A humorous look at the companies that caught our eye, for better or worse, this week
Ketchup isn’t just a great way to bring out the flavour of hamburgers, French fries, filet mignon and slow-roasted leg of lamb. It can also add zip to an investment portfolio: Shares of H.J. Heinz soared after Warren Buffett’s Berkshire Hathaway teamed up with private equity firm 3G Capital to acquire the global food and condiment maker for $23.2-billion, or $72.50 a share, marking the biggest takeover of 2013. Waiter, another bottle of ketchup.
Canada’s investing Hall of Shame gained a new member this week when Poseidon Concepts, which supplies tanks used in natural gas fracking, disclosed that as much as 72 per cent of the revenue it reported in the first nine months of 2012 wasn’t actually, um, revenue. Poseidon’s stock, which had already been taking on water, quickly plunged to the bottom of the sea.
Want to slim down? Try Weight Watchers. Want your portfolio to slim down even faster? Try investing in Weight Watchers stock. Hurt by higher marketing costs as it battles competitors such as Jenny Craig, Nutrisystem and Medifast, the company posted an 8.9-per-cent drop in fourth-quarter earnings and issued a 2013 forecast well below expectations. Investors are feeling like The Biggest Loser.
Test your business knowledge! Angie’s List is:
a) a little black book containing the names of married Congressmen who will soon be resigning;
b) the long-awaited sequel to Schindler’s List;
c) A website where people rate local businesses.
Answer: c. Investors were giving the stock plenty of positive reviews after the company swung to a surprise fourth-quarter profit.
Whole Foods, otherwise known as “Whole Paycheque,” is trying hard to shed its reputation for high prices. Unfortunately, investors aren’t so thrilled with the idea. The natural foods grocer is offering more discounts and value-oriented products, but the company warned that gross margins will fall over the next three quarters because of lower prices and rising costs. As for the stock, there’s a Whole lot of selling going on.