More From Diana Key
It Was a Festive Holiday Season for Signet Jewelers
On January 7, 2016, Signet Jewelers (SIG), the world’s largest retailer of diamond jewelry, announced its broad-based success in the holiday season with revenue of $1.9 billion.
ValueAct Capital Ups Its Stake in Allison Transmission Holding
Allison Transmission Holding and its subsidiaries design and manufacture commercial and defense fully automatic transmissions.
AQR Capital increases stake in Intel
Intel generated ~$5.7 billion in cash from operations. The company paid quarterly dividends of $1.1 billion and repurchased 122 million shares for $4.2 billion.
Farallon Capital sells stake in Yahoo!
Farallon Capital Management sold its position in Yahoo! Inc. (YHOO) during the third quarter. The stock accounted for 3.39% of the fund’s total 2Q14 portfolio.
Eminence Capital Reduces Position in Humana
During the fourth quarter of 2014, Eminence Capital lowered its stake in Humana (HUM). The company accounted for 1.33% of the fund’s 4Q14 portfolio.
Highfields Capital exits its position in Broadcom
Highfields Capital sold its position in BRCM in the third quarter. The position accounted for 1.66% of the fund’s 2Q14 portfolio. Broadcom makes semiconductors for wired and wireless communications.
Citadel Advisors Starts a New Position in Altera Corporation
During 4Q14, Citadel Advisors started a new position in Altera Corporation (ALTR).
Analyzing Hershey’s Emphasis on Product Innovation
Hershey plans to position dark chocolate as a lifestyle choice in the US. It has thus begun promoting its dark chocolate brands for specific consumption.
Mead Johnson Plans to Focus on R&D to Support Innovations
Mead Johnson follows a strategy of investments in innovation, having expanded its liquids portfolio and rolled out its key specialty formulas across Asia.
B/E Aerospace spun off KLX business on activist push
On December 17, 2014, B/E Aerospace completed its spin-off of KLX, Inc., from B/E Aerospace, and KLX started trading on NASDAQ under the ticker symbol KLXI.
Weighing Kraft Heinz’s Strengths and Opportunities
Kraft Heinz has a wide network of processing facilities and distribution centers, which allow it to supply fresh and high-quality products to customers.
Evaluating Kraft Heinz’s Core Business Strategies
Kraft Heinz is focusing on core business practices, including ZBB (zero-based budgeting), revenue management, and MBO (management by objectives).
An Overview of Hershey, America’s Largest Chocolatier
Hershey is the largest producer of chocolate in North America. It is a global leader in chocolate, sugar confectionery, and chocolate-related products.
State of the Jewelry Industry in 2015: Growth and Challenges
Trends shaping the jewelry industry include Increasing demand for branded jewelry and an increased focus on e-commerce sales.
Hershey’s Steps to Improve Suppliers Productivity and Conscious Sourcing
Hershey has set a goal of sourcing 100% cocoa from certified cocoa farms. In fiscal 2014, it sourced 30% certified cocoa.
Eminence Capital raises its position in Xoom
Increased mobile adoption of Xoom’s mobile products led Latin America revenue, which rose 48% YoY. Gross sending volume increased 29% YoY.
AQR Capital initiated position in Bally Technologies Inc.
AQR Capital initiated a position in Bally Technologies during the third quarter of 2014 that accounts for 0.22% of the fund’s 3Q14 portfolio.
Key Takeaways from ValueAct Capital’s 4Q14 Holdings
ValueAct opts for long-term positions in companies that it believes are undervalued. With its significant stake, the fund works with the company to improve shareholder returns.
TPG-Axon raises position in GNC Holdings
In 3Q14, same-store sales—as measured on a product-only basis—decreased 6.9% in domestic company-owned stores, including GNC.com.
How Manitowoc’s 3Q results reflect “muted demand environment”
Manitowoc has a global footprint with presence in all major geographies and serves diversified end markets.
Glenview Capital lowers position in Crown Castle International
In 4Q14, Glenview Capital lowered its position in Crown Castle (CCI). CCI accounts for 0.34% of the fund’s total 4Q14 portfolio, down from 3.40% in 3Q14.
Micron Technology’s Lower Position in Point72 Asset Management
Point72 reduced its position in Micron Technology. It sold 4,792,200 shares during 4Q14. The shares accounted for 0.28% of the fund’s total 4Q14 portfolio.
JAB to Challenge Nestle, Global Leader of Portioned Coffee Market
JAB’s share in the global coffee market is estimated to reach approximately 20% with the addition of Keurig’s brands and products to its portfolio.
Sizing up Kraft Heinz’s SKU Rationalization Technique to Manage Inventory
Heinz has been using an inventory management technique, SKU rationalization to focus on profitable growth, which helps improve sales and profitability.
Tiffany’s Competitive Position: Porter’s Five Forces Analysis
Porter’s Five Forces model suggests that there are five forces that determine the attractiveness and long-term profitability of an industry or a sector.
Analyzing Tiffany’s Largest Segment: The Americas
Tiffany & Co.’s Americas segment includes sales from company-operated retail stores in the United States, Canada, Mexico, and Brazil.
Assessing Hershey’s Customer Relationships and Initiatives
Hershey is planning to stop using GMO sugar, milk from cows treated with growth hormones, artificial colors and flavors, and high fructose corn syrup.
Point72 Reduces Its Stake in Valeant Pharmaceuticals
Point72 reduced its stake in Valeant Pharmaceuticals by selling 924,400 shares. It held 132,300 Valeant shares. Valeant accounted for 0.13% of the fund’s 4Q14 portfolio.
ValueAct Capital discloses activist stake in Baker Hughes
Activist hedge fund ValueAct Capital declared a 5.1% stake in Baker Hughes in its 13D filing on January 15, 2015.
ValueAct Capital Lowers Its Stake in CBRE Group
CBRE Group reported 4Q14 revenue of $2.8 billion, an increase of 25% on a year-over-year (or YoY) basis.
Citadel Advisors Raises Position in United Technologies Corporation
United Technologies Corporation (UTC) provides high technology products and services to the building systems and aerospace industries worldwide.
Hurdles in Tiffany’s Growth: Weaknesses and Threats
Since it’s a luxury brand, Tiffany & Co.’s products are priced high, with no promotions. Thus, Tiffany products may be out of reach for many customers.
What Every Investor Needs to Know about Kraft Heinz: A Series Overview
The Kraft Heinz Company is the third-largest food and beverage company in North America and the fifth-largest food and beverage company in the world.
Why China Is Such an Important Market for Hershey in 2015
Hershey is the fastest-growing confectionery company in China, and Hershey expects China to become its second-largest market behind the US by 2017.
Highfields Capital Management’s positions in 3Q14
Highfields Capital Management LP is based in Boston. The fund was founded by Jonathon Jacobson in 1998. The fund’s US long portfolio declined slightly to $12.8 billion in the third quarter.
Manitowoc to spin off after activist pressure
In its 8K filing with the SEC on January 29, Manitowoc announced that it will split its cranes and foodservice businesses.
Analyzing Eminence Capital’s 13G filings
In 3Q14, Eminence Capital’s portfolio increased slightly to $6.83 billion, compared to $6.05 billion in the second quarter.
Why Tiffany & Co. Is More Profitable than Its Competitors
Since 2006, Tiffany’s margins have been on the higher side compared to its peers, including Signet Jewelers and Fossil, in the retail jewelry industry.
Why Tiffany Is Spending More on Marketing
Tiffany has been increasing its advertising expenses. In fiscal 2015, it spent $284 million on advertising, marketing, and public and media relations.
Signet Jeweler’s Market Positioning in the Retail Jewelry Industry
Total retail jewelry sales in the US grew at a CAGR of 4.4%, reaching $74.7 billion in 2014. Fine jewelry sales grew at a CAGR of 5%, reaching ~$69 billion.
Eminence Capital lowers stake in VCA Antech, Inc.
Eminence Capital lowered its position in VCA (WOOF) during 3Q14. The stock accounts for 1.95% of the total portfolio—down from 3.01% of the fund’s 2Q14 portfolio.
Point72 Asset Management begins position in Jones Energy
Jones Energy is an independent oil and gas company engaged in the exploration, development, production, and acquisition of oil and natural gas properties.
Why JANA Partners Considers CSC To Be Undervalued
JANA Partners declared its increased stake in CSC, believing that the company is undervalued. JANA wants CSC to look for strategic alternatives.
Horseman Capital reduces its position in Newmont Mining
Newmont Mining is one of the world’s largest gold producers and is the only gold company included in the S&P 500 Index and Fortune 500.
A must-know overview of Baker Hughes
Baker Hughes is a leading supplier of oilfield services, products, technology, and systems to the worldwide oil and natural gas industry.
Pandora Media Is a New Position for Eminence Capital
Eminence Capital initiated a position in Pandora Media (P) during the fourth quarter. Pandora shares accounted for 2.22% of the fund’s 4Q14 portfolio.
Signet Jewelers’ Core Strength: Exclusive Merchandise Offerings
Signet Jewelers has taken on several merchandise initiatives in 2015. It expects its “Ever Us” offering to become a new trend in the jewelry industry.
TPG-Axon raises position with Monsanto
Monsanto received USDA recommendations for deregulation for both Roundup Ready Xtend soybeans and Bollgard II XtendFlex cotton.
Appaloosa Management lowers stake in Google
Google provides Internet-related services and products. These include advertising technologies, search, cloud computing, and software.
JANA’s Track Record As an Activist Investor
Activist investor JANA Partners sold a 20% stake in the firm to Neuberger Berman’s Dyal Capital Partners. Dyal holds a passive interest in JANA Partners.
How does Baker Hughes stack up against its industry peers?
According to Barclays, BHI is “overweight” and it has set a price target of $65 for the company. KeyBanc gave Baker Hughes a “hold” rating.
Farallon Capital initiates position in Tim Hortons
Farallon Capital Management started a new position in Tim Hortons Inc. (THI) during the third quarter of 2014. The position accounted for 2.62% of the fund’s 3Q14 portfolio.
How KLX Inc. compares to its peers
KLX expects tax goodwill of $1.2 billion to provide cash tax savings of $254–$277 million for the next 15 years.
Assessing Signet Jewelers’ Market Valuation
As of January 8, 2016, Signet Jewelers was trading at the highest forward PE multiple compared to its peers, including Tiffany and Fossil Group.
Signet Jewelers’ Ever Us Is Setting Trend for Jewelry Industry
Signet launched a new collection called Ever Us in October 2015. It’s meant to meet the need for jewelry that represents the bond between two people.
Hurdles in Kraft Heinz’s Growth: Weaknesses and Threats
Frequent recalls not only affect the consumer satisfaction and brand image of Kraft Heinz’s products but also increases the cost factor.
Kraft Heinz Implements Zero-Based Budgeting to Reduce Costs
3G Capital applied a ZBB approach, which starts from zero-base and analyzes every functional area for cost, to Heinz, after it acquired the firm in 2013.
Evaluating Kraft Heinz’s Financials against Its Biggest Competitors
Kraft Heinz had a coverage ratio of 0.87x at the end of 3Q15, whereas McCormick & Company and Mondelēz had coverage ratios of 10.2x and 56.1x, respectively.
Analyzing Kraft Heinz’s Great Brands Strategy
Kraft Heinz is shifting its focus on advertising spending from non-working media to working media.
Analyzing Kraft Heinz’s Objective of Profitable Sales Growth
Kraft Heinz plans to reinvest savings from cost initiatives into its brands and to refocus its strategic vision on innovation.
Kraft Heinz Aims to Become an International Heavy Hitter
Kraft Heinz could have the opportunity to improve its revenues by expanding into the untapped international market through the Heinz platform.
What’s on the Table with Kraft Heinz? Getting to Know the Company’s Product Offerings
Kraft Heinz operates more than 200 brands in nearly 200 countries. Its eight iconic brands contribute more than $1 billion in sales apiece to total revenue.
Breaking down Kraft Heinz: A Segmental and Geographical Overview
The US accounted for 67% of Kraft Heinz’s fiscal 2014 pro forma sales, with Canada and Europe each contributing 10% of total sales.
A Key Analysis of the Kraft-Heinz Merger
In early 2015, Berkshire Hathaway and 3G Capital designed the Kraft-Heinz merger by pairing the Kraft Foods Group with H. J. Heinz Company.
A Porter’s Five Forces Analysis of Kraft Heinz Company
Kraft Heinz faces competition from a huge number of players in the food market, but product differentiation is low between its competitors.
Assessing Tiffany’s Market Valuation Relative to the S&P 500
Tiffany is trading at a higher multiple than its peers Signet and Fossil and at a higher valuation relative to SPY and the Dow Jones Industrial Average.
Weighing Tiffany’s Strengths and Opportunities
In April 2015, Tiffany launched its vintage-inspired CT60 watch collection, considering the growth opportunities in the global luxury timepiece market.
What Challenges Has Keurig Green Mountain Been Facing?
Keurig Green Mountain (GMCR) has been facing struggles in the coffee market (XLP), as Keurig’s patent for K-Cup pods, the single-serve coffee containers, expired in September 2012.
Low Inventory Turnover Is a Concern at Tiffany & Co.
At the end of fiscal 2015, Tiffany had a total inventory of $2.4 billion and inventory turnover of 0.73x, implying potential low sales and excess inventory.
Analyzing Tiffany & Co.’s International Segments
Tiffany & Co. has presences to differing degrees in the Asia-Pacific, Japan, Europe, and Other regions.
Analyzing Tiffany’s Key Strategic Objectives
Tiffany’s key strategic objectives for growth include expanding marketing communications, opening stores in key markets, and enhancing in-store experience.
A Must-Know Business Overview of Tiffany & Co.
Tiffany & Co. is a holding company that operates through its subsidiary companies. The most notable is Tiffany & Company, a jeweler and specialty retailer.
Evaluating Signet Jeweler’s Marketing Strategies and Initiatives
Signet Jewelers’ well-known, exclusive brands aim to influence consumers in their buying decisions. Sterling Jewelers thus provides 32% branded assortments.
Why Signet Jewelers Prioritizes E-Commerce as a Growth Driver
Signet acknowledges the value of e-commerce growth and its ability to maximize in-store experiences. Signet has thus integrated its website with its stores.
Weighing Signet Jewelers’ Debt against Competitors
Signet Jewelers, the largest specialty retail jeweler in the US, the UK, and Canada, had a debt of $1.5 billion on its balance sheet in fiscal 2015.
Signet Jewelers’ Aim to Improve Vertical Integration and Supply Chain
Signet aims to advance its vertical integration, including the sourcing and manufacturing of rough diamonds, which should help improve its supply chain.
A Snapshot of Signet Jewelers’ Divisions and Product Offerings
Signet Jewelers operates under three divisions: the Sterling Jewelers division, the Zale division, and the UK Jewelry division.
A Sparkling Performance: Key Investor Guide to Signet Jewelers
Signet Jewelers operates through 100% owned subsidiaries with a presence in the US, the UK, and Canada. It has ~3,600 stores under various name brands.
Evaluating Hershey’s Financials Against Its Competitors
Hershey had a total debt of $2.4 billion on its balance sheet in 2014. It had a total debt-to-equity ratio of 195% during the same period.
Evaluating Hershey’s Rising Margins in 2015
Since fiscal 2007, Hershey’s gross margin, EBITDA margin, operating margin, and net income margin have all increased—with only a few exceptions.
Hershey’s Acquisition of Shanghai Golden Monkey: Disappointment?
Hershey believes it made a smart decision in acquiring SGM. In 4Q15, it expects to complete the acquisition by acquiring the remaining 20% of the business.
Hershey’s New Focus on International Growth Opportunities in 2015
Hershey’s international segment contributes only ~30% of total revenues. Its goal is to increase international revenues to ~50% of total revenues by 2018.
Hershey’s Competitive Strategies for North America in 2015
Along with advertising, Hershey is focusing on cross-merchandising complimentary products like beverages and snacks, which should help expand consumption.
How Hershey Gained from Improving Its Supply Chain
In 2010, Hershey announced Project Next Century, which aims to streamline its global supply chain operations and create a more competitive cost structure.
Evaluating Hershey’s Marketing Strategies and Initiatives
Hershey applies a micro-marketing concept to its businesses, which means that it markets certain products to small target audiences.
Snyder’s-Lance to Acquire Diamond Foods for ~$1.9 Billion
On October 28, a definitive agreement for Snyder’s-Lance to acquire Diamond Foods was entered. Snyder’s-Lance will acquire all outstanding shares of Diamond Foods.
Analyzing Hershey’s Segments and Product Offerings
In its international business, Hershey is mainly focusing in emerging markets of Mexico, Brazil, India, and China.
A Glance at Hershey’s Leadership in the US Confectionery Industry
Hershey is a leading player in the confectionery industry, which grew globally at a CAGR of 4.9% from 2009–2014, reaching $198.4 billion in 2014.
Citadel Advisors Reduces Position in Archer Daniels Midland
The Archer Daniels Midland Company is a processor of oilseeds, corn, wheat, cocoa, and other agricultural commodities.
Citadel Advisors Lowers Position in Halliburton Company
In November, Halliburton agreed to acquire its major competitor, Baker Hughes (BHI). Halliburton expects to achieve $2 billion in annual cost synergies after completing the deal.
Citadel Advisors Lowers Position in JPMorgan Chase
JPMorgan Chase is a leading global financial services firm. The company has $2.5 trillion in assets and operations worldwide.
Citadel Advisors Adds a New Position in ConAgra Foods
During the fourth quarter of 2014, Citadel added a new position in ConAgra Foods (CAG).
Highlights of Citadel Advisors’ 4Q14 Portfolio
Citadel Advisors’ 4Q14 portfolio increased by 3.63% to $82.66 billion from $76.77 billion in 3Q14.
Will CSC’s Aggressive Cost Cuts Help in the Long Run?
CSC delivered cost savings of $115 million in 3Q15 and $310 million YTD. CSC expects to deliver cost takeout benefits of $450 million–$500 million in 2015.
Computer Sciences Corporation’s Focus on Cloud and Big Data
International Data Corporation expects the global big data technology and services market to grow at a CAGR of 26.4% to reach $41.5 billion in 2018.
Point72 Asset Management Lowers Its Stake in Devon Energy
Point72 lowered its stake in Devon Energy by selling 1,664,900 shares. It held 1,044,900 Devon Energy shares—0.45% of the fund’s total 4Q14 portfolio.
Point72 Asset Management Sells Stake in Southwestern Energy
Point72 sold its stake in Southwestern Energy during 4Q14. The fund held 2,124,400 shares at the end of 3Q14. It accounted for 0.56% of the fund’s 3Q14 portfolio.
Point72 Asset Management Exits Its Stake in Talisman Energy
Point72 exited its stake in Talisman during 4Q14. It held 10,744,200 Talisman shares at the end of 3Q14. It accounted for 1.03% of the fund’s 3Q14 portfolio.
Point72 Asset Management Exits Stake in LyondellBasell
Point72 sold its position in LyondellBasell during 4Q14. The fund held 1,130,700 shares at the end of 3Q14. It accounted for 0.92% of the fund’s 3Q14 portfolio.
LinkedIn Is a New Position for Point72 Asset Management
Point72 started a new position in LinkedIn during 4Q14. The fund held 612,600 LinkedIn shares. It accounts for 0.99% of the fund’s total 4Q14 portfolio.