Though considered by some to be a sinking ship and/or takeover target, office supply juggernaut Staples (NASDAQ: SPLS ) is pushing through its 52-week highs as the company reported respectable earnings during Thursday's trading. Realistically, revenue is growing, the balance sheet is very conservative, and management has taken solid steps in pushing Web-based sales and delivery, as well as international expansion. Still, the company faces headwinds in a devastatingly low-margin business that requires expansion outside of core office products. Should Staples be a part of your retail portfolio? Let's take a look at recent earnings to find out.
Earnings recap
For the first quarter of 2013, Staples brought in $5.8 billion in revenue -- a 3% discount to last year's number and roughly in line with analysts' estimates. On the bottom line, the company earned $0.36 per share, a miss of one penny from the Street's estimate and, again, slightly less than 2012's number.
One of the more exciting figures was the $306 million in free cash flow that the company generated. European same-store sales were also encouraging -- reaching a three-year high.
Best Small Cap Companies To Buy Right Now: Luna Innovations Incorporated(LUNA)
Luna Innovations Incorporated engages in the research, development, and commercialization of technologies in the areas of sensing and instrumentation products, and health care products primarily in the United States. The company?s Product and Licensing segment offers test and measurement products to monitor the integrity of fiber optic network and sub-assemblies. This segment provides Optical Vector Analyzer platform, a device for single-measurement, all-parameter analysis of fiber optic components and assemblies up to 150 meters in length; Optical Backscatter Reflectometer, a sensitive diagnostic device, for data and telecommunications companies, and service providers who maintain their own fiber optic networks; and Phoenix laser, a MEMs-based external cavity laser, that offers low noise and precise tuning capability over the C-band. It also offers distributed sensing systems, which comprise multiple sensors whose input is integrated through a fiber optic network and soft ware to detect distributed strain, shape, and temperature; and tunable lasers. In addition, this segment provides health care products, including medical devices for minimally invasive diagnostics, surgery, and therapy; non-invasive monitoring and diagnosis medical devices consisting of emboli detection and classification QUANTIFIER, a non-invasive medical device, that uses quantitative ultrasound technology to count emboli in ex-vivo blood circuit; and nanomaterial-based medical products comprising Trimetasphere nanomaterials. The company?s Technology Development segment provides contract research services to universities, government entities, and corporations. Luna Innovations Incorporated offers its services to energy, telecommunications, life sciences, and defense industries .The company was incorporated in 1990 and is headquartered in Roanoke, Virginia.
Advisors' Opinion:- [By John Udovich]
Yesterday, Luna Innovations Incorporated (NASDAQ: LUNA), a rather unusual and innovative small cap stock,�soared some 23.26%���meaning its worth taking a closer look at the stock along with its performance verses the performance of small cap benchmarks like the iShares Russell 2000 Index ETF (NYSEARCA: IWM), the�iShares Russell 2000 Value Index ETF (NYSEARCA: IWN) or the iShares Russell 2000 Growth Index ETF (NYSEARCA: IWO).
Hot Penny Companies To Watch For 2014: Westinghouse Solar Inc.(WEST)
Westinghouse Solar, Inc. engages in the design, manufacture, integration, and installation of solar power systems under the Westinghouse name. It offers its solar power systems for residential and commercial customers. The company also designs and distributes solar panels with integrated micro inverters (called as AC solar panels). The company sells its AC solar panels to solar installers, trade workers, and do-it-yourself customers through distribution partnerships, dealer network, and retail outlets. It has a strategic partnership with Real Goods Solar, whereby Real Goods Solar operates as an authorized dealer for westinghouse solar power systems for sale to its customers in California and Colorado markets. The company was formerly known as Akeena Solar, Inc. and changed its name to Westinghouse Solar, Inc. on Apr 14, 2011. Westinghouse Solar, Inc. was founded in 2001 and is headquartered in Campbell, California.
Advisors' Opinion:- [By John Udovich]
Small cap solar stock Andalay Solar Inc (OTCMKTS: WEST) has largely cratered for investors�verses solar stock peers Real Goods Solar, Inc (NASDAQ: RSOL) and SolarCity Corp (NASDAQ: SCTY), but is the company finally turning itself around after a failed deal to be acquired?
- [By Bryan Murphy]
My enthusiasm regarding Real Goods Solar, Inc. (NASDAQ:RSOL) and Westinghouse Solar Inc. (OTCMKTS:WEST) hasn't exactly been a veiled secret. Though I've favored one over the other at various times since the entire solar panel industry went back into high gear in the middle of the second quarter, I've been a fan of both RSOL as well as WEST for a while. The trick has been finding the right entry spot for both of these volatile stocks.
Hot Penny Companies To Watch For 2014: Telular Corporation(WRLS)
Telular Corporation designs, develops, and distributes products and services that utilize wireless networks to provide data and voice connectivity among people and machines primarily in the United States and internationally. It provides machine-to-machine and event monitoring services, including Telguard that comprises a specialized terminal unit, which interfaces with commercial security control panels and communicates with event processing servers to provide real-time transport of alarm signals from residential and commercial locations to an alarm company?s central monitoring station; and TankLink solution that combines a cellular communicator, wireless data services, and a Web-based application into a single offering, which allows end-users to monitor the product level in a given tank vessel. The company also offers fixed cellular terminals for voice, fax, and Internet access over the wireless networks. It sells its products to security equipment distributors, cellular carriers, and value added resellers. The company was founded in 1986 and is headquartered in Chicago, Illinois.
Advisors' Opinion:- [By Eric Volkman]
Telular (NASDAQ: WRLS ) will most likely soon be an asset belonging to another company. It has entered into an agreement to be bought by private equity firm Avista Capital Partners for total consideration of $253 million. This consists of $12.61 per share in cash and roughly $18.5 million in assumed debt.
Hot Penny Companies To Watch For 2014: Gamestop Corporation (GME)
GameStop Corp. operates as a retailer of video game products and personal computer (PC) entertainment software. It sells new and used video game hardware; video game software; used video game products; and video game accessories, which primarily consist of controllers, memory cards, and other add-ons, as well as strategy guides and trading cards. The company also offers PC entertainment and other software across various genres, including sports, action, strategy, adventure/role playing, and simulation, as well as products that relate to the digital category comprising network point cards, prepaid digital and online timecards, and digitally downloadable software. GameStop Corp. sells its products through stores, as well as through its electronic commerce Web sites, including gamestop.com, ebgames.com.au, gamestop.ca, gamestop.it, gamestop.es, gamestop.ie, gamestop.de, and micromania.fr. As of July 12, 2011, its retail network and family of brands included 6,573 company-oper ated stores in 17 countries worldwide. The company also publishes Game Informer, a video game magazine in the United States; and operates the online video gaming Web sites kongregate.com and joltonline.com. GameStop Corp. was founded in 1994 and is based in Grapevine, Texas.
Advisors' Opinion:- [By Rick Aristotle Munarriz]
Companies can make brilliant moves, but there are also times when things don't work out quite as planned. From a costly yet potentially lucrative acquisition by the world's largest search engine to a video game retailer wishing it had a cheat code for sales, here's a rundown of the week's best and worst in the business world. Tesla Motors (TSLA) -- Winner Tesla sells cool yet expensive electric cars, and business is starting to get charged up. Tesla revealed this week that it sold and delivered 6,900 cars during the fourth quarter, far more than it was originally targeting. Tesla had moved just 5,500 Model S sedans during the third quarter, with 1,000 of those going to Europe. That worried investors, because it pointed to the possibility of waning domestic demand for the plug-in speedsters. This encouraging announcement was enough to send the stock 16 percent higher on Tuesday. Tesla was one of last year's hottest stocks, and it's kicking off 2014 with the pedal to the metal. GameStop (GME) -- Loser Last quarter was supposed to be the video game industry's moment to shine. With the Xbox One and PS4 breathing new life into the console business, GameStop seemed to be sitting pretty and well-stocked with the systems that were in high demand this holiday season. Unfortunately, that wasn't enough. Hardware sales did nearly double at GameStop, but new software sales fell by a steeper than expected 22.5 percent. Owners of older systems aren't in a hurry to build up their libraries with games that aren't compatible with the new consoles, and Xbox One and PS4 owners are apparently not snapping up enough games to make up for it. This is bad news for GameStop, because its margins on software are a lot better than on hardware. The end result is that GameStop now expects to earn between $1.85 a share and $1.95 a share in the holiday quarter, well short of the $2.16 a share it earned a year earlier and its previous guidance that called for it to post a profit as high a
- [By Mani]
[Related -GameStop Corp. (GME) And A Lesson In Patience]
New hardware sales also dropped 19.4 percent to $148 million, reflecting a consumer pull-back for current legacy consoles ahead of the upcoming launches of Sony's PS4 and Microsoft's Xbox One ��both of which are expected this November.
- [By Wallace Witkowski]
GameStop Corp. (GME) �shares rose 2.1% to $37.65 on moderate volume after the video game retailer reported first-quarter earnings of 59 cents a share on revenue of $2 billion. Analysts surveyed by FactSet expected 57 cents a share on revenue of $2.02 billion.
- [By Matt Thalman]
One Dow component not having as good of a day is Wal-Mart (NYSE: WMT ) , as shares are basically flat. The stagnant share price seems a little odd after the giant retailer announced this morning that it would roll out a video game trade-in program. Beginning March 26, more than 3,100 Wal-Mart stores nationwide will accept old video games in exchange for Wal-Mart gift cards. The move is an attempt to draw in customers who otherwise would be going to places like GameStop (NYSE: GME ) . Shares of the video game specialty store are down 4% this afternoon on the announcement. Many have pointed to GameStop's quarterly results as a reason why it makes sense for Wal-Mart to get into the business. GameStop reported that 18% of its holiday shopping sales were pre-owned games, and that its first-quarter gross margin for the recycled games will range from 46% to 49%. These figures indicate there is a profitable market for used games. However, Wal-Mart is already so large that the additional revenue from used games will not be likely to move the needle. Still, this may help improve overall traffic to stores, which could result in noticeably higher sales. �
Hot Penny Companies To Watch For 2014: Gentiva Health Services Inc.(GTIV)
Gentiva Health Services, Inc. provides home health services and hospice care in the United States. The company offers skilled nursing and therapy services, paraprofessional nursing services, and homemaker services primarily to adult and elderly patients through licensed and Medicare-certified agencies. It also provides its services through specialty programs comprising Gentiva Orthopedics, which offers individualized home orthopedic rehabilitation services to patients recovering from joint replacement or other major orthopedic surgery; Gentiva Safe Strides that provides therapies for patients with balance issues; and Gentiva Cardiopulmonary, which helps patients and their physicians manage heart and lung health in a home-based environment. In addition, the company offers services through Gentiva Neurorehabilitation, which helps patients who have experienced a neurological injury or condition by removing the obstacles to healing in the patient?s home; Gentiva Senior Health that addresses the needs of patients with age-related diseases and issues; and Rehab Without Walls unit, which provides neurorehabilitation therapies for patients with traumatic brain injury, cerebrovascular accident injury, and acquired brain injury. Further, it offers consulting services to home health agencies, which include operational support, billing and collection activities, and on-site agency support and consulting. Additionally, the company provides hospice services primarily in the patient?s home or other residence, such as an assisted living residence or nursing home, as well as in a hospital. Gentiva Health Services, Inc. was founded in 1999 and is headquartered in Atlanta, Georgia.
Advisors' Opinion:- [By Jake L'Ecuyer]
Leading and Lagging Sectors
Healthcare stocks gained Wednesday, with Senomyx (NASDAQ: SNMX) leading advancers after the company announced a research agreement with PepsiCo (NYSE: PEP). Among the leading sector stocks, gains came from Pernix Therapeutics Holdings (NASDAQ: PTX), Albany Molecular Research (NASDAQ: AMRI) and Gentiva Health Services (NASDAQ: GTIV). - [By Sean Williams]
Last week, we saw home-health sector stocks like Amedisys (NASDAQ: AMED ) and Gentiva Health Solutions (NASDAQ: GTIV ) get clobbered because the Centers for Medicare and Medicaid Services recommended a 1.5% reduction in Medicare reimbursements each year between 2014 and 2017. With Amedisys and Gentiva reliant on Medicare for more than 80% and 90% of their revenue, respectively, it could put hospitals that rely on government reimbursements in a growth bind.�
Hot Penny Companies To Watch For 2014: China Ceramics Co. Ltd.(CCCL)
China Ceramics Co., Ltd. engages in the manufacture and sale of ceramic tiles used for exterior siding, interior flooring, and design in residential and commercial buildings primarily in the People's Republic of China. It offers porcelain tiles, glazed tiles, glazed porcelain tiles, rustic tiles, and ultra-thin tiles under the Hengda, Hengdeli, TOERTO, and WULIQIAO brand names. The company primarily sells its products through a distributor network, as well as directly to property developers. China Ceramics Co., Ltd. is based in Jinjiang City, the People's Republic of China.
Advisors' Opinion:- [By Lisa Levin]
China Ceramics Co (NASDAQ: CCCL) shares fell 2.40% to touch a new 52-week low of $1.63. China Ceramics shares have dropped 35.27% over the past 52 weeks, while the S&P 500 index has gained 19.70% in the same period.
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