A humorous look at the companies that caught our eye, for better or worse, this week
Lockheed Martin (STAR)
If U.S. President Donald Trump wants to bring U.S. soldiers home, ordering the killing of Iran’s top general was a strange way to do it. After the deadly drone strike on Major-General Qassem Soleimani near Baghdad’s airport, the United States announced it is sending 3,000 additional troops to the Middle East to bolster its presence in the volatile region. With Iran vowing to retaliate for the killing and some observers fearing the conflict could escalate into war, shareholders of Lockheed Martin and other defence contractors are rubbing their hands with … great sadness.
Hudson’s Bay (STAR)
For Hudson’s Bay investors, Christmas arrived a few days late. Shares of the department store retailer surged this week on reports that a group led by executive chairman Richard Baker is preparing to raise its offer for the owner of Hudson’s Bay and Saks Fifth Avenue to $11 a share from its current bid of $10.30. Whether the new offer will materialize – and win the approval of minority shareholder Catalyst Capital Group – remains to be seen. But with the stock trading below $10, there are apparently some skeptics in the house.
Signet Jewelers (DOG)
Diamonds may be forever, but investors’ love affair with diamond retailer Signet Jewelers didn’t last long. Shares of the bauble merchant had rallied 25 per cent in December on hopes for a strong holiday season. But investors got cold feet after Wells Fargo downgraded the parent company of chains including Kay, Zales and Peoples to “underweight” from “equal weight” and slashed its price target to US$12 from US$16, saying the business continues to struggle and its credit operations are an “overhang.” The stock’s been left at the altar.
Core Laboratories (DOG)
Core Laboratories provides technologies that help energy producers squeeze more oil from their fields. Lately, however, the only thing the company has done is squeeze money from investors’ portfolios. Already down by nearly two-thirds over the previous 18 months, the shares sank again after the oilfield services company cut its fourth-quarter guidance and slashed its dividend by 54 per cent, citing a decline in U.S. well completions and slower-than-expected progress on large international and offshore projects. Here’s a crazy idea: Don’t invest in energy stocks.
Apple (STAR)
Who would pay more than $1,500 for an iPhone 11 Pro Max? A lot of people, apparently. Driven by optimism about holiday sales of iPhones and AirPods and by expectations that Apple’s new 5G phones will generate strong demand when they are released later this year, the shares started 2020 by hitting a fresh record. With Apple soaring 86 per cent in 2019 – making it the best performer on the Dow Jones Industrial Average – investors can afford to upgrade to the 512GB model for the low, low price of $1,999.
John Heinzl