4 Stocks that Dodged Monday's Decline
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Stocks took a tumble in the US on Monday with the world coming to an end. Experts say Greece is looking worse, Soros thinks the EU is doing the bailout all wrong, and US housing cannot seem to get solid footing. The DJIA decreased 138 points (-1.09%) and the VIX spiked 12%. However, some stocks defied the downward pressures of the market and moved upward.
Lee Enterprises (NYSE: LEE) has recently been on cloud 9 after it found the man of its dreams: Mr. Buffett. It was disclosed on June 5th that Buffett and Berkshire Hathaway (NYSE: BRK-B) took quite the stake in this boring little $80 million market value newspaper company. Since then it is up 24.3%. Berkshire has been known for making incredible newspaper investments in the past with holdings of the Washington Post and Buffalo News. Warren used to love the economics of the newspaper industry and apparently still doesn't mind it if the price is right. On Monday Lee was up 7.69% despite no real news...just the after-effects of a romance.
Supervalu's deals aren't just in the produce aisle. Almost 7 million Supervalu (NYSE: SVU) shares were bought yesterday and the stock surged 4.71%. Were there coupons in the Sunday paper? It has been a cash sucking machine the last 2 years with few prospects but, of course there are always rumors surrounding these potential turnarounds. It was up on Friday as well and has had very unusual trading volume. Could a grocery monster eat it up? Maybe a buyout firm?
Build-A-Bear Workshop (NYSE: BBW) has jumped over 10% in the last five trading days. Almost half of that climb came from Monday. How are the fluffy bears weathering the economic storms? Does the bear come with a red polka-dot umbrella? Well, kinda. The company insiders have been buying up the shares. One of the directors seems to love this stock. Braden Leonard picked up well over $1 million in BBW stock in that last few months alone. He now controls over 15% of the company. Build-A-Bear does have a low P/B ratio and about 50% of its market value in cash. Hmmm, maybe the insiders know something.
It also pays to have good friends. Shares of Constellation Brands (NYSE: STZ) shot up on Monday as their buddy, and beverage partner, Grupo Modelo announced they are likely to be closer to Anheuser-Busch InBev in the near future. Modelo is largely owned by AB InBev already (with a 50.4% stake) but it may see even more of its shares in the AB coffers soon. Constellation Brands has a joint venture with Modelo called Crown Imports and this venture imports beers into the US. There are rumors that Modelo will buy out Constellation's stake in the venture if AB buys out Modelo.
What do these guys have in common? Big Kahuanas are buying them up...or rumored to be buying them up...or have partners being bought up. Buffett, monster beer companies, insiders, and rumors are moving these stocks. So if you want to swim against the tide, ride on one of the big fishes.
mthiessen has no positions in the stocks mentioned above. The Motley Fool owns shares of Berkshire Hathaway and SUPERVALU INC. Motley Fool newsletter services recommend Berkshire Hathaway. 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.