Check Out Line: It’s a bad idea to raise the turkey you sell

Aarthi Sivaraman — Thu, 21 Aug 2008 14:23:33 +0000

Check out why Heinz didn’t suffer like Hormel did in the past quarter.

H.J. Heinz came in with a quarterly profit that beat Wall Street expectations, helped by price increases and new product sales, while Jennie-O turkey seller Hormel Foods saw its earnings dip.

Food companies have found it tough going as commodity costs shoot up, but Hormel was particularly hard hit. The reason? It raises the turkeys that it eventually sells — meaning spiking corn feed costs hurt its results.

Also in food news – Burger King reported quarterly numbers that easily beat analysts’ expectations, as consumers headed to its restaurants for a burger or two. It also issued a fiscal 2009 outlook within Wall Street’s expectations.

On the apparel end, Children’s Place posted a small quarterly profit, helped by summer clothing sales and cost cuts. Still, the kids’ apparel retailer said it expects further pressure on consumer spending due to the weak U.S. economy.

To round up news in the sector, Kohl’s Corp, a mid-tier department store operator, named its president Kevin Mansell as its chief executive, replacing Larry Montgomery, who will remain the company’s chairman.

Also in the basket:

Skechers says still wants to buy Heelys

Shareholder aims to thwart Longs-CVS deal - NY Post

Tesco completes 605 mln stg of property deals

(Photo: Reuters)

Dr Pepper gets flat reception on Wall Street

Brad Dorfman — Wed, 07 May 2008 17:50:18 +0000

Dr Pepper Snapple Group debuted on the New York Stock Exchange Wednesday after being spun off from British candy and gum company Cadbury.

The company is putting together a five-year plan to improve its business in Latin America, but its main focus will be on selling more drinks in the United States, Chief Executive Larry Young told Reuters.

Unfortunately, that might not be what Wall Street wants to hear.

Dr Pepper’s exposure to the sluggish U.S. soft drinks business could hurt growth.

”The firm has a mixed stable of brands, lacks the scale and product portfolio breadth enjoyed by larger rivals Coke and Pepsi, and relies almost exclusively on the mature and highly competitive U.S. market,” Morningstar analyst Mitchell Corwin said.

Still, Young says the company’s brands will take care of themselves.

“We have great brands, great people and are focused on delivering great results,” he said. “We’ll let the market take care of the price.”

(Reuters photo)

Shop Talk » Wall Street

Check Out Line: It’s a bad idea to raise the turkey you sell

Dr Pepper gets flat reception on Wall Street