Ticker Shock: Four Reasons Not to Build On KB Home-Minyanville

Ticker Shock: Four Reasons Not to Build On KB Home

Glenn Curtis Jun 29, 2009 11:35 am

Ticker Shock: Four Reasons Not to Build On KB Home


		Monday's top stories and stocks with potential to move.

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TRW Automotive (TRW):

The Michigan-based automotive-parts company reportedly landed an upgrade. The word is that JPMorgan gave it a goose from “neutral” to “overweight.” The news comes on the heels of an amendment of its credit facility.

Some quick thoughts:

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1. The shares could get a little goose and it could end up being a decent trade. Given the lack of news flow this morning, a lot of eyes could be on this baby.

2. At the same time, I’m not a long-term bull by any means, and I certainly don’t have plans to chase the stock. The main reason: the stream of red ink it’s expected to generate.

JC Penney (JCP):

The big-name retailer apparently received an upgrade from Morgan Stanley.

But I don’t think this is a reason in and of itself to be hopping in.

My thoughts:

1. I’m pretty old-school, in case you haven’t figured that out, and I'm a believer in JC Penney over the long haul. To that end, I’d consider doing a little nibbling.

2. But short-term, I continue to believe that discounters will do better than department stores. (Think about where you're shopping these days.)

3. What’s not to like about that dividend?

4. It's had a nice run since the beginning of April, and part of me is wondering if the shares could end up taking a bit of a breather.

5. I'm sure I've said it before, but when it comes to retail, Target (TGT) is the biggie on my radar screen.

Have a great day!

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