A humorous look at the companies that caught our eye, for better or worse, this week
Empire Co. (STAR)
What grocery stores desperately need right now: bigger shopping carts. Empire Co. – parent of chains including Sobeys, FreshCo and Safeway – said same-store sales excluding fuel soared 37 per cent year-over-year for the four weeks starting March 8, as customers loaded up on toilet paper, canned goods, baking products and other supplies to ride out the pandemic. “Hi sweetheart, I forgot to mention we also need six bags of milk and eight family-sized boxes of Honey Nut Cheerios. I hope you’re not in line yet.”
Pizza Pizza Royalty (DOG)
There’s no such thing as a free lunch – just ask a Pizza Pizza Royalty investor. Shares of the company had been offering up a delicious-looking yield of more than 10 per cent. But with the coronavirus hammering walk-in sales at Pizza Pizza and Pizza 73 restaurants even as delivery orders remained “stable," the company this week slashed its payout by nearly 30 per cent – to five cents a month from 7.14 cents. Well, it’s better than nothing, which is what some restaurant royalty funds are paying.
Johnson & Johnson (STAR)
Pandemic, schmandemic. Bucking the trend of most businesses, health care giant Johnson & Johnson posted a 3.3-per-cent increase in sales for the first quarter as adjusted earnings of US$6.2-billion, or US$2.30 a share, topped Wall Street estimates. Even as sales of medical devices fell, the company sold more pharmaceuticals and over-the-counter products such as Tylenol to consumers who stocked up their medicine chests amid the coronavirus outbreak. With the company also announcing a 6.3-per-cent dividend increase, Johnson & Johnson’s stock keeps rising & rising.
Corus Entertainment (DOG)
Corus investors can’t catch a break. Even as Canadians are watching more TV as they self-isolate at home, the coronavirus is prompting advertisers such as airlines, restaurants and retailers to cancel commercial time. Given the uncertainty created by the pandemic, TV and radio broadcaster Corus put share buybacks on hold and has delayed a decision on whether to pay a quarterly dividend in June until it has more clarity on how long the crisis will last. Judging by the sinking share price, some investors are already changing the channel.
Gilead Sciences (STAR)
Take that, coronavirus. Shares of Gilead Sciences surged after statnews.com reported that the company’s experimental antiviral drug, remdesivir, was associated with “rapid recoveries in fever and respiratory symptoms” in a trial of 115 people – most with severe cases of COVID-19. The statnews.com story, based on a leaked video of comments by the professor overseeing the trial at the University of Chicago, raised hopes that the drug will prove to be an effective treatment. But with official data from this and other trials still to come, it may be too early to declare victory.
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