Festivus in July: Feats of Strength!
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Festivus, for all of you unfamiliar with ‘Seinfeld,' is the alternative non-commercial holiday to Christmas celebrated with the unadorned aluminum Festivus pole, “the Airing of Grievances” during the dinner of meatloaf or spaghetti and finished off with “Feats of Strength.” Feats of Strength signals the end of Festivus once the head of the household is wrestled to the ground. In honor of Festivus in July I am featuring stocks that have wrestled a competitor or adversary to the ground this year. It’s time to doff the shirts and yell the Festivus battle cry:
And in no particular order they are:
- Whole Foods Market, Inc (NASDAQ: WFM) is the winner over a bruised and bleeding Safeway, Inc. Whole Foods Market has had a 41.43% rise in stock price over 52 weeks and today Safeway hit a 52 week low after reporting earnings for a 23% loss in share price over one year. The grocery business has slim margins to begin with but Whole Foods has still managed to attract the most affluent and discriminating shoppers. If Supervalu’s demise is any indication, Safeway could go even lower despite its now 4.30% yield.
- Apple, Inc (NASDAQ: AAPL) has pummeled Research in Motion Limited to an unrecognizable pulp. What can you say about Apple in such an overmatched fight? Research in Motion seems too dazed and unable to execute despite changing CEO’s, layoffs, etc. It’s basically got a phone nobody wants anymore at any price point. And Apple is on the move up again before its July 24 earnings release.
- Macys’s, Inc is up 16.27% over a year vs. competitor J.C. Penney Company, Inc (NYSE: JCP) which is down by 37.82%. JC Penney has recently crawled up off their 52 week floor with news of Pershing Square Capital Management’s famed Bill Ackman buying a piece and expecting to make 20 times his investment. Still, Macy’s has outperformed by offering the most desirable brands as well as localizing the products offered to their individual stores.
- Ulta Salon, Cosmetics & Fragrance, Inc (NASDAQ: ULTA). In this catfight, Ulta is up 39.93% over one year against the dismal Avon Products Inc down 43.88%. Avon now has over a 5% yield but Ulta just has the better business with the range of trendy cosmetics younger women want. The direct marketing model may be dead in developed countries as the close social relationships women used to have with neighbors are falling by the wayside.
- The Lions Gate Entertainment Corporation While Lions Gate didn’t win over a competitor it instead triumphed against activist investor Carl Icahn who finally sold all his shares to leave a double on the table before the huge run up to “The Hunger Games.” Lions Gate is still up 107.36% after drifting down from its 52 week high of $16.19. The company reports August 7.
- The Home Depot, Inc This was a pretty fair fight with both up over the last year but Home Depot up 38.64% over Lowe’s Companies, Inc. 11.86% improvement. Home Depot has had an aggressive advertising campaign, More Saving. More Doing, all over TV and the web and it seems to be working for them. Both are benefiting from weather trades in generators as well as the trend to stay and fix up the home rather than moving up and out. Home Depot has a 19.20 trailing P/E and Lowe’s a 17.14 trailing P/E. Lowe’s yield is 2.50% and Home Depot’s 2.30%.
- Starbucks Corporation is up 32% over the last year triumphing against Green Mountain Coffee Roasters, Inc down over 80.68% from its 52 week high. Ouch! While most of Green Mountain’s wounds seem to be self-inflicted it didn’t help that Starbucks said it is planning to come out with its own machine a la the Keurig. Shares short of the GMCR float are still a high 23.70% even at this low of $17.74 as short sellers see more pain for Green Mountain.
- Wal-Mart Stores Inc is up an amazing 33.74% over the year for a stock that had been viewed as dead money for so long. Most investors viewed it solely as a dividend play but even the Mexican Foreign Corrupt Practices Act scandal couldn’t keep it down. Its competitors Target and Costco are flirting with 52 week highs so they aren’t the losers. The loser here is Mr. Market which didn’t believe Wal-Mart could ever move again.
- Church & Dwight Co Inc: For a consumer staple name like Church & Dwight to be up 36.96% over a year is just a sign that buying American companies with yield is not going away except in the case of Procter & Gamble Co which is only up .51% over a year and most of that is probably due to Bill Ackman declaring he is buying into Procter and Gamble this week. Procter & Gamble now has a 3.40% yield but many don’t think Mr. Ackman’s purchase or activism will turn around the company any time soon.
- Under Armour, Inc (NYSE: UA): This was another close one but underdog Under Armour is up 22.95% over 52 weeks showing strength against former powerhouse Nike Inc which is only up 3.04% in the same period. I personally was surprised by this one until I read about Nike’s concerns about China. Also Under Armour has really been coming from behind with its shoes and the performance gear has been simplified into three lines: hot, cold and just right (no, I’m kidding) the lines are called heat, cold and all season gear.
Now that the Feats of Strength are over and the Festivus meatloaf is digesting, it’s time to bid you a Happy Festivus in July! Don’t trip over the Festivus pole on your way out or the bruised and broken bodies of our worst Festivus losers.
Note: You may wish to read my companion piece Festivus in July:The Airing of Grievances about those companies whose shareholders have the most right to yell to management like Mr. Costanza, “I have a problem with you people!” Many of these losers are there as well.
leglamp has no positions in the stocks mentioned above. The Motley Fool owns shares of Apple, Under Armour, and Whole Foods Market. Motley Fool newsletter services recommend Apple, Ulta Salon, Cosmetics & Fragrance, Under Armour, and Whole Foods Market. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.If you have questions about this post or the Fool’s blog network, click here for information.