“Cut-to-the-Chase” Recommendations
- Week Beginning June 27, 2016 -

by Ian Harvey

IMPORTANT NOTE: There is no stop-loss or pre-determined sell price recommended – this is left to the discretion of the individual trader.




Wednesday, 29th June, 2016
McCormick & Company, Incorporated (NYSE:MKC) Calls

**OPTION TRADE: Buy the MKC July 15 2016 105.000 call at approximately $0.65. Sell price is left to your own judgment.

McCormick & Company, Incorporated (NYSE: MKC), a manufacturer, marketers and distributor of spices, seasoning mixes, condiments and other flavorful products to the food industry, is set to report second-quarter 2016 results on June 30, before the market opens. Analysts expect McCormick & Company, to post earnings of $0.74 per share and revenue of $1.06 billion for the quarter. Last quarter, this global leader in spices and flavors posted a positive surprise of 7.25%.

In fact, the company has delivered positive earnings surprises in three of the last four quarters, making for an average surprise of 4.02%.

McCormick has been witnessing rising demand for spices, herbs and seasonings over the last few years. Further, its focus on building sales through acquisitions has been driving its earnings. Keeping up the trend of acquisitions, in Apr 2016, McCormick acquired Australia-based Botanical Food Company, the seller of the Gourmet Garden brand of packaged herbs. Gourmet Garden is a global market leader in chilled convenient packaged herbs. In fact, the company has an optimistic view of the second quarter, owing to recent acquisitions and strong sales momentum.

Further, McCormick has also been regularly launching new products in order to remain competitive. Its increasing focus on higher pricing and cost savings and enhancing productivity through its ongoing initiative, the Comprehensive Continuous Improvement (‘CCI’) program is also encouraging.

McCormick & Company‘s stock had its “hold” rating reiterated by research analysts at Deutsche Bank in a research report issued to clients and investors last Friday. They currently have a $110.00 target price on the stock, up from their previous target price of $105.00. Deutsche Bank’s price objective indicates a potential upside of 8.82% from the stock’s previous close.

McCormick & Company, Incorporated will open at 102.02 today. The firm has a market cap of $12.95 billion and a price-to-earnings ratio of 31.00. McCormick & Company, Incorporated has a 52-week low of $75.68 and a 52-week high of $102.48. The company’s 50-day moving average price is $98.59 and its 200-day moving average price is $92.90.



Wednesday, 29th June, 2016
ConAgra Foods Inc (NYSE:CAG) Calls

**OPTION TRADE: Buy the CAG July 15 2016 48.000 call at approximately $0.85. Sell price is left to your own judgment.

ConAgra Foods, Inc. (NYSE: CAG), an operator of a packaged food company, is scheduled to release its Q416 earnings data tomorrow, Thursday, June 30th. Analysts expect ConAgra Foods to post earnings of $0.52 per share and revenue of $2.89 billion for the quarter. ConAgra Foods has set its Q4 guidance at $0.50 EPS.

ConAgra Foods, Inc. operates as a food company primarily in North America. The company operates through three segments: Consumer Foods, Commercial Foods, and Private Brands. The stock currently has a dividend yield of 2.1%. Currently there are 5 analysts that rate ConAgra Foods a buy, no analysts rate it a sell, and 4 rate it a hold.

The average volume for ConAgra Foods has been 2.5 million shares per day over the past 30 days. ConAgra has a market cap of $20.5 billion and is part of the consumer goods sector and food & beverage industry. The stock has a beta of 0.25 and a short float of 1.1% with 2.24 days to cover. Shares are up 11.2% year-to-date as of the close of trading last Friday.

Shares of ConAgra Foods Inc will open at 47.10 today. The firm has a 50-day moving average of $46.15 and a 200-day moving average of $43.51. ConAgra Foods Inc has a one year low of $37.97 and a one year high of $47.94.

Constellation Brands, Inc. will open at 157.65 today. Constellation Brands, Inc. has a one year low of $114.49 and a one year high of $165.81. The firm’s 50-day moving average is $156.04 and its 200 day moving average is $149.64.



Wednesday, 29th June, 2016
Constellation Brands, Inc. (NYSE:STZ) Calls

**OPTION TRADE: Buy the STZ July 15 2016 165.000 call at approximately $1.25. Sell price is left to your own judgment.

Constellation Brands, Inc. (NYSE: STZ), a producer and marketer of beer, wine and spirits with operations in the United States, Canada, Mexico, New Zealand and Italy, is set to post earnings results before the opening bell tomorrow, Thursday, 30th June -- and positive results are expected. The stock is up 30% over the past year, and is sitting near an all-time high ahead of the report.

That optimism is founded in sharply improving business fundamentals. Constellation's profits are soaring as its beer portfolio, anchored by the Modelo and Corona brands, post awesome growth. Sales improved by double digits in the segment last quarter, even as prices rose. As a result, the beer division saw a 24% earnings boost which outpaced the wine business and its 8% uptick.

Constellation is doubling down on beer by bringing new breweries online. The strong profit growth is also adding plenty of financial flexibility to the business. Aside from pouring resources into new breweries, Constellation has made two big acquisitions in the last year, devoted cash to higher share buybacks, and initiated a dividend.

Constellation Brands, Inc. will open at 157.65 today. Constellation Brands, Inc. has a one year low of $114.49 and a one year high of $165.81. The firm’s 50-day moving average is $156.04 and its 200 day moving average is $149.64.



Tuesday, 28th June, 2016
Monsanto Company (NYSE:MON) Puts

**OPTION TRADE: Buy the MON July 01 2016 100.000 put at approximately $1.20. Sell price is left to your own judgment.

Monsanto Company (NYSE: MON), a provider of agricultural products for farmers, is scheduled to report third-quarter fiscal 2016 results before the opening bell tomorrow, June 29.

Despite any positives the company remains exposed to certain macroeconomic risks. Negatives like economic slowdown in major emerging nations like China, cyclical downturn of agricultural industry, low prices of agro products, strengthening U.S. dollar and devaluating Argentinean Peso might overshadow the positive aspects. Based on these issues, the company had lowered its fiscal 2016 earnings guidance to the range of $4.40-$5.10 per share from the previous estimation of $5.10-$5.60.

Also, Monsanto usually undertakes strategic mergers and acquisitions to enhance its business. However, in an unusual turn of events the company was approached by Bayer AG in May 2016 with a proposed takeover bid. Though Monsanto rejected the $122 per share bid on grounds of being "insultingly low," it is expect that the companies will engage in further negotiations going forward.

Monsanto Company was assigned a $92.00 target price by research analysts at Goldman Sachs in a report issued on Monday. The brokerage currently has a “sell” rating on the stock. This means that Goldman Sachs’ price target points to a potential downside of 11.60% from the company’s current price.

Three equities research analysts have rated the stock with a sell rating, eight have assigned a hold rating and fifteen have issued a buy rating to the company. The company currently has a consensus rating of “Hold” and an average target price of $106.57.

The company’s 50-day moving average price is $104.70 and its 200-day moving average price is $94.82. The stock has a market capitalization of $44.96 billion and a P/E ratio of 32.640. Monsanto Company has a 12-month low of $81.22 and a 12-month high of $114.26.



Tuesday, 28th June, 2016
General Mills, Inc. (NYSE:GIS) Puts

**OPTION TRADE: Buy the GIS July 15 2016 65.000 put at approximately $1.00. Sell price is left to your own judgment.

General Mills, Inc. (NYSE: GIS), a consumer-goods maker, will report its fiscal fourth-quarter results before the market opens tomorrow, June 29, with the consensus calling for earnings of $0.60 per share and revenue of $3.86 billion for the quarter. During the same period last year the company had earnings of $0.75.

Sales and profits in General Mills’ U.S. Retail segment have been soft due to lower demand amid changing consumer food preferences. In fiscal 2016, increased competitive activity in Yogurt and reduced display and merchandizing levels hurt results in the segment. To cater to the evolving consumer tastes, the company is investing in consumer-focused innovation and marketing along with the accelerating distribution of its natural and organic brands in fiscal 2016.

Management’s renovation and innovation efforts with a higher level of advertising is expected to lead to better organic (excluding currency headwinds and the Green Giant divesture) sales trends in the U.S. Retail segment in the fourth quarter, largely in cereals and snacks. Organically, sales growth is expected to turn positive in the fourth quarter, rising in a low single-digit range.

General Mills divested its Green Giant and Le Sueur brands of frozen and shelf-stable vegetables to food manufacturer, B&G Foods, Inc. BGS, in November last year.

However, like the third quarter, net sales, segment operating profit and adjusted earnings are expected to decline in the fourth quarter due to the Green Giant divesture, currency headwinds and difficult year-over-year comparisons. The year-ago comparable quarter gained from an extra week.

Adjusted gross margins are expected to decline year over year in the fourth quarter, reflecting the highest quarterly input cost inflation rate. Media expenses are expected to rise in a double-digit range, excluding currency impact which will hurt operating profits.

General Mills, Inc. has a one year low of $47.50 and a one year high of $66.88. The firm has a market capitalization of $39.34 billion and a P/E ratio of 27.05. The company’s 50-day moving average is $64.23 and its 200-day moving average is $60.52.



Monday, 27th June, 2016
Nike Inc (NYSE:NKE) Calls

**OPTION TRADE: Buy the NKE July 15 2016 55.000 call at approximately $0.70. Sell price is left to your own judgment.

Nike Inc (NYSE: NKE), a seller of athletic footwear and athletic apparel worldwide, will report its fiscal fourth-quarter numbers tomorrow, June 28. The company will post its quarterly results after the market close, with the consensus calling for earnings of $0.48 per share, down a penny from the same period last year.

After a very bullish multi-year run for NKE, shares have cooled off a bit in 2016, but the underlying fundamentals for the company remain very strong. The still strong “athleisure” fashion trend should continue to keep strength under the entire athletic sector, as evident by the recent solid quarterly report from Finish Line (FINL), which topped estimates for both the top and bottom line, and led to a sharp jump in FINL shares.

A big reason why NKE shares have underperformed in 2016 is the stock’s valuation. Even with the recent losses, the stock trades with a P/E of 24.6, but with earnings expected to rise 16.2% this year, and 14.4% next year, additional downside risk in the stock is limited at this time.

At present there are twenty-five analysts that have given a buy rating and one has assigned a strong buy rating to the stock. Nike presently has a consensus rating of “Buy” and a consensus target price of $69.87.

The stock is down 14.9% on the year.

Nike has a 50 day moving average of $55.71 and its 200 day moving average is $59.57. The company has a market cap of $89.29 billion and a PE ratio of 24.54. Nike has a 1-year low of $47.25 and a 1-year high of $68.19.




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