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Strategies & Market Trends : Value Investing

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To: E_K_S who wrote (35677)	10/13/2009 11:32:56 AM
From: E_K_S	Read Replies (2) of 78705

DJ MARKET TALK: Pali Warns Of 'Value Trap' In Grocer Stocks Edited by John Shipman 8:50 (Dow Jones) Pali Capital says recent run up in some grocery store stocks is "unjustified," and investors may be falling into a value trap in a struggling sector. Firm cuts Supervalu (SVU) and Great Atlantic Pacific (GAP) to sell, and lowers Safeway (SWY) estimates. Some optimism coming from expectations for tempered deflation, but Pali doesn't think that's enough to get bullish, especially since grocers are competing on price. Unemployment also may stay high for several years, hurting sales and margins. Wal-Mart (WMT) also a wild card on speculation it may get even more aggressive with prices. GAP down 3.7% premarket at $9.91; SVU down 2.2% at $15.72. ================================================================== SVU traded 5.09 million shares yesterday 62% above the average daily volume of 3.13 million shares. SVU cut to a sell from neutral by Pali Capital Here is the performance of WMT, SVU and TSCDY, TESCO (TSCDY) is Europe's WalMart. I switched into TESCO in 2007, selling 75% of my SVU. I later started adding to my SVU towards the end of 2008 and beginning 2009 where SVU is now a top 10 holding. finance.yahoo.com Value statistics: finance.yahoo.com SVU seems to be the best value proposition of the three but depending on how you value the companies, you can make similar arguments for WMT and even TSCDY. EKS

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