52-week low earlier today of $6.39.

Several other standouts from today include …

Green Mountain Coffee Roasters, Inc. (NASDAQ: GMCR) began the day up about 5% following some harsh words from David Einhorn. The stock is finishing the day up about 1.5%, at $69.01, after dropping nearly -30% since the beginning of the week.

Pure Cycle Corp. (NASDAQ: PCYO) is up more than 27%, to $2.37, after several down trading sessions.

Synaptics Inc. (NASDAQ: SYNA) is up more than 19%, to $32.18, after posting a new 52-week high earlier today. The company has nearly completed its transition to a maker of chips for touchscreens, a much higher margin business than its touchpad chips.

Recon Technology Ltd. (NASDAQ: RCON) is down more than -5%, at $0.97, after getting a letter from Nasdaq for failing to file an annual report.

Stay tuned for Monday. We have the National Activity Index from the Chicago Federal Reserve Bank at 8:30 a.m. and a speech from Dallas Fed chief Richard Fisher at 9:00 a.m. The US Treasury has also scheduled three short-term T-bill auctions for late morning.

Paul Ausick

Filed under: General, Shareholder Issues Tagged: APKT, BHP, BP, CALX, CMG, DRYS, F, FSL, GE, GMCR, MCD, PCYO, PETM, RCON, STX, SYNA

Top 9 Earnings Previews for the Rest of the Week (T, MSFT, GE, HON, MCD, VZ, COF, CMG, PM)

Administrator — Wed, 19 Oct 2011 19:28:25 +0000

We have already seen waves and waves of earnings reports this week, yet we have many more Dow Jones Industrial Average companies reporting earnings and several other key companies that investors and traders will be watching on Thursday and Friday.

We have detailed previews for the following companies: AT&T Inc. (NYSE: T); Microsoft Corporation (NASDAQ: MSFT); Capital One Financial Corporation (NYSE: COF); Chipotle Mexican Grill Inc. (NYSE: CMG); Philip Morris International Inc. (NYSE: PM); General Electric Co. (NYSE: GE); Honeywell International (NYSE: HON); McDonald’s Corporation (NYSE: MCD); and Verizon Communications Inc. (NYSE: VZ).

Consensus estimates and the consensus analyst price targets have been compiled from Thomson Reuters.

Thursday, October 20

AT&T is due Thursday morning and Thomson Reuters has estimates for the DJIA component of $0.61 EPS and $31.62 billion in revenues; next quarter estimates are $0.58 EPS and $31.72 billion in revenue. Shares are trading around $29.15, its 52-week trading range is $27.20 to $31.94 and analysts have a consensus price target of $32.33. With the current bias being against approval of the T-Mobile operations, we will be looking for guidance on that front. Other than that, investors have close to a 6% dividend yield.

Microsoft is due Thursday afternoon and Thomson Reuters has estimates for the DJIA component of $0.68 EPS and $17.25 billion in revenues; next quarter estimates are $0.84 EPS and $21.21 billion in revenue. Shares are trading around $27.15, its 52-week trading range is $23.65 to $29.46 and analysts have a consensus price target of $31.90. The dividend is now close to 3% but investors are still concerned about the PC market causing a slower upgrade cycle for Windows. The only hope is now that Intel offered enough of a PC-market buffer.

Some smaller large company reports to watch on Thursday are as follows:

Capital One Financial shares hit a 5-day low on Wednesday on worries of slower payments on credit cards in September and estimates are $1.68 EPS on $4.05 billion in sales. Keep in mind that it has been making acquisitions and that may alter the future of the company.

Chipotle Mexican Grill has been such a high flying stock that many traders are watching it as “the Apple of fast food.” Estimates are $1.85 EPS and $583.1 million, for the next quarter the estimates are $1.85 EPS and $584.45 million in sales.

Filed under: Calendar, Earnings, Economy Tagged: CMG, COF, GE, HON, MCD, MSFT, PM, T, VZ

Top Analyst Upgrades & Downgrades (CVX, CMG, COST, DE, XOM, DFS, LEAP, NWS.A, NEM, ORCL, RL, PLCM, PCG, RYAAY, SNE, WAG)

Administrator — Thu, 06 Oct 2011 12:23:05 +0000

These are some of this Thursday’s top analyst upgrades, downgrades, and initiations seen having an impact from Wall Street research calls.

Chevron Corporation (NYSE: CVX) Cut to Underweight at JPMorgan.
Chipotle Mexican Grill, Inc. (NYSE: CMG) Cut to Market Perform at William Blair.
Costco Wholesale Corporation (NASDAQ: COST) Cut to Market Perform at William Blair; Reiterated Outperform at Credit Suisse; Raised target to $90 at Argus.
Deere & Co. (NYSE: DE) Maintained Neutral but cut estimates and target to $87 at Credit Suisse.
Exxon Mobil Corporation (NYSE: XOM) Cut to Underweight at JPMorgan.
Discover Financial Services (NYSE: DFS) named Bull of the Day at Zacks.
Leap Wireless International Inc. (NASDAQ: LEAP) maintained Neutral but target to $4 from $10 at Credit Suisse.
News Corporation (NASDAQ: NWS.A) Removed from the Conviction Buy List at Goldman Sachs.
Newmont Mining Corporation (NYSE: NEM) named Value stock of the day at Zacks.
Oracle Corporation (NASDAQ: ORCL) Reiterated Outperform on Focus List at Credit Suisse.
Polo Ralph Lauren Corp. (NYSE: RL) Raised to Buy at Citigroup.
Polycom Inc. (NASDAQ: PLCM) Raised to Buy at Argus.
PG&E Corporation (NYSE: PCG) Raised to Buy at Citigroup.
Ryanair Holdings plc (NASDAQ: RYAAY) Raised to Outperform at Credit Suisse.
Sony Corporation (NYSE: SNE) Cut to UNderperform at BofA/ML.
Walgreen Co. (NYSE: WAG) Cut to Neutral at BofA/ML.

JON C. OGG

Filed under: Analyst Calls Tagged: CMG, COST, CVX, DE, DFS, LEAP, NEM, NWS-A, ORCL, PCG, PLCM, RL, RYAAY, SNE, WAG, XOM

Can Yum! Buck the Downtrend in Casual Dining? (YUM, DRI, MCD, SBUX, CMG)

Administrator — Tue, 04 Oct 2011 15:18:00 +0000

After the markets close today, Yum! Brands (NYSE: YUM) will report its third-quarter earnings. Analysts are expecting EPS of $0.83 on revenue of $3.1 billion, compared with second-quarter EPS of $0.63 on revenue of $2.82 billion. Big things are expected from Yum!, which gets more than 40% of its revenues from its China operations. But will China be enough following last week’s disappointing report from Darden Restaurants (NYSE: DRI) brought the whole casual dining sector down?

Darden, which owns and operates Olive Garden and Red Lobster stores among others, went ex-dividend today on its $0.43 quarterly dividend payable on November 1st. The company’s dividend yield is now about 4.18%. A more direct competitor to Yum! is McDonald’s (NYSE: MCD), which has been trying to step up its presence in China, as has Starbucks (NASDAQ: SBUX). Another tack is that taken by Chipotle Mexican Grill (NYSE: CMG), which is opening a new chain of Asian food stores.

McDonald’s faltering same-store sales are particularly a surprise in Asia, where August sales fell -0.3% compared with an expected rise of 3.5%. What has been working for the Golden Arches in the U.S. — introductions of higher margin drinks and other products — apparently has not translated well into Chinese.

Yum! — which operates KFC, Taco Bell and Pizza Hut — is expected to see Chinese same-store sales growth of 12% in the third quarter. U.S. same-store sales are expected to fall -3%, and analysts are concerned that sales in China will get softer as economic growth cools. The big question for Yum! is whether or not China’s consumers are still willing to line up for fried chicken, tacos and pizza. The company is betting heavily that they will, as expansion plans call for roughly five times as many stores in China over the next several years.

Starbucks has its eye on China as well, looking to more than double its complement of about 750 stores in the country over the next several years. The issue Starbucks must overcome is different from either Yum! or McDonald’s, which appeal to a family crowd in the bigger cities. The Starbucks consumer in China needs to have a little extra cash to spend for the company’s higher-priced coffee drinks, and the number of Chinese consumers who meet that requirement is relatively small. Plus, many will be those same customers for burgers and pizza with the family.

Chipotle’s new ShopHouse Southeast Asian Kitchen stores are targeted to attract the same customers as its popular Mexican food stores. These are the value-conscious consumers and there are sure to be more of them as the U.S. economy continues in the doldrums. This approach may gain traction because Asian food has yet to blanket the U.S. in the same way that burgers, fried chicken and pizza do.

When Yum! reports earnings today, an important number to look at will be their sales in emerging nations other than China. If that number is light, and U.S. sales are soft, Yum! may have a tough time convincing investors that China is the answer to their prayers.

Yum’s shares are down about -0.5% in the first 90 minutes of trading this morning, at $48.23, in a 52-week range of $46.09 – $57.75. McDonald’s shares are off more than -2%, at $84.15, in a 52-week range of $72.14 – $91.22. Starbucks shares are down about -0.2%, at $36.14, in a 52-week range of $25.37 – $42.00. Chipotle’s shares are up about 0.1%, at $293,01, in a 52-week range of $171.24 – $346.78.

Paul Ausick

Filed under: Earnings, Food, Retail Tagged: CMG, DRI, MCD, SBUX, YUM

Top Analyst Upgrades & Downgrades (AGU, AEM, AXP, AMR, BHP, COF, CMG, SNP, CEO, JNY, ERIC, PTR, RVBD, SODA, SON, SWC, WRB)

Administrator — Tue, 04 Oct 2011 12:27:47 +0000

These are some of this Tuesday’s top analyst upgrades, downgrades, and initiations seen having an impact from Wall Street research calls. Despite the weakness, there are still upgrades taking place.

Agrium, Inc. (NYSE: AGU) named Bull of the Day at Zacks.
Agnico-Eagle Mines Ltd. (NYSE: AEM) Raised to Outperform at Credit Suisse.
American Express Company (NYSE: AXP) Cut to Hold at Jefferies.
AMR Corporation (NYSE: AMR) Raised to Outperform at Rodman & Renshaw.
BHP Billiton (NYSE: BHP) Raised to Outperform at Credit Suisse.
Capital One Financial Corp. (NYSE: COF) Cut to Hold at Jefferies.
Chipotle Mexican Grill Inc. (NYSE: CMG) Started as Outperform with $370 target at Credit Suisse.
China Petroleum & Chemical Corp. (NYSE: SNP) Started as Neutral at Credit Suisse.
CNOOC Ltd. (NYSE: CEO) Started as Outperform at Credit Suisse.
The Jones Group Inc. (NYSE: JNY) Value stock of the day at Zacks.
LM Ericsson Telephone Co. (NASDAQ: ERIC) Raised to Buy at Citigroup.
PetroChina Co. Ltd. (NYSE: PTR) Started as Neutral at Credit Suisse.
Riverbed Technology, Inc. (NASDAQ: RVBD) Cut to Equal-Weight at Barclays.
SodaStream International Ltd. (NASDAQ: SODA) Raised to Buy at Deutsche Bank.
Sonoco Products Co. (NYSE: SON) Cut to Hold at Argus.
Stillwater Mining Company (NYSE: SWC) Removed from Focus List ar Credit Suisse.
W.R. Berkley Corp. (NYSE: WRB) named Bear of the Day at Zacks.

JON C. OGG

Filed under: Analyst Calls Tagged: AEM, AGU, AMR, AXP, BHP, CEO, CMG, COF, ERIC, JNY, PTR, RVBD, SNP, SODA, SON, SWC, WRB

The Largest S&P 500 Stock Gainers For The First Three Quarters

247wallst — Sat, 01 Oct 2011 11:34:37 +0000

S&P 500 YTD TOP 10 (31Dec10 – 29Sep11)	Ticker	YTD Price Change (%)	Close Price 29Sep11	Close Price 31Dec10	Market Cap($Mil)	Short Interest as % of Shares
Cabot Oil & Gas Corp	COG	69.4	64.13	37.85	6700.9	0.40%
Cerner Corp	CERN	48.8	70.49	47.37	11916.5	9.50%
Chipotle Mexican Grill Inc	CMG	47.2	313.14	212.66	9815.7	8.70%
MasterCard Inc	MA	46.5	328.37	224.11	39630.3	1.20%
V.F. Corp	VFC	45.7	125.56	86.18	13775.7	3.00%
Intuitive Surgical Inc	ISRG	44.8	373.22	257.75	14586.6	3.50%
Biogen Idec Inc	BIIB	40.9	94.46	67.05	22910.9	0.30%
Goodrich Corp	GR	37.5	121.08	88.07	15135.6	1.10%
Watson Pharmaceuticals Inc.	WPI	37.3	70.91	51.65	9511.1	2.10%
Humana Inc.	HUM	37.1	75.07	54.74	12523.9	0.50%
Source: S&P Capital IQ

Filed under: Research Tagged: BIIB, CERN, CMG, COG, GR, HUM, ISRG, MA, VFC, WPI

Chipotle Going Asian (CMG, PFCB, MCD)

Administrator — Thu, 15 Sep 2011 14:38:44 +0000

Chipotle Mexican Grill Inc. (NYSE: CMG) opens its first Asian-themed store today, called ShopHouse Southeast Asian Kitchen, in a move calculated to take advantage of consumer demand for limited-service Asian food. Sales of Asian food grew at nearly a 6% rate in 2010, and are expected to grow by another 5% this year, making the Asian restaurants the fastest growing segment of the limited-service market.

While not a crowded field, there is certainly competition. P.F. Chang’s China Bistro, Inc. (NASDAQ: PFCB) owns and operates 168 Pei Wei stores in the same space and another 200 or so of its namesake stores. Privately-held Panda Restaurant Group, Inc. operates more than 1,300 mall-based Panda Express stores and Carlson Restaurants Worldwide, Inc., another privately-held firm, operates more than 90 Pick Up Stix stores in the US southwest.

Chipotle shares have gained more than 80% in the past 12 months, while P.F. Chang’s shares have fallen by around -40%. The pricier Chang’s has stalled as customers have voted with their feet, staying away from higher priced casual dining in favor of lower cost stores like Chipotle.

But even low-priced stores are having their troubles. McDonald’s Corp. (NYSE: MCD), which had been growing nicely for several quarters, had a downturn in its August sales. That is not a positive signal for a new lower-priced option like Chipotle’s new ShopHouse brand, and Chipotle originally came from McDonald’s.

And brand is another problem. Building a solid new brand is not easy or cheap in the best economic times — and the US economy is not anywhere near its best right now. Chipotle also faces the problem of essentially being unable to leverage its solid position in Mexican food eateries in a completely different style of cooking. The situation resembles what you might think if your favorite local Mexican restaurant suddenly began serving Thai food. The usual reaction is to ask what the heck the store knows about making Thai food. To avoid that reaction costs a lot and if Chipotle puts enough money behind the ShopHouse stores, the company might come up with a winner.

Chipotle’s revenue grew 22% in its most recent quarter. If the company can keep that up, there’s no reason to think that the ShopHouse stores won’t be successful. But that’s a pretty big ‘if’ as the economic data keeps slowing.

Shares in Chipotle are up about 0.5% today, at $317.40, in a 52-week range of $164.26-$337.32. P.F. Chang’s shares are up more than 1%, at $29.16, in a 52-week range of $27.50-$53.39.

Paul Ausick

Filed under: Food, Retail Tagged: CMG, MCD, PFCB

Top Analyst Upgrades & Downgrades (AER, AYR, BBY, BBT, CMG, CREE, HPQ, JDSU, LDK, LOGI, LULU, RIMM, SHLD, SINA, SU, TSO, VRSK)

Administrator — Fri, 19 Aug 2011 12:24:27 +0000

These are some of the top analyst upgrades, downgrades, and initiations seen from Wall Street research calls this Friday morning.

AerCap Holdings N.V. (NYSE: AER) Started as Outperform with $16 target at Credit Suisse.
AirCastle LTD (NYSE: AYR) Started as Neutral with $14 target at Credit Suisse.
Best Buy Co., Inc. (NYSE: BBY) Raised to BUy at S&P Equity Research (late Thursday).
BB&T Corporation (NYSE: BBT) Started as Hold at Citigroup.
Chipotle Mexican Grill, Inc. (NYSE: CMG) Raised to Outperform at Morgan Keegan.
Cree Inc. (NASDAQ: CREE) Cut to Market Perform at JMP.
Hewlett-Packard Co. (NYSE: HPQ) Cut to Neutral at UBS; Cut to Neutral at Baird.
JDS Uniphase Corporation (NASDAQ: JDSU) Maintained Buy but cut target to $17 at Argus.
LDK Solar Co., Ltd. (NYSE: LDK) cut to Neutral at Piper Jaffray.
Logitech International (NASDAQ: LOGI) Cut to Underperform as Bear of the Day at Zacks.
Lululemon Athletica Inc. (NASDAQ: LULU) Raised to Equal-Weight at Barclays.
Research in Motion Ltd. (NASDAQ: RIMM) Raised to Hold from Underperform at Jefferies.
Sears Holdings Corp. (NASDAQ: SHLD) Maintained Hold at Argus.
Sina Corporation (NASDAQ: SINA) Cut to Neutral at Credit Suisse.
Suncor Energy INc. (NYSE: SU) Raised to Buy at BofA/ML.
Tesoro Corporation (NYSE: TSO) Maintained Outperform as Bull of the Day at Zacks.
Verisk Analytics, Inc. (NASDAQ: VRSK) Raised to Outperform at KBW.

You are invited to join our free daily email distribution list to hear more about analyst upgrades and downgrades, top day trader and active trader alerts, dividend trends, news on Buffett and other investment gurus, IPOs, secondary offerings, private equity, and more.

JON C. OGG

Filed under: Analyst Calls Tagged: AER, AYR, BBT, BBY, CMG, CREE, HPQ, JDSU, LDK, LOGI, LULU, RIMM, SHLD, SINA, SU, TSO, VRSK