A humorous look at the companies that caught our eye, for better or worse, this week
Shake Shack - DOG
McDonald’s, Wendy’s, Burger King, Five Guys, Shake Shack – can you say burger bubble? Helped by Wall Street’s hype machine, Shake Shack’s stock has posted sizzling gains since the New York burger chain went public in January at $21 a share. Now, as the shares tumble, investors are getting a taste of reality. Gee, it wouldn’t have anything to do with the stock’s multiple of about 1,000 times estimated 2015 earnings, would it?
SHAK-NYSE, Friday's close: $68.00 (U.S.), down $2.75 or 3.9% over week
Whole Foods Market - DOG
Whole Foods investors just lost a whole lot of money. Hurt by growing competition as mainstream grocers and mass merchants such as Wal-Mart stock more organic products, Whole Foods’ same-store sales rose just 3.6 per cent in its second quarter – less than the 5.3-per-cent gain analysts were expecting. Plans to open smaller stores offering “value prices” – value prices? at Whole Foods? – didn’t help investors’ appetites.
WFM-Nasdaq, Friday's close: $68.00 (U.S.), down $2.75 or 3.9% over week
Linamar - STAR
Business quiz! Which of the following products does Linamar NOT make?
a) vehicle engine and transmission components;
b) agricultural harvesting equipment;
c) aerial work platforms;
d) bicycle handlebar streamers.
Answer: d.
Despite that glaring gap in its product lineup, the company is still doing pretty darn well: With sales and earnings rising to new highs on organic growth and acquisitions, the stock took a ride on a scissor lift.
LNR-TSX, Friday's close: $82.32, up $10.61 or 14.8% over week
Manitoba Telecom - STAR
Given all the grim news at Manitoba Telecom – such as a 24-per-cent dividend cut and 500 layoffs at Allstream – you might think investors would be upset. Nope. Judging by the stock price, they’re happy. But maybe not as happy as members of the pension plan, which received a $120-million injection that aims to eliminate solvency payments through “2017 and beyond based on consensus bank forecasts for long-term interest rates.”
MBT-TSX, Friday's close: $26.37, up 43¢ or 1.7% over week
Keurig Green Mountain - DOG
And the award for the most hated new product goes to … Keurig Green Mountain, for its Keurig 2.0 system that will no longer accept coffee pods that aren’t made specifically for the new machine. With angry consumer reviews pouring in and the company slashing its full-year guidance after sales of brewers and accessories tumbled 23 per cent in the second quarter, the stock’s caffeine buzz is quickly wearing off.
GMCR-Nasdaq, Friday's close: $101.49 (U.S.), down $14.74 or 12.7% over week