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Strategies & Market Trends : Value Investing

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To: geoffrey Wren who wrote (41306)	2/3/2011 12:01:02 PM
From: E_K_S	Read Replies (1) of 78662

Hi Geoffrey - Re: SuperValu Inc. Common Stock(NYSE: SVU ) - Stock up over 6% on heavy volume. Could be all of those 2010 year end sellers buying back in after their 31 day wait. Supervalu offers buyouts as Target moves distribution Date: Thursday, February 3, 2011 bizjournals.com From the article:"...A newly built Target Corp. distribution center in Iowa is apparently putting the hurt on Supervalu Inc. distribution operations in Illinois, with Supervalu offering buyouts to 57 employees there, according to a News-Gazette report..." -------------------------------------------------------------------------- It appears that Target is building their own Supply Chain business and its impacting Supervalu's business. Target also whats to expand into Canada and will need a supply chain vendor (or build their own) to provide services into that region too. It will be interesting to see how Supervalu responds (other than shutting down warehouse facilities). From today's news it appears this is exactly what they are doing but it's only a 10% downsizing rather than a complete shutdown. Lots of negative news and analysts downgrades. Yesterday huge OI expansion in the July 7 Put (over 5,000 new contracts sold to open for $1.00). The contrarian in me wants to buy but I am still waiting for the dust to settle and am looking for a lower low on lower volume for an entry point. EKS

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