Ooff! Bummer for Whole Foods shareholders
Posted By Mike On Aug 5, 2008 @ 11:42 pm In Biggest losers, Companies, Shorts | 1 Comment
The grocer is trading down 19% after hours on [1] news of 24 cents in fully-diluted earnings last quarter and projections for full year profits of 93 to 95 cents. They also halted their dividend and announced that only 15 new stores were in the works for 2009, down from up to 30.
The stock is down from over $70 two and a half years ago, but is still expensive at 20 times earnings with no yield. Why would you buy a high-end grocer at this point in the credit cycle when it doesn’t even pay a dividend? Aren’t dividends what grocery stores are for, anyway?
Disclosure: this post is a bit of a brag, since I bought puts last summer and am holding pat.
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Article printed from The Sovereign Speculator: http://sovereignspeculator.com
URL to article: http://sovereignspeculator.com/2008/08/05/ooff-bummer-for-whole-foods-shareholders/
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[1] news: http://biz.yahoo.com/rb/080805/wholefoods.html?.v=1
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