Dorel Industries (STAR)
Bicycle, bicycle, bicycle, I want to ... sell my bicycle. Shares of Montreal-based Dorel Industries jumped after the company announced the sale of its bicycle business, Dorel Sports, to Netherlands-based Pon Holdings NV for US$810-million in cash. Dorel said proceeds of the sale – which includes bike brands such as Cannondale, Schwinn and Mongoose – will be used to reduce debt, return capital to shareholders and for general corporate purposes. With the division fetching an attractive price thanks to strong demand for bicycles during the pandemic, Dorel’s stock pedalled to a three-year high.
Keg Royalties Income Fund (STAR)
“I’ll have the shrimp cocktail, baked brie and Caesar salad to start, please, followed by a New York striploin, full rack of ribs and lobster tail on the side.” Diners are flocking back to the Keg – and they’re making up for lost time, apparently. Citing “significant increases” in sales, which in some cases are exceeding prepandemic levels, the chain’s royalty fund this week raised its distribution to the same level it was before COVID-19 hammered the industry in 2020. With Keg’s units posting a total return of about 90 per cent in the past year, investors are thrilled – except the chumps who sold near the bottom.
Tata Motors ADR (STAR)
Business quiz! Shares of Tata Motors, the India-based auto giant that also owns Jaguar Land Rover Automotive, rose after the company: a) unveiled the Jaguar E-Type SUV – a 1960s-style sports car body bolted onto a pickup truck frame with mud flaps and monster tires; b) announced plans to merge with Japan’s largest car maker to create Toyotatata; c) reported strong second-quarter sales and disclosed that private equity firm TPG Group agreed to invest about US$1-billion to expand Tata’s electric-vehicle business. Answer: c.
Delta Air Lines (DOG)
Delta Air Lines? Hmm. Maybe not the best name to have during the pandemic. With the Delta variant of COVID-19 already posing a stiff headwind for the airline industry, Delta warned that surging fuel costs will probably cause the company to post a loss in the fourth quarter. The planned November reopening of the U.S. border to fully vaccinated air travellers from 33 countries will likely boost demand for flights, but after suffering its biggest one-day drop in a year, Delta’s stock could be sitting on the tarmac for a while.
Now we know why so many clothing retailers are struggling: Their customers are all shopping at Aritzia. With in-person shopping restrictions easing, sales at Aritzia’s bricks-and-mortar shops nearly doubled in its latest quarter and are now ahead of prepandemic levels, the Vancouver-based company said. Aritzia also benefited from growing demand in the United States and continuing strength in e-commerce, as overall net revenue rose 75 per cent. Now that Aritzia’s shares have gained almost 120 per cent in the past year and are trading at record levels, the stock is considered a fashion must-have.
A humorous look at the companies that caught our eye, for better or worse, this week
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