Ticker Shock: Papa John's, KB Home, Dell Tighten Belt; Weight Watchers Looking Large
Wednesday's top stories and stocks with potential to move.
Were you up late last night watching the election returns? Yeah, me too.
Anyway, Asia put up some mid-single-digit percentage gains overnight - but Europe is showing me some red. Here in the States, the Dow is off to a lower open.
So much for having a sustained election rally.
Papa John's (PZZA)
After the close last night, the Kentucky-based pizza chain released its third-quarter results. The company earned $0.28 per share, which was apparently a couple of pepperonis shy of the $0.36 per share the Street was looking for. Its top line came in a smidge over $280 million; the Street was looking for about $280.6 million.
The full-year earnings forecast, however, is now expected to come in at or below the low end of its previous guidance of $1.68 to $1.76, since the company will be doling out money to some of its beleaguered domestic locations.
On the bright side, it did show a positive 1.7% comp improvement. I suppose that's a bit of an achievement, given the tough times food chains are having these days.
Look, here's the deal: I think this stock has some potential over the next year or so. It's still a good name, it has a good-sized footprint, and -- for a stock that trades under $23 -- it's expected to kick out some pretty decent earnings.
That being said, I do think there are better opportunities out there at present. But I will keep it on my radar screen. If it gets pounded today, it may be worth taking a closer look.
KB Home (KBH)
Last night, after the close, the homebuilding company disseminated a release not too many shareholders would want to see. Put simply, KB cut its quarterly dividend to $0.625 - a 75% haircut.
To be clear, I can't say that's a dumb move, given the current environment. If I were on the board, I think I'd have been pushing for the same thing - and at least the firm didn't suspend it. Hey - you gotta look on the bright side these days, right?
Would I buy the stock?
No, not right now. I think that there are too many unknowns. But I will keep an eye on it.
By the way, looking at the data, it appears that there was an insider purchase back in June. That does pique my interest.
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