Hello Friends!  Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice!  As always, please remember that I am an amateur investor, so please remember to consult with your professional investment advisers prior to making any investment decisions based on information on this website.

A few moments ago I posted a PODCAST ON SYSCO (SYY).  Usually I write up an entry first and then follow with a podcast.  Tonight I did it the other way around :).

We live in difficult times!  I don't really need to tell you about the growing unemployment, the latest bank failures, or what the New York Fed reported on manufacturing. These are things that everyone knows.

What is harder is trying to some reasonable place to park one's funds.  I would like to suggest that an investment in Sysco (SYY) might be a place to find some value and potential growth while waiting for the eventual economic recovery.

Sysco (SYY) closed today at $22.82, down $(1.12) or (4.68)% on the day.  I do not own any shares of this stock but have owned it in the past and would consider buying shares once again in the future.

Looking at a few of the things I like to review, the latest quarterly report was fair.  They met expectations on earnings which did decline slightly and came in a little light on revenue.  Longer term, looking at the Morningstar.com '5-Yr restated' we see that the company has a record of steadily growing its revenue, increasing its earnings---both of which did recently take a slight dip--paying a nice dividend and increasing it (the company now yields 4%), buying back its shares, increasing free cash flow, and maintaining a solid balance sheet.

Valuation-wise, looking at Yahoo "Key Statistics" on SYY, the company has a modes p/e of only 12.74 (trailing) with a PEG estimated at only 1.14.  The last split was over 8 years ago.

Certainly, the 'point & figure' chart from StockCharts.com is somewhat less than inspiring.  I am not sure I agree with the bearish objective of $11/share, but we don't see much in the way of technical support on this particular chart!

In some ways this type of 'pick' is out of my usual momentum play.  But then again, my own philosophy is being tempered by the difficult environment we are experiencing and the fact that little of the usual momentum type investment is apparent.  I would characterize this sort of stock as more of a GARP pick.  It shares many of the important characteristics that I look for in a company: the steady growth in revenue, earnings, dividends, and free cash flow.  It has been buying back its own shares and carries a solid balance sheet.  I even can see evidence of its business with its many shiny trucks on the road right where I work!

Anyhow, that's my idea of a 'comfort stock' in these uncomfortable times!  If you have any comments or questions, please feel free to leave them on the blog or email me at bobsadviceforstocks@lycos.com.

Yours in investing,

Bob 

Hello Friends!  Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice!  As always, please remember that I am an amateur investor, so please remember to consult with your professional investment advisers prior to making any investment decisions based on information on this website.

As I mentioned in an earlier blog, my 'trade' in PetSmart (PETM) was intended to be a short-term affair.  I had hoped that I could be reporting a large profit from this move which did indeed initially move higher after my purchase of 180 shars on 5/21/09 at a cost of $20.3676.  However with the market acting at best erratically this morning and with PETM trading below my cost on this block, I decided to step aside from this additional over-weighted addition and sold my 180 shares at $19.9524/share.  This represented a loss of $.4152/share or multiplied by 180 shares came out to a loss of $(74.736). Percentage-wise, this was a loss of (2.03)% so the damage really wasn't significant at all.  

I still like PetSmart (PETM) and have my 90 share position which I am quite bullish on.  However, as a trader, I have always had mixed results and always subscribe to the belief that one is best minimizing losses.

Will PetSmart (PETM) turn around tomorrow and prove me wrong?  I wouldn't be surprised.  But I shall participate in that appreciation if that is the future for this stock.  Meanwhile, I have a little more cash built up once again in the account for future investments and yes, an occasional 'trade'!

If you have any comments or questions, please feel free to leave them on the blog or email me at bobsadviceforstocks@lycos.com.

Yours in investing,

Bob

Hello Friends!  Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice!  As always, please remember that I am an amateur investor, so please remember to consult with your professional investment advisers prior to making any investment decisions based on information on this website.

I had the pleasure of putting together a new

PODCAST ON PETSMART

Please click above and listen to what I have to say about why I bought when other sold and what the outlook might be for this pet supply retailer.

Thanks for dropping by!  If you have any comments or questions, please feel free to leave them on the blog or email me at bobsadviceforstocks@lycos.com.

Yours in investing,

Bob

Hello Friends!  Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice!  As always, please remember that I am an amateur investor, so please remember to consult with your professional investment advisers prior to making any investment decisions based on information on this website.

I wanted to let all of you blog readers to know that I managed to get off my duff and post a new

PODCAST ON MCDONALD'S

That you are all welcome to listen to.  If you have any comments or questions, please feel free to leave them here or drop me a line at bobsadviceforstocks@lycos.com.

Yours in investing,

Bob

Hello Friends!  Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice!  As always, please remember that I am an amateur investor, so please remember to consult with your professional investment advisers prior to making any investment decisions based on information on this website.

PetSmart (PETM) is currently one of my six holdings in my 'trading portfolio'.  Up till today I owned 90 shares of PetSmart that I purchased back on November 20, 2008, at a cost basis of $15.50.  PETM closed at $20.35 today, down $(1.95) or (8.74)% so I still have a significant gain on this particular purchase.

Yesterday (5/20/09) after the close of trading PetSmart (PETM) announced 1st quarter 2009 results.  For the quarter ended May 3, 2009, the company earned $46.3 million or $.37/share on revenue of $1.33 billion, up from $41.2 million or $.32/share last year.  According to this report, Thomson Reuters analysts had been expecting a profit of $.30/share on revenue of $1.35 billion. 

Thus the company actually exceeded earnings estimates but did in fact miss revenue expectations by a small amount.  Same-store sales did increase 3.9% during the quarter.

PetSmart also went ahead and estimated profit of $.26 to $.30/share for the next quarter and raised full-year profit estimates to $1.42 to $1.52/share from prior guidance of $1.40 to $1.50/share.  The company guided expectations on revenue growth to the 'mid- to high-single digit sales'.  They also suggested that same-store sales growth is likely to continue albeit in the low-single digits. 

Thus the company announced positive earnings growth both absolutely as well as positive same-store sales growth, beat expectations on earnings, came in a little bit light on revenue and then raised guidance for the year on earnings.  Really not too shabby a result from my amateur perspective.

And yet for this the stock was punished severely. 

To be fair, an amateur is no match for a Goldman Sachs analyst who downgraded the retailer "despite its better-than-expected earnings in the first quarter."

As this article reported:

"Goldman analyst Matthew Fassler said the Phoenix-based company has "executed well," with strong sales and earnings compared to the rest of the retail sector and well-controlled costs. Its stock has outperformed the broader S&P 500 index in the past year, falling 3 percent instead of the 36 percent decline in the benchmark.

However, the company has little to drive its shares higher, given that recent same-store sales increases have been driven by food inflation and promotions, which don't add to profit margins. As inflation drops and foot traffic trends slowed in spring, he said, there's not much room for more growth in same-store sales."

The reaction seemed a bit severe.

If we review the 'point & figure' chart for PetSmart from StockCharts.com: