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Carrefour, Daphni Partner To Launch Venture Capital Fund Focused On Digital Retail Startups

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On CNBC&#39;s &#34;Fast Money Halftime Report,&#34; Jon Najarian said he bought Vipshop Holdings Ltd - ADR (NYSE: VIPS) during the show and he intends to sell calls against it in the next couple of da

&#39;Fast Money Halftime Report&#39; Picks For May 21

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JPMorgan&#39;s Retail Analyst: Trump, Warm Weather And The Back Half Of 2016

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<ul>
<li>French retail giant&nbsp;Carrefour&nbsp;(OTC: <a class="ticker" href="https://www.benzinga.com/stock/crrfy#OTC">CRRFY</a>)&nbsp;<a class="editor-rtfLink" href="https://www.carrefour.com/en/actuality/dastore" style="background-image:initial; background-position:initial; background-size:initial; background-repeat:initial; background-attachment:initial; background-origin:initial; background-clip:initial; margin-top:0pt; margin-bottom:0pt; color:#4a6ee0" target="_blank">has partnered with European venture capital</a>&nbsp;firm&nbsp;Daphni&nbsp;to launch&nbsp;Dastore, a venture capital fund.</li>
<li>The fund aims to invest in early-stage startups addressing the digital retail space.&nbsp;</li>
<li>The fund will initially invest &euro;80 million by taking minority stakes in high potential emerging startups in France and globally.</li>
<li>The move comes after Carrefour pledged to spend &euro;3 billion between 2022 and 2026 to step up digital expansion,&nbsp;<a class="editor-rtfLink" href="https://www.reuters.com/business/retail-consumer/carrefour-launches-fund-invest-digital-retail-startups-2022-04-04/" style="background-image:initial; background-position:initial; background-size:initial; background-repeat:initial; background-attachment:initial; background-origin:initial; background-clip:initial; margin-top:0pt; margin-bottom:0pt; color:#4a6ee0" target="_blank">Reuters reported</a>.</li>
<li>The investment will focus on business areas related to Carrefour&#39;s digital strategy priorities, such as new e-commerce businesses, data, and digital tools for operations and financial services in retail and logistics and supply chain.</li>
<li>Price Action:&nbsp;CRRFY shares closed at $4.31 on Friday.</li>
<li>Photo via Wikimedia Commons</li>
</ul>

On <a href="https://www.cnbc.com/video/2021/05/21/final-trades-facebook-coinbase-global-vipshop-more.html">CNBC&#39;s &quot;Fast Money Halftime Report,&quot;</a> Jon Najarian said he bought Vipshop Holdings Ltd - ADR (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vips#NYSE">VIPS</a>) during the show and he intends to sell calls against it in the next couple of days.
Michael Farr said he loves Facebook, Inc.&nbsp;(NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/fb#NASDAQ">FB</a>) quarter. He likes the stock long-term and it&#39;s a core holding for him.
Stephen Weiss is a buyer of Volkswagen AG (OTC: <a class="ticker" href="https://www.benzinga.com/stock/vwagy#OTC">VWAGY</a>). He said it&#39;s the cheapest electric vehicle producer in the world and it will be the largest producer next year.
Bryn Talkington would buy Coinbase Global Inc (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/coin#NASDAQ">COIN</a>) and sell the $270 calls, collecting $20.
Rob Sechan wants to buy Invesco S&amp;P 500 Equal Weight Consumer Discretionary ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/rcd#NYSE">RCD</a>).

'Fast Money Halftime Report' Picks For May 21

Matt Boss, JPMorgan's retail analyst, was a guest on <a href="http://video.cnbc.com/gallery/?video=3000567097">CNBC</a> Thursday afternoon to offer his take on the state of the retail market. The analyst quickly pointed out that the retail sector has now lapsed the most worrying week of the year with the U.S. election.
"There is no question that some of this uncertainty held the consumer back in the third quarter &mdash; it's hard to parse through the noise," he said. "We had really bad weather in the third quarter, it was much warmer year-over-year so that was an aspect for a lot of the apparel retailers."
Meanwhile, the analyst believes that department stores have delivered <a href="http://www.benzinga.com/news/earnings/16/11/8680543/q3-a-mixed-bag-for-department-store-stocks-so-far">encouraging earnings reports</a> and the off-price retailers are on deck to report next week.
Boss continued that the retail sector will likely benefit in the fourth quarter and first quarter of 2017 from easy year-over-year compares, especially on the traffic aspect so the sector could see more optimism.
<h3>Retailer Sector Post-Election</h3>
Boss stated that post-election the retail sector as a whole could benefit from lower corporate tax rates under President-elect <a href="http://www.benzinga.com/topic/donald-trump">Donald Trump</a>, while the consumer could also benefit from a reduction in personal tax rates.
He shied away from offering any specific recommendation but did say that the "inspirational consumer" could be shopping more in 2017.
<h3>Relevant ETFs And Trusts</h3>
<ul>
<li>VanEck Vectors Retail ETF (NYSE: <a class="ticker" href="/stock/rth#NYSE">RTH</a>).</li>
<li>SPDR S&amp;P Retail (ETF) (NYSE: <a class="ticker" href="/stock/xrt#NYSE">XRT</a>).</li>
<li>Consumer Discretionary SPDR (ETF) (NYSE: <a class="ticker" href="/stock/xly#NYSE">XLY</a>).</li>
<li>Guggenheim S&amp;P Equal Weight Consumer Discretionary ETF (NYSE: <a class="ticker" href="/stock/rcd#NYSE">RCD</a>).</li>
<li>Vanguard Consumer Discretionary ETF (NYSE: <a class="ticker" href="/stock/vcr#NYSE">VCR</a>).</li>
<li>PowerShares Dynamic Retail (ETF) (NYSE: <a class="ticker" href="/stock/pmr#NYSE">PMR</a>).</li>
<li>First Trust Cnsmer Disry Alpha Fnd (ETF) (NYSE: <a class="ticker" href="/stock/fxd#NYSE">FXD</a>).</li>
<li>iShares Dow Jones US Consumer Ser. (ETF) (NYSE: <a class="ticker" href="/stock/iyc#NYSE">IYC</a>).</li>
</ul>

JPMorgan's Retail Analyst: Trump, Warm Weather And The Back Half Of 2016

Arguably, depending on one&#39;s regional preferences, the greatest rapper of all-time died on March 9, 1997. What cannot be debated is that one of the worst bear markets in stocks died on March 9, 2010. The subsequent bull market, now seven years old, has been a boon for the growth of the exchange-traded funds industry.
In terms of capital appreciation, however, no non-leveraged ETF can keep up with the Guggenheim Invest S&amp;P 500 Pure Value ETF (NYSE: <a class="ticker" href="/stock/rpv#NYSE">RPV</a>) since the start of the current bull market.
<h3>Honing In On RPV</h3>
From March 10, 2009, through March 8, 2016, RPV returned an astounding 521.2 percent, good for annualized returns of nearly 30 percent, according to Morningstar data. Over that period, RPV turned a $10,000 investment into more than $62,100.
RPV is part of six-ETF suite of pure style ETFs issued by Guggenheim. All six of those ETFs rank among the top 54 non-leveraged ETFs since the birth of the current bull market.
<bzrelatedlink>Related Link: <a href="http://www.benzinga.com/analyst-ratings/analyst-color/16/03/7314379/happy-birthday-bull-market-youre-7-years-old">Happy Birthday, Bull Market: You're 7 Years Old</a></bzrelatedlink>
RPV, home to nearly $694 million in assets under management and a five-star Morningstar rating, holds 114 stocks. Nearly a quarter of those hail from the financial services sector while a third of RPV&#39;s combined weight is allocated to consumer discretionary and utilities names.
<h3>Small-Cap Equivalent To RPV</h3>
RPV has a small-cap equivalent, the Rydex S&amp;P SmallCap 600 Pure Value ETF (NYSE: <a class="ticker" href="/stock/rzv#NYSE">RZV</a>). It is probably not a coincidence that RZV is the second best non-leveraged behind RPV since the bull market started in March 2009. RZV is up 489.4 percent from March 10, 2009, through March 8, 2016, good for average annualized returns of 28.9 percent, according Morningstar data. A $10,000 investment in RZV on March 10, 2016 would be worth over $58,000 today.
Guggenheim has 17 of the best-performing non-leveraged ETFs since the start of the current bull market. Only iShares with 24 has more. Said another way, Guggenheim has more than twice as many of the best-performing non-leveraged ETFs during the current bull market than does Vanguard.
Knowing that, perhaps it is not surprising to learn that the best non-leveraged sector ETF, and third-best non-leveraged ETF, overall during this bull market also hails from the Guggenheim family: The Rydex S&amp;P Equal Weight Consumer Dis ETF (NYSE: <a class="ticker" href="/stock/rcd#NYSE">RCD</a>). 
<h3>Don't Ignore RCD</h3>
Many investors know that the consumer discretionary sector has been on a tear since the end of the global financial crisis and that run has been aided <a href="http://www.benzinga.com/trading-ideas/long-ideas/16/02/6211908/this-industry-etf-could-work-this-year">in large part</a> by stocks such as Amazon.com, Inc. (NASDAQ: <a class="ticker" href="/stock/amzn#NASDAQ">AMZN</a>), Netflix, Inc. (NASDAQ: <a class="ticker" href="/stock/nflx#NASDAQ">NFLX</a>) and Dow component Walt Disney Co (NYSE: <a class="ticker" href="/stock/dis#NYSE">DIS</a>).
RCD deserves some love for returning 478 percent over the past seven years because those stocks combine for just 3.1 percent <a href="http://guggenheiminvestments.com/products/etf/details?productId=95">of the ETF&#39;s weight</a>. 
Image Credit: <a href="https://pixabay.com/en/india-buffalo-bison-asia-gaur-1136138/">Public Domain</a>

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The Best ETF Since The Start Of The Bull Market Is...

Broadly speaking, U.S. economic data released this year has been solid. Of course there have been hiccups along the way, a slightly higher unemployment rate seen in last Friday's May jobs report is one example, but overall the data have been decent.

	Improving data points have included some good news regarding U.S. consumers, or those folks that drive 70 percent of this country's GDP. Chipper consumers have meant good things for discretionary and retail ETFs, a conversation that often revolves around a small number of ETFs such as the Consumer Discretionary Select Sector SPDR (NYSE: <a class="ticker" href="/stock/xly#NYSE">XLY</a>) and the SPDR S&amp;P Retail ETF (NYSE: <a class="ticker" href="/stock/xrt#NYSE">XRT</a>).

	Good choices to be sure as XLY, the largest discretionary ETF, is up 17.4 percent year-to-date. XRT, which takes an equal-weight approach to the retail sub-sector, has surged nearly 25 percent. Not every discretionary ETF <a href="http://www.benzinga.com/trading-ideas/long-ideas/13/06/3651928/if-analysts-are-right-casino-etf-could-keep-winning">gets the attention it deserves</a> and with that in mind, here are few such funds to consider should consumer data keep improving.

	PowerShares S&amp;P SmallCap Consumer Discretionary Portfolio (NASDAQ: <a class="ticker" href="/stock/pscd#NASDAQ">PSCD</a>) 
	In the essence of brevity, the PowerShares S&amp;P SmallCap Consumer Discretionary Portfolio is the small-cap equivalent of XLY, obviously courtesy of a different issuer. The PowerShares offering gives investors exposure to retail, automotive, leisure and recreation, media and real estate. PSCD's 106-stock lineup has rewarded investors this year with a gain of 21 percent.

	This is another one of those ETFs that know-it-alls that are in love with superficial evaluation tools such as assets under management would tell investors to stay away from. Indeed, PSCD has just $77.4 million in AUM, but its year-to-date returns indicate staying away from this ETF on that basis was a dumb move.

	PSCD's largest holdings are heavily traded and the ETF rarely trades at noticeable premiums or discounts to its net asset value, <a href="http://www.invescopowershares.com/products/overview.aspx?ticker=PSCD">according to PowerShares data</a>, indicating the fund is sufficiently liquid.

	First Trust Consumer Discretionary AlphaDEX Fund (NYSE: <a class="ticker" href="/stock/fxd#NYSE">FXD</a>) 
	The First Trust Consumer Discretionary AlphaDEX Fund follows the same path as <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/10/2971334/alphadex-etfs-do-things-differently-with-stellar-results">as the other AlphaDEX ETFs</a> and that can work in favor of investors in the right market environment. For example, FXD is up 35 percent in the past year compared to 33 percent for XLY.

	Like the other AlphaDEX funds, FXD eschews weighting by market cap in favor of a focus on a value and growth factors. The result is a lineup of 125 stocks with none receiving a weight north of 1.62 percent. Top-10 holdings include Guess (NYSE: <a class="ticker" href="/stock/ges#NYSE">GES</a>), General Motors (NYSE: <a class="ticker" href="/stock/gm#NYSE">GM</a>) and Pandora (NYSE: <a class="ticker" href="/stock/p#NYSE">P</a>).

	FXD, which has almost $625 million in assets under management, allocates more than 38 percent of its combined weight to media and specialty retail names. The one drawback here is that the ETF's three-year standard deviation is about 300 basis points higher than the S&amp;P 500 Consumer Discretionary Index's, <a href="http://www.ftportfolios.com/Retail/Etf/EtfSummary.aspx?Ticker=FXD">according to First Trust data</a>.

	Guggenheim S&amp;P 500 Equal-Weight Consumer Discretionary ETF (NYSE: <a class="ticker" href="/stock/rcd#NYSE">RCD</a>) 
	As is the case with the AlphaDEX funds, there are times when equal-weight sector ETFs outpace their cap-weighted rivals. The $61.8 million RCD has been doing that (compared to XLY) over the past year. RCD is dominated by the specialty retail, media and hotel and restaurant sub-sectors with those groups combining for about 54 percent of the fund's weight.

	Holdings include Best Buy (NYSE: <a class="ticker" href="/stock/bby#NYSE">BBY</a>), Coach (NYSE: <a class="ticker" href="/stock/coh#NYSE">COH</a>) and Wynn Resorts (NASDAQ: <a class="ticker" href="/stock/wynn#NASDAQ">WYNN</a>). RCD's expense ratio of 0.5 percent per year is nearly triple that of XLY's, and like FXD, RCD is also slightly more volatile than XLY.

	For more on ETFs, click <a href="http://www.benzinga.com/etfs">here</a>.

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Three Discretionary ETFs Your Broker Forgot to Mention (PSCD, FXD, RCD)

The Consumer Discretionary sector ranks seventh out of the ten sectors as detailed in my <a href="http://blog.newconstructs.com/2012/10/08/sector-rankings-for-etfs-mutual-funds/">Sector Rankings for ETFs and Mutual Funds</a>. It gets my Neutral rating, which is based on aggregation of ratings of 17 ETFs and 27 mutual funds in the Consumer Discretionary sector as of October 10, 2012. Prior reports on the best &amp; worst ETFs and mutual funds in every sector and style are <a href="http://www.newconstructs.com/nc/research/report/etf-and-fund-reports.htm">here</a>.

	Figure 1 ranks from best to worst the nine Consumer Discretionary ETFs that meet our liquidity standards and Figure 2 shows the five best and worst-rated Consumer Discretionary mutual funds. Not all Consumer Discretionary sector ETFs and mutual funds are created the same. The number of holdings varies widely (from 25 to 372), which creates drastically different investment implications and ratings. The best ETFs and mutual funds allocate more value to Attractive-or-better-rated stocks than the worst ETFs and mutual funds, which allocate too much value to Neutral-or-worse-rated stocks.

	To <a href="http://blog.newconstructs.com/2012/10/09/how-to-find-the-best-etfs-2/">identify the best</a> and <a href="http://blog.newconstructs.com/2012/04/05/how-to-avoid-the-worst-etfs/">avoid the worst</a> ETFs and mutual funds within the Consumer Discretionary sector, investors need a <a href="http://blog.newconstructs.com/2011/11/23/predictive-fund-rating-methodology/">predictive rating</a> based on (1) <a href="http://blog.newconstructs.com/2011/11/22/portfolio-management-rating-methodology/">stocks ratings</a> of the holdings and (2) the <a href="http://blog.newconstructs.com/2011/10/28/total-annual-costs-methodology/">all-in expenses</a> of each ETF and mutual fund. Investors need not rely on backward-looking ratings. My fund rating methodology is detailed <a href="http://blog.newconstructs.com/2011/11/23/predictive-fund-rating-methodology/">here</a>.

	Investors should not buy any Consumer Discretionary ETFs or mutual funds because none get an Attractive-or-better rating. If you must have exposure to this sector, you should buy a basket of Attractive-or-better rated stocks and avoid paying undeserved fund fees. Active management has a <a href="http://blog.newconstructs.com/2012/09/17/less-than-1-of-managers-deliver-alpha-here-are-details/">long history</a> of not paying off.

	Get my ratings on all ETFs and mutual funds in this sector on my free <a href="http://www.newconstructs.com/nc/fundscreener/fund-screener.htm">mutual fund and ETF screener</a>.
<div>

		Figure 1: ETFs with the Best &amp; Worst Ratings
</div>

	<a href="http://blog.newconstructs.com/wp-content/uploads/2012/10/ConsumerDiscFig11.jpg"><img alt="" class="aligncenter size-full wp-image-4723" height="212" src="http://blog.newconstructs.com/wp-content/uploads/2012/10/ConsumerDiscFig11.jpg" title="ConsumerDiscFig1" width="333" /></a>

	* Best ETFs exclude ETFs with TNA&rsquo;s less than $100 million for inadequate liquidity.
<div>

		Sources: New Constructs, LLC and company filings
</div>

	Rydex S&amp;P Equal Weight Consumer Discretionary (NYSE: <a class="ticker" href="/stock/rcd#NYSE">RCD</a>), PowerShares Dynamic Consumer Discretionary (NYSE: <a class="ticker" href="/stock/pez#NYSE">PEZ</a>), and Market Vectors Retail ETF (NYSE: <a class="ticker" href="/stock/rth#NYSE">RTH</a>) are excluded from Figure 1 because their total net assets (TNA) are below $100 million and do not meet our liquidity standards.
<div>

		Figure 2: Mutual Funds with the Best &amp; Worst Ratings &ndash; Top 5
</div>

	<a href="http://blog.newconstructs.com/wp-content/uploads/2012/10/ConsumerDiscFig21.jpg"><img alt="" class="aligncenter size-full wp-image-4722" height="207" src="http://blog.newconstructs.com/wp-content/uploads/2012/10/ConsumerDiscFig21.jpg" title="ConsumerDiscFig2" width="369" /></a>

	* Best mutual funds exclude funds with TNA&rsquo;s less than $100 million for inadequate liquidity.
<div>

		Sources: New Constructs, LLC and company filings
</div>

	ICON Funds: ICON Consumer Discretionary Fund (NYSE: ICCCX) and Fidelity Advisor Series VII: Fidelity Advisor Consumer Discretionary Fund (FCNIX) are excluded from Figure 2 because their total net assets (TNA) are below $100 million and do not meet our liquidity standards.

	Consumer Discretionary Select Sector SPDR (NYSE: <a class="ticker" href="/stock/xly#NYSE">XLY</a>) is my top-rated Consumer Discretionary ETF and Vanguard World Funds: Vanguard Consumer Discretionary Index Fund (NYSE: <a class="ticker" href="/stock/vcdax#NYSE">VCDAX</a>) is my top-rated Consumer Discretionary mutual fund. Both earn my Neutral rating.

	PowerShares Dynamic Build &amp; Construction (NYSE: <a class="ticker" href="/stock/pkb#NYSE">PKB</a>) is my worst-rated Consumer Discretionary ETF and Rydex Series Funds: Retailing Fund (RYRTX) is my worst-rated Consumer Discretionary mutual fund. Both earn my Dangerous rating.

	Figure 3 shows that 122 out of the 450 stocks (about 28% of the total net assets) held by Consumer Discretionary ETFs and mutual funds get an Attractive-or-better rating. However, not a single Consumer Discretionary ETF or mutual fund earns an Attractive-or-better rating. The reason is that the majority (about 72%) of assets held by Consumer Discretionary ETFs and mutual funds is allocated to Neutral or Dangerous-rated stocks.

	The takeaways is: mutual fund managers allocate too much capital to low-quality stocks and Consumer Discretionary ETFs hold poor quality stocks.
<div>

		Figure 3: Consumer Discretionary Sector Landscape For ETFs, Mutual Funds &amp; Stocks
</div>
<div>

		<a href="http://blog.newconstructs.com/wp-content/uploads/2012/10/ConsumerDiscFig3.jpg"><img alt="" class="aligncenter size-full wp-image-4718" height="145" src="http://blog.newconstructs.com/wp-content/uploads/2012/10/ConsumerDiscFig3.jpg" title="ConsumerDiscFig3" width="423" /></a>

		Sources: New Constructs, LLC and company filings
</div>

	As detailed in &ldquo;<a href="http://blog.newconstructs.com/2012/07/20/low-cost-funds-dupe-investors-2/">Cheap Funds Dupe Investors</a>&rdquo;, the fund industry offers many cheap funds but very few funds with high-quality stocks, or with what I call good <a href="http://blog.newconstructs.com/2011/11/22/portfolio-management-rating-methodology/">portfolio management</a>.

	Investors need to tread carefully when considering Consumer Discretionary ETFs and mutual funds, because not a single one is rated Attractive or better. As you can see in Figure 3, 98% of assets invested in Consumer Discretionary mutual funds are held in Neutral-rated funds, and only 2% are in Dangerous funds. Investors have therefore done well to avoid the worst of the Consumer Discretionary mutual funds. However, even a Neutral-rated fund exposes investors to unattractive stocks, as well as the fees charged by active management. Why pay a manager to select unattractive stocks? Investors should not buy any Consumer Discretionary ETFs or mutual funds and instead should focus on owning a basket of Attractive-or-better-rated stocks.

	Ford Motors (NYSE: <a class="ticker" href="/stock/f#NYSE">F</a>) is a great example of an Attractive-or-better-rated Consumer Discretionary stock.Iit earns my Very Attractive rating. Let&rsquo;s make no mistake about it, the American auto industry went through the ringer during the financial crisis, but Ford was better positioned than its rivals and emerged from the fracas as the clear leader of the American auto pack. Ford is ahead of it peers in increasing operational efficiency, closing outdated factories, and cutting-edge design and engineering. The result is a line of cars and trucks that is not only meeting consumer&rsquo;s demands and generating profits for the company.Ford is now more profitable than ever. During the period 2004-2009, Ford&rsquo;s average <a href="http://www.newconstructs.com/nc/help/glossary.htm#roicDef">return on invested capital</a> was a value-destroying -.85%. In 2010 Ford earned 11.6% ROIC and followed that up with 12.6% in 2011. This is a company that took advantage of a downturn to focus on capital stewardship, efficiency, and profitability. Best of all, the market has not caught on to Ford&rsquo;s new value-generating engine. The current valuation as of 10/10/12, $10.10/share, implies that Ford&rsquo;s profits will permanently decline by 59%. The mismatch between Ford&rsquo;s profitability and growing cash flows and the market&rsquo;s pessimistic valuation earn F a Very Attractive rating.

	Haverty Furniture Companies (NYSE: <a class="ticker" href="/stock/hvt#NYSE">HVT</a>) is one of my least favorite stocks held by Consumer Discretionary ETFs and mutual funds and earns my Very Dangerous rating. Haverty Furniture is not a very profitable company. Their <a href="http://www.newconstructs.com/nc/help/glossary.htm#roicDef">ROIC</a> has not exceeded their <a href="http://www.newconstructs.com/nc/help/glossary.htm#helpWacc">cost of capital</a> in a single year of my model, and has been stuck below 5% since 2005. Those low returns mean that HVT is destroying shareholder value every single year. From 2010 to 2011, HVT&rsquo;s <a href="http://www.newconstructs.com/nc/help/glossary.htm#nopat">NOPAT</a> decreased from $20.0 million to $16.6 million. Some investors may have been fooled by their accounting bottom line, however. HVT&rsquo;s Net Income increased from $8.44 million to $15.46. The reason for their accounting improvement is a non-recurring tax benefit of $14.1 million due to the reversal of the valuation allowance for their Deferred Tax Assets. Investors should not count on seeing a benefit like that again any time soon. The disconnect between HVT&rsquo;s reported Net Income and their true operating profits is one of the reasons the company gets my Very Dangerous rating.

	468 stocks of the 3000+ I cover are classified as Consumer Discretionary stocks, but Consumer Discretionary ETFs and mutual funds hold only 450 stocks.

	Figures 4 and 5 show the rating landscape of all Consumer Discretionary ETFs and mutual funds.

	Our <a href="http://blog.newconstructs.com/2012/10/08/sector-rankings-for-etfs-mutual-funds/">Sector Rankings for ETFs and Mutual Funds</a> report ranks all sectors and highlights those that offer the best investments.
<div>

		Figure 4: Separating the Best ETFs From the Worst ETFs
</div>

	<a href="http://blog.newconstructs.com/wp-content/uploads/2012/10/ConsumerDiscFig4.jpg"><img alt="" class="aligncenter size-full wp-image-4717" height="245" src="http://blog.newconstructs.com/wp-content/uploads/2012/10/ConsumerDiscFig4.jpg" title="ConsumerDiscFig4" width="409" /></a>

	Sources: New Constructs, LLC and company filings
<div>

		Figure 5: Separating the Best Mutual Funds From the Worst Mutual Funds
</div>
<div>

		<a href="http://blog.newconstructs.com/wp-content/uploads/2012/10/ConsumerDiscFig5.jpg"><img alt="" class="aligncenter size-full wp-image-4716" height="245" src="http://blog.newconstructs.com/wp-content/uploads/2012/10/ConsumerDiscFig5.jpg" title="ConsumerDiscFig5" width="409" /></a>

		Sources: New Constructs, LLC and company filings
</div>

	Review my <a href="http://www.newconstructs.com/nc/fundscreener/fund-screener.htm?task=ACTION_CATEGORY_TYPE_SEARCH&amp;selectedTypes=0,1&amp;selectedCategoryIds=5d891c2e114e11e190ae00188b533b34">full list</a> of ratings and rankings along with reports on all 17 ETFs and 27 mutual funds in the Consumer Discretionary sector.

	Disclosure: I own F. I receive no compensation to write about any specific stock, sector or&nbsp;theme.

PowerShares Dynamicnsumer Discretionary Sector Portfolio

PowerShares ETF Trust Dynamic Building &nstruction Portfolio

VCDAX

Best & Worst ETFs & Mutual Funds: Consumer Discretionary Sector

Gannett (NYSE: <a class="ticker" href="/stock/gci#NYSE">GCI</a>) is scheduled to report second-quarter 2012 results Monday, July 16, before the U.S. markets open. The international news and information company has seen its revenue fall over the past four quarters, 

Expectations

Analysts on average predict that Gannett will report per-share earnings of $0.53 for the quarter and say that its revenue will total about $1.3 billion. In the same period of last year, the company reported $0.58 per share and $1.3 billion in revenue. Note that the earnings per share (EPS) estimate has remained the same over the past 60 days. And Gannett has not fallen short of consensus EPS estimates in the past ten quarters. The positive surprise in the first quarter was 9.7 percent.

Though the company beat earnings expectations in the previous quarter, both net income and revenue declined year-over-year because of a slump in publishing advertising demand and a marginal fall in circulation revenue. However, the company said broadcasting revenue rose 7.5 percent on robust advertising demand, including cyclical political advertising demand. The company suggested it may initiate a subscription-based model in some markets, as well as expand its USA Today Sports Media Group. Shares fell about 8 percent following the first-quarter report.

Earnings growth is forecast for the current quarter, however, with EPS up 12 percent to $0.50 per share. Revenues are expected to rise 2.6 percent from a year ago to $1.3 billion. So far, analysts expect full-year earnings-per-share and revenue to be marginally higher than in the previous year.

The Company

Gannett's Publishing segment publishes 82 U.S. daily newspapers and affiliated online sites, including USA TODAY, Clipper Magazine, NurseWeek and military and defense newspapers. The Digital segment owns and operates CareerBuilder, ShopLocal, Planet Discover and others. Its Broadcasting segment operates 23 television stations and affiliated websites, as well as a network that delivers programming and advertising on video screens located in elevators of office towers and in hotel lobbies. The company was founded in 1906 and is headquartered in McLean, Va. It is an S&amp;P 500 component with a market capitalization of about $3.4 billion. That is greater than the market caps of competitors McClatchy (NYSE: <a class="ticker" href="/stock/mni#NYSE">MNI</a>) and New York Times (NYSE: <a class="ticker" href="/stock/nyt#NYSE">NYT</a>), but less than that of News Corp. (NYSE: <a class="ticker" href="/stock/nws#NYSE">NWS</a>).

During the three months that ended in June, Gannett named a new president and publisher of USA Today, as well as a new head of corporate communications and a new chief financial officer. Also, a series in USA Today was a finalist for a Pulitzer prize.

Performance

Gannett's long-term EPS growth forecast is a modest 6 percent, but that compares to a loss of more than 16 percent over the past five years. Its price-to-earnings (P/E) ratio is less than the industry average, and its operating margin greater than the industry average. The return on equity is almost 19 percent, which is higher than those of News Corp. and New York Times. But short interest is more than 10 percent of the float, though that is less than for McClatchy and New York Times. Of analysts who follow the stock, seven out of 12 rate it a Hold, five a Buy, and none recommend selling. Their mean price target is about 14 percent higher than the current share price.

Shares have traded mostly between $12 and $16 this year, as well as between $10 and $18 since late 2009; the stock bottomed in spring of that year. The share price is currently more than 15 percent higher over the past month, but more than 5 percent below the 52-week high. It is also above both the 200-day and 50-day moving averages. Over the past six months, the stock has outperformed McClatchy and New York Times, but underperformed the S&amp;P 500.

<div id="action-items">ACTION ITEMS

Bullish:

Investors interested in exchange traded funds invested in Gannett might want to consider the following trades:

<ul><li>PowerShares Dynamic Media (NYSE: <a class="ticker" href="/stock/pbs#NYSE">PBS</a>) is more than 10 percent higher year to date.</li>
<li>Rydex S&amp;P Equal Weight Consumer Discretionary (NYSE: <a class="ticker" href="/stock/rcd#NYSE">RCD</a>) is more than 9 percent higher year to date.</li>
<li>Vanguard Total Stock Market ETF (NYSE: <a class="ticker" href="/stock/vti#NYSE">VTI</a>) is more than 7 percent higher year to date.</li>
<li>iShares Russell 1000 Value Index (NYSE: <a class="ticker" href="/stock/iwd#NYSE">IWD</a>) is more than 6 percent higher year to date.</li>
</ul>Bearish:


Traders may prefer to consider the following alternative positions in the same industry. Note that they are all small cap companies.

<ul><li>Lee Enterprises (NYSE: <a class="ticker" href="/stock/lee#NYSE">LEE</a>) is up more than 120 percent year to date.</li>
<li>Daily Journal (NASDAQ: <a class="ticker" href="/stock/djco#NASDAQ">DJCO</a>) is up more than 38 percent year to date.</li>
<li>Journal Communications (NYSE: <a class="ticker" href="/stock/jrn#NYSE">JRN</a>) is up more than 21 percent year to date.</li>
</ul>Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.</div>

Earnings

Previews

DJCO

Gannett Earnings Preview: Flat Revenue Expected for Q2 and Beyond

Goodyear Tire &amp; Rubber (NYSE: <a class="ticker" href="/stock/gt#NYSE">GT</a>) must overcome $3.7 billion in underfunded pensions plus $6.3 billion in debt ($1.1 billion of which is off balance sheet) before investors could see any upside.

	Somewhat aggressive accounting for its &quot;U.S.&quot; and &quot;Non-U.S. Pensions&quot; and &quot;Other Postretirement Benefit&quot; plans (&quot;pensions&quot;) understates the gravity of pensions in their reported earnings. However, Goodyear has been very forthright in discussing the cash flow implications of their underfunded pensions.

	Contrary to Delta Airlines (NYSE: <a class="ticker" href="/stock/dal#NYSE">DAL</a>) and other firms we contacted, GT&#39;s IR department was quite willing to answer my questions about their pensions liabilities. More on <a href="http://blog.newconstructs.com/2012/05/18/bail-out-of-dal-before-the-stock-crashes/" target="_blank">DAL&#39;s looming pensions issues</a>.

	The company&#39;s stated plans to pay down its off-balance sheet liabilities depend on a fairly positive long-term economic outlook.

	I think management at Goodyear is well-aware of their off-balance sheet issues and is taking steps to address them. However, if business headwinds persist, they simply may not have the cash flow required to overcome their pension liabilities.

	If business does not remain buoyant, I think GT&#39;s earnings estimates will have to be lowered to reflect the looming pension liabilities.

	Abnormal Pension Accounting Boosts EPS

	GT boosted its 2011 earnings with a higher-than-average expected return on plan assets (&quot;EROPA&quot;) assumption for its pensions of 7.70<a href="http://blog.newconstructs.com/2012/06/12/pensions-weigh-on-goodyear-gt-stock-potential/#_ftn1" rel="nofollow" target="_blank">[1]</a>%, down from 7.82% in 2010. <a href="http://blog.newconstructs.com/wp-content/uploads/2012/05/GT_EROPAssumptions_NewConstructsModel.pdf" rel="nofollow" target="_blank">Page 95 in GT&#39;s 2011 10-K filing</a> has the details.

	An EROPA of 7.70% is abnormally high. Out of the 1,021 companies with pensions that I cover, 63% of them have a lower EROPA. Only 96 of the 1,021 raised their EROPAs in 2012 while 525 lowered and 400 made no changes.

	The 2012 EROPA looks a bit high compared to my estimates of the company&#39;s actual return on plan assets. I estimate 2011&#39;s actual return on plan assets was 3.19%. I estimate the average return over the last five years is 4.33%, over the past 10 years it is 6.40%, since 1998 it is 6.55%. These estimates are based on dividing the &quot;Actual return on plan assets&quot; by the &quot;Beginning balance&quot; of plan assets after adjustments suggested by GT&#39;s IR contact, Mike McCormick. You can replicate my analysis using data from the company&#39;s annual reports as detailed in <a href="http://blog.newconstructs.com/wp-content/uploads/2012/06/GT_actualReturnsOnPlanAssets2011-1998_wXtraDetail1.xlsx" rel="nofollow" target="_blank">the model used to calculate the actual return on plan assets</a>, which is based on data from the <a href="http://blog.newconstructs.com/wp-content/uploads/2012/05/GT_actualReturnonPlanAssetsSourceData_2011.pdf" rel="nofollow" target="_blank">2011</a>, <a href="http://blog.newconstructs.com/wp-content/uploads/2012/05/GT_actualReturnonPlanAssetsSourceData_2010.pdf" rel="nofollow" target="_blank">2010</a>, <a href="http://blog.newconstructs.com/wp-content/uploads/2012/05/GT_actualReturnonPlanAssetsSourceData_2009.pdf" rel="nofollow" target="_blank">2009</a>, <a href="http://blog.newconstructs.com/wp-content/uploads/2012/05/GT_actualReturnonPlanAssetsSourceData_2008.pdf" rel="nofollow" target="_blank">2008</a>, <a href="http://blog.newconstructs.com/wp-content/uploads/2012/05/GT_actualReturnonPlanAssetsSourceData_2007.pdf" rel="nofollow" target="_blank">2007</a> and <a href="http://blog.newconstructs.com/wp-content/uploads/2012/06/GT_actualReturnonPlanAssetsSourceData_2006-1998.pdf" rel="nofollow" target="_blank">2006-and prior</a> 10-Ks.

	Accounting Lowers Pension Expenses &amp; Has Big Impact On EPS

	Since GT&#39;s pensions are so large, its pension costs play a prominent role in earnings, much more so than most companies. GT&#39;s net periodic benefit cost after tax (the cost attributable to pensions with the current EROPA reported in GAAP earnings) is over 62% of 2011&#39;s net income.

	Assuming a high EROPA enables GT to lower the costs it must report in earnings for paying into its pensions. In turn, the company&#39;s overall expenses are lower and accounting earnings are higher.

	A 1% decrease in GT&#39;s EROPA would wipe away 7% of the company&#39;s 2011 net income, $35 million increase in pre-tax earnings, or $0.088 per basic shares outstanding. A 1% reduction to a 6.7% EROPA would be below the median (7.5%) EROPA for the 1,021 pensions we analyzed.

	I think it is fair to say that GT is stretching the limits of its EROPA, which props up earnings.

	Pensions Are Already Underfunded by $3.7 billion

	One could argue that stretching the limits of EROPA and minimizing the amount of money it pays into its pensions is a fair and good strategy for a company whose pensions were adequately funded. That argument does not hold for GT as its pensions were under-funded by $3.7 billion as of 12/31/2011. The sum of the &quot;net funded status&quot; for the U.S., Non-U.S. and Other Postretirement Benefits&quot; on page <a href="http://blog.newconstructs.com/wp-content/uploads/2012/05/GT_actualReturnonPlanAssetsSourceData_2011.pdf" rel="nofollow" target="_blank">93 of the company&#39;s 2011 10-K</a> shows where I get the $3.7 billion value, which is about 1.5 times the company&#39;s market cap.

	Doubtful That GT Can Grow Its Way Out Of Its Liabilities

	If GT were in a high growth industry with excellent prospects for future profits, one could argue that the company could easily earn its way out of the underfunded pensions hole. That is a tough argument for a company in such a competitive and low margin business in a challenging economic environment.

	Despite reporting profitable GAAP accounting profits, my more comprehensive model suggests that GT is an unprofitable business even if one assumes its EROPA is fair and accurate. Figure 1 compares GT&#39;s economic earnings to its accounting earnings. In 2011, GT reported $321 million in accounting profit while I believe the company&#39;s true cash flows were closer to -$341 million.

	Figure 1: Accounting Profits Are Rosy Too&hellip;Sustainable?

	<img src="http://static.cdn-seekingalpha.com/uploads/2012/7/11/saupload_GT1.jpg" />

	Sources: New Constructs, LLC and company filings

	One of the largest drivers of the differences in reported accounting and <a href="http://blog.newconstructs.com/2010/08/05/economic-versus-accounting-earnings/" rel="nofollow" target="_blank">economic earnings</a> for GT is $1.1 billion in off-balance sheet debt from operating leases (about 45% of the company&#39;s market cap). In addition, Goodyear is in a very capital-intensive business and generates relatively little cash compared to the amount of <a href="http://www.newconstructs.com/nc/help/glossary.htm#investedCapital" rel="nofollow" target="_blank">invested capital</a> in the business.

	From where I sit, the company is in a tough situation. It is not making much, if any, money and its liabilities are formidable: pensions at $3.7 billion plus total debt of $6.3 billion equals $10 billion.

	Equity Value Depressed By Growing Pension &amp; Debt Liabilities

	Last year, despite a significant increase in EPS compared to the prior year, the underfunded status of GT&#39;s pensions grew from $3.1 billion at the end of 2010 to $3.7 billion at the end of 2011.

	Even if GT&#39;s liabilities do not increase, equity investors should be intimidated by the $10 billion in existing liabilities that have a senior claim on Goodyear&#39;s future profits. If Goodyear does generate future profits, those profits have to be large enough to cover the $10 billion in senior claims plus the expectations baked into the current stock price before equity investors can make significant money in GT.

	$10 billion is more than 31 times GT&#39;s 2011 net income. Equity investors may be at the end of a very long line when it comes to expecting a payout from GT.

	Stock Valuation Is Oblivious To Looming Liabilities

	For those that say all of this information is already baked into the stock price, I suggest you look again. According to my discounted cash flow model, to justify the stock valuation at $10.83/share, the company has to grow its after-tax cash flow (<a href="http://www.newconstructs.com/nc/help/glossary.htm#nopat" rel="nofollow" target="_blank">NOPAT</a>) by 4% compounded annually for 10 years. I underscore that those are the expectations baked into the current stock price. For investors to believe GT deserves a higher valuation/stock price, they must believe that the company&#39;s future profit growth will be even greater than that baked into the current stock price.

	Footnotes Diligence Pays

	In summary, using the footnotes to lift the accounting veil on GT&#39;s financial situation reveals some earnings and liabilities issues for a stock that is fairly expensive and could suffer downward pressure when investors concerned about these issues.

	Avoid ETFs and Mutual Funds That Hold GT

	Here is a list of the ETFs and mutual funds (as of June 12) that allocate the most to GT. Get free reports on these funds from my free <a href="http://bit.ly/Locx5k" rel="nofollow" target="_blank">mutual fund and ETF screener</a>.

	Mutual funds
<ol>
<li>
		Investment Managers Series Trust: Towle Deep Value Fund (TDVFX) - Dangerous Rating</li>
<li>
		Unified Series Trust: IMS Capital Value Fund (IMSCX) - Dangerous Rating</li>
<li>
		LKCM Funds: LKCM Aquinas Value Fund (AQIEX) - Neutral Rating</li>
</ol>

	ETFs
<ol>
<li>
		Direxion All Cap Insider Sentiment Shares (NYSE: <a class="ticker" href="/stock/know#NYSE">KNOW</a>) - Neutral Rating</li>
<li>
		PowerShares S&amp;P 500 High Beta Portfolio (NYSE: <a class="ticker" href="/stock/sphb#NYSE">SPHB</a>) - Dangerous Rating</li>
<li>
		Rydex S&amp;P Equal Weight Consumer Discretionary (NYSE: <a class="ticker" href="/stock/rcd#NYSE">RCD</a>) - Neutral Rating</li>
</ol>

	Disclosure: I receive no compensation to write about any specific stock or theme.
<hr />

	<a href="http://blog.newconstructs.com/2012/06/12/pensions-weigh-on-goodyear-gt-stock-potential/#_ftnref1" rel="nofollow" target="_blank">[1]</a> Value is the weighted average EROPA calculated using the average of the beginning and ending balance of the Fair Value of Plan Assets.

Financial Advisors

KNOW

SPHB

 Pensions Weigh On Goodyear Stock Potential 

CarMax (NYSE: <a class="ticker" href="/stock/kmx#NYSE">KMX</a>), the used-car retailer, is scheduled to report first-quarter fiscal 2013 results on June 21, before the U.S. markets open.

The company has seen net income rise in the previous three quarters and has enjoyed four-straight quarterly revenue increases. Investors will be hoping for these trends to continue, as well as watching for how fuel prices and the woes of automakers may have affected results.

See also: <a href="http://www.benzinga.com/analyst-ratings/analyst-color/12/06/2653722/ford-gm-feeling-europes-economic-despair">Ford and GM Feeling Europe's Economic Despair</a>

Expectations

Analysts predict that CarMax will report per-share earnings of $0.53 for the quarter and say that its revenue totaled $2.8 billion. In the same period of last year, the auto retailer reported $0.55 per share and $2.7 billion in sales. Note that the EPS estimate is one cent less that it was 60 days ago. CarMax exceeded consensus EPS estimates in the fourth quarter, but narrowly fell short in the two quarters before that. The positive surprise in the fourth quarter was one cent per share.

Back in that fourth-quarter report, the company offered up revenues of $2.5 billion and net earnings of $95 million, or $0.41 per diluted share. Both the top and bottom lines exceeded expectations. Same-store sales were up year-over-year for both the quarter and the full year. CarMax attributed the growth in sales to strong subprime financing, and also said that it expects to open 10 stores in 2012 and 10-15 stores in 2013.

See also: <a href="http://www.benzinga.com/news/earnings/12/04/2476231/carmax-q4-beats-estimates-on-strong-subprime-financing">CarMax Q4 Beats Estimates on Strong Subprime Financing</a>

The forecast for the current quarter has EPS and sales about the same as the first-quarter estimates, which would represent a revenue increase of 8.2% but flat earnings, compared to a year ago. So far, analysts expect fiscal 2013 per-share earnings and revenues to be up by single-digit percentages.

The Company

CarMax is primarily a retailer of used vehicles in the United States, with more than 110 locations in 55 markets. The company also sells new vehicles under franchise agreements with Chrysler, General Motors (NYSE: <a class="ticker" href="/stock/gm#NYSE">GM</a>), Nissan and Toyota (NYSE: <a class="ticker" href="/stock/tm#NYSE">TM</a>). It provides financing options to customers, as well as a range of other related products and services. It also sells cars to licensed dealers. CarMax was founded in 1993 and is headquartered in Richmond, Virginia. It is a component of the S&amp;P 500 and has a market cap of $6.5 billion.

Competitors include America's Car-Mart (NASDAQ: <a class="ticker" href="/stock/crmt#NASDAQ">CRMT</a>), AutoNation (NYSE: <a class="ticker" href="/stock/an#NYSE">AN</a>) and Penske Auto Group (NYSE: <a class="ticker" href="/stock/pag#NYSE">PAG</a>). In its most recent quarter report, America's Car-Mart topped consensus EPS expectations but revenues grew less than predicted. Analysts expect AutoNation and Penske to post solid EPS and sales growth when they report second-quarter results in July.

See also: <a href="http://www.benzinga.com/news/12/06/2639821/autonation-pops-as-new-vehicle-sales-increase-45">AutoNation Pops as New Vehicle Sales Increase 45%</a>

During the three months that ended in May, CarMax opened new stores in Bakersfield, California; Fort Myers, Florida; Lancaster, Pennsylvania, and other locations. It also announced that, in an effort to reduce energy consumption, it had installed solar panels in locations including Phoenix, Arizona; Irving, Texas, and Fort Worth, Texas.

Performance

CarMax's long-term earnings per share growth forecast is 12.5%. Its price-to-earnings ratio is higher than the industry average, but so is its operating margin. The return on investment is 16.8%, which is higher than those of its competitors. Short interest is 7.1% of the float. Ten of 15 analysts who follow the stock rate it a Buy or Strong Buy; none recommend selling shares. Their mean price target is more than 24% higher than the current price.

Trading near $28.50, shares are more than 6% lower than at the beginning of the year. Shares have pulled back more than 17% over the past quarter from near a 52-week high. The share price is below both the 200-day and 50-day moving averages. Over the past six months, the stock has underperformed the competitors mentioned above, as well as the broader markets.

<div id="action-items">ACTION ITEMS

Bullish: Investors interested in exchange traded funds (ETFs) invested in CarMax might want to consider the following. Over the past six months:

<ul><li>Guggenheim Sector Rotation (NYSE: <a class="ticker" href="/stock/xro#NYSE">XRO</a>) is trading more than 26% higher.</li>
<li>Consumer Discretionary Select Sector SPDR (NYSE: <a class="ticker" href="/stock/xly#NYSE">XLY</a>) is up nearly 17%.</li>
<li>Rydex S&amp;P Equal Weight Consumer Discretionary (NYSE: <a class="ticker" href="/stock/rcd#NYSE">RCD</a>) has rallied more than 15%.</li>
<li>SPDR S&amp;P Retail (NYSE: <a class="ticker" href="/stock/xrt#NYSE">XRT</a>) is up about 14%.</li>
</ul>Bearish: Traders may prefer to consider these alternative positions in the same industry. Over the past six months:

<ul><li>Asbury Automotive Group (NYSE: <a class="ticker" href="/stock/abg#NYSE">ABG</a>) is up more than 25%.</li>
<li>KAR Auction Services (NYSE: <a class="ticker" href="/stock/kar#NYSE">KAR</a>) is up about 23%.</li>
<li>Penske Automotive Group (NYSE: <a class="ticker" href="/stock/pag#NYSE">PAG</a>) is up about 22%.</li>
</ul>Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.</div>

Guidance

Movers

CRMT

CarMax Earnings Preview: Higher Sales, Lower EPS Expected

Darden Restaurants (NYSE: <a class="ticker" href="/stock/dri#NYSE">DRI</a>) is scheduled to report third-quarter fiscal 2012 results tomorrow, March 23, before the opening bell.

Though revenue has risen in the past four quarters, the company's net income has fallen in each of the past two quarters. The question for investors is what effect will the warmer-than-expected winter have had, as well as the Lenten season beginning in the third quarter this year? And food inflation has begun to moderate year over year, though prices are still high.

Expectations

Analysts predict that Darden Restaurants will report that per-share earnings came to $1.24 for the quarter and that revenue totaled $2.1 billion. In the same quarter of last year, the company posted $1.08 per share and $1.9 billion in sales. That EPS estimate is a nickel more than it was 60 days ago. Note that Darden's EPS have not fallen short of consensus estimates in the past six quarters.

In the second-quarter report, Darden said earnings came to $53.7 million, or $0.40 per share, which was down from the year-ago earnings but in line with expectations. Total revenue increased 6.1% from the prior-year quarter to $1.8 billion, surpassing the consensus estimate of analysts. The company said strong sales growth at the Red Lobster and LongHorn Steakhouse chains offset disappointing sales results at Olive Garden. Olive Garden has since reworked menus and increased promotions to bolster traffic.

See also: <a href="http://www.benzinga.com/news/earnings/11/12/2212751/update-darden-restaurants-reports-28-decline-in-fq2-net-income">Darden Restaurants Reports 28% in FQ2 Net Income</a>

Looking ahead to the current quarter, so far analysts expect to see similar year-over-year growth in both Darden's per-share earnings and its revenues. That EPS estimate has inched up a penny in the past 60 days.

The Company

Orlando-based Darden Restaurants operates more than 1,900 full-service restaurants in the United States and Canada under the Red Lobster, Olive Garden, LongHorn Steakhouse, Capital Grille and other banners. The company was founded in 1968 and it is now an S&amp;P 500 component with a market cap of $6.7 billion.

Competitors include Brinker International (NYSE: <a class="ticker" href="/stock/eat#NYSE">EAT</a>) and DineEquity (NYSE: <a class="ticker" href="/stock/din#NYSE">DIN</a>). Both the top and bottom lines at Brinker, operator of Chili's and Maggiano's, fell short of expectations in the most recent quarter. DineEquity, parent of the Appleby's and IHOP chains, posted a fourth-quarter profit, though its margins were squeezed by inflation and labor costs.

See also: <a href="http://www.benzinga.com/news/earnings/12/03/2388336/update-dineequity-posts-q4-profit">DineEquity Posts Q4 Profit</a>

During the three months that ended in February, Darden boosted its outlook for the third quarter, and for the second year in a row it made Fortune's list of the 100 best companies to work for. The company also unveiled a 1.1 megawatt solar panel installation at its corporate headquarters.

Performance

Darden Restaurants has a long-term earnings per share growth forecast of 12.1% and a return on equity of 25.1%. Sales increased 7.0% over the past five years. The P/E and PEG ratios are lower than the industry averages, and the operating margin is a higher than the industry average. Darden has a dividend yield of 3.3%. Analysts on average recommend buying the stock. Their mean price target on the shares is more than 5% higher than the current share price.

The stock is about 16% higher than at the beginning of the year and shares are near the 52-week high. The price has been above than 50-day and 200-day moving averages since early February. Over the past six months, though, the stock has underperformed Brinker International and DineEquity. The stock's performance has been in line with the broader markets.

See also: <a href="http://www.benzinga.com/analyst-ratings/analyst-color/12/03/2441018/bank-of-america-darden-earnings-preview">Bank of America: Darden Earnings Preview</a>

<div id="action-items">ACTION ITEMS

Bullish: Investors interested in exchange traded funds invested in Darden Restaurants might want to consider the following trades:

<ul><li>Rydex S&amp;P Equal Weight Consumer Discretionary (NYSE: <a class="ticker" href="/stock/rcd#NYSE">RCD</a>) is almost 17% higher year to date.</li>
<li>Consumer Discretionary Select Sector SPDR (NYSE: <a class="ticker" href="/stock/xly#NYSE">XLY</a>) is about 15% higher year to date.</li>
<li>iShares Russell 1000 Growth Index (NYSE: <a class="ticker" href="/stock/iwf#NYSE">IWF</a>) is more than 14% higher year to date.</li>
<li>Vanguard Mid-Cap ETF (NYSE: <a class="ticker" href="/stock/vo#NYSE">VO</a>) is more than 13% higher year to date.</li>
</ul>Bearish: Traders may prefer to consider these alternative positions in the same industry:

<ul><li>Ruth's Hospitality Group (NASDAQ: <a class="ticker" href="/stock/ruth#NASDAQ">RUTH</a>) is up more than 45% year to date.</li>
<li>Red Robin Gourmet Burgers (NASDAQ: <a class="ticker" href="/stock/rrgb#NASDAQ">RRGB</a>) is up more than 33% year to date.</li>
<li>PF Chang's China Bistro (NASDAQ: <a class="ticker" href="/stock/pfcb#NASDAQ">PFCB</a>) is up about 32% year to date.</li>
</ul>Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.</div>

PFCB

RRGB

RUTH

Darden Restaurants Earnings Preview: Double-Digit EPS Growth for Q3 Expected

VF Corp. (NYSE: <a class="ticker" href="/stock/vfc#NYSE">VFC</a>) is scheduled to report fourth-quarter 2011 results tomorrow, February 16, before the markets open. The company has reported increasing profits for three straight quarters, but analysts have been bearish lately on this apparel maker, as indicated by the decreasing EPS estimate for the most recent quarter. 

Analysts are looking for the company to report that its per-share earnings rose 22.9% from a year ago to $2.31 for the quarter, as well as that revenue totaled $2.9 billion. That would be a year-over-year revenue increase of 36.1%. But note that the EPS estimate was $2.34 some 60 days ago. However, analysts have underestimated VF Corp.'s per-share earnings in the past eight quarters -- by more than 11% in each of the past three quarters.

Looking back to the previous quarter, VF Corp. said its profit increased 24% from the year-ago period to $300.7 million, or $2.69 a share. Adjusted net income topped analyst expectations. Revenue rose 23% year over year to $2.8 billion, also beating estimates. The company attributed the strong third-quarter results to the diversity of its brand portfolio, including the recently acquired Timberland brand.

For the full year, the consensus estimate calls for $8.18 per share earnings, an increase of 21.3% from the previous year. That EPS estimate was $8.20 just 60 days ago. And full-year revenues are expected to have risen 22.4% year over year to $9.4 billion.

The Company

Greensboro, N.C.-based VF Corporation engages in the design and manufacture of apparel, footwear and accessories primarily in the U.S. and Europe. Its brands include Wrangler, Lee, Vans, The North Face and Eastpak. The company sells its products to specialty stores, department stores, national chains and mass merchants. The company was founded in 1899 and now is an S&amp;P 500 component with a market cap of $15.8 billion.

Competitors include Levi's, Nike (NYSE: <a class="ticker" href="/stock/nke#NYSE">NKE</a>), Polo Ralph Lauren (NYSE: <a class="ticker" href="/stock/rl#NYSE">RL</a>) and True Religion Apparel (NYSE: <a class="ticker" href="/stock/trlg#NYSE">TRLG</a>). Nike and Polo Ralph Lauren topped EPS and revenue estimates in their most recent quarters, but True Religion missed on both counts.

See also: <a href="http://www.benzinga.com/news/earnings/12/02/2335334/true-religion-down-25-after-company-misses-earnings-estimates">True Religion Down 25% After Company Misses Earnings Estimates</a>

During the three months that ended in December, VF Corp. was ranked as the fifth-best among Fortune 500 companies in 2011, and it boosted its quarterly dividend by 14.3%. The company also raised its full-year revenue and profit forecasts.

Performance

The company has a long-term earnings per share growth forecast of 14.0% and a return on equity of 16.3%. The operating margin is higher than the industry average, but so is the P/E ratio. VF Corp. has a dividend yield of 2.0%. Short interest is 2.4% of the float. Of 21 analysts surveyed who follow the stock, 12 rate it a Buy or Strong Buy. None recommend selling it. But their mean price target on the shares is only about 4% higher than the current share price.

After trading mostly between $130 and $140 since October, shares reached a 52-week high of $143.67 yesterday. The share price is 69.3% higher than a year ago, and up 13.1% year to date, as well as above the 50-day and 200-day moving averages. The stock has outperformed Nike, Polo Ralph Lauren and True Religion Apparel, as well as the broader markets, over the past six months.

See also: <a href="http://www.benzinga.com/trading-ideas/long-ideas/11/12/2234139/top-dividend-stocks-of-2011">Top Dividend Stocks of 2011</a>

<div id="action-items">ACTION ITEMS:

Bullish: Investors interested in exchange traded funds invested in VF Corporation might want to consider the following trades:

<ul><li>Rydex S&amp;P Equal Weight Consumer Discretionary (NYSE: <a class="ticker" href="/stock/rcd#NYSE">RCD</a>) is more than 10% higher year to date.</li>
<li>PowerShares Dynamic Consumer Discretionary (NYSE: <a class="ticker" href="/stock/pez#NYSE">PEZ</a>) is more than 9% higher year to date.</li>
<li>PowerShares Dynamic Large Cap Growth (NYSE: <a class="ticker" href="/stock/pwb#NYSE">PWB</a>) is more than 8% higher year to date.</li>
<li>SPDR S&amp;P Dividend (NYSE: <a class="ticker" href="/stock/sdy#NYSE">SDY</a>) is almost 4% higher year to date.</li>
</ul>Bearish: Traders may prefer to consider these alternative positions in the same industry:

<ul><li>Lululemon Athletica (NASDAQ: <a class="ticker" href="/stock/lulu#NASDAQ">LULU</a>) is up about 40% year to date.</li>
<li>Gildan Activewear (NYSE: <a class="ticker" href="/stock/gil#NYSE">GIL</a>) is up more than 29% year to date.</li>
<li>Hanesbrands (NYSE: <a class="ticker" href="/stock/hbi#NYSE">HBI</a>) is up more than 23% year to date.</li>
</ul>Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.</div>

LULU

PowerShares Exchange Traded Fund Trust Dynamic Large Cap Growth Portfolio

TRLG

VF Corp. Earnings Preview: Double-Digit EPS, Sales Growth Expected

Goodyear Tire &amp; Rubber (NYSE: <a class="ticker" href="/stock/gt#NYSE">GT</a>) is scheduled to report fourth-quarter 2011 results tomorrow, February 14, before the markets open. One of the most famous makers of tires for cars, trucks and aircraft, it was also one of a number of companies with operations disrupted when massive floods hit Thailand. And it has faced concerns about pension expenses, but those concerns have been factored in to 2012 earnings estimates.

Analysts are looking for the company to report that its per-share earnings more than doubled from a year ago to $0.20 for the quarter and that revenue totaled $5.9 billion. That would be a year-over-year revenue increase of 16.0%. But note that the EPS estimate has fallen from $0.31 some 60 days ago. However, Goodyear's per-share earnings have topped consensus estimates in the past ten quarters -- by more than 140% in each of the past three quarters.

Looking back to the third quarter, Goodyear said it swung from a loss in the year-ago period to a profit of $211 million, or 60 cents a share, topping analyst expectations. Revenue rose 22% year over year to $6.1 billion. The company attributed record quarterly results in part to increased per-tire revenue, a strong consumer response in Europe, and expansion of production in China and Chile.

For the full year, the consensus estimate calls for $2.07 per share earnings, an increase of 75.8% from the previous year. But that EPS estimate was $2.18 just 60 days ago. And full-year revenues are expected to have increased 22.1% year over year to $23.0 billion.

The Company

This Akron, Ohio-based company engages in the manufacture and sales of tires and related products and services to consumer and commercial customers worldwide. Its brands include Goodyear, Dunlop and Kelly. It also manufactures and markets chemicals and natural rubber products, as well as operating about 1,500 auto service center outlets. The company was founded in 1898 and now is an S&amp;P 500 component with a market cap of $3.4 billion.

Competitors include Cooper Tire &amp; Rubber (NYSE: <a class="ticker" href="/stock/ctb#NYSE">CTB</a>), Bridgestone and Michelin. Cooper reports on February 27, and analysts expected to see lower fourth-quarter and full-year earnings per share, but revenues up by double digits compared to the previous fourth quarter and full year.

See also: <a href="http://www.benzinga.com/news/11/12/2188832/cooper-tire-acquires-assets-of-serbian-plant">Cooper Tire Acquires Assets of Serbian Plant</a>

During the three months that ended in December, Goodyear said it expects to resume production at its aviation tire plant in Thailand by May. It also held a topping ceremony for its new corporate headquarters in Akron, sold a former plant in Tennessee and extended its exclusive agreement with Nascar.

Performance

Goodyear has a long-term earnings per share growth forecast of 27.3%. Its forward earnings multiple is less than the industry average P/E, but so is its operating margin. The board declared a 5.8% quarterly dividend in December. Short interest is 4.5% of the float. Of 10 analysts surveyed who follow the stock, six rate it a Buy or Strong Buy. Their mean price target on the shares is 27.7% higher than the current share price.

Shares have traded mostly between $13 and $15 since late November, with the 200-day moving average providing resistance. The share price is 2.9% lower than a year ago, and down 2.1% year to date. The 52-week range is $8.53 and $18.83. The stock has underperformed Cooper Tire and Monro Muffler Brake (NASDAQ: <a class="ticker" href="/stock/mnro#NASDAQ">MNRO</a>), as well as the broader markets, over the past six months.

See also: <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/02/2316344/will-goodyear-drive-higher">Will Goodyear Drive Higher?</a>

<div id="action-items">ACTION ITEMS:

Bullish: Investors interested in exchange traded funds invested in Goodyear might want to consider the following trades:

<ul><li>PowerShares S&amp;P 500 High Beta (NYSE: <a class="ticker" href="/stock/sphb#NYSE">SPHB</a>) is about 16% higher year to date.</li>
<li>Rydex S&amp;P 500 Pure Value (NYSE: <a class="ticker" href="/stock/rpv#NYSE">RPV</a>) is more than 12% higher year to date.</li>
<li>Rydex S&amp;P Equal Weight Consumer Discretionary (NYSE: <a class="ticker" href="/stock/rcd#NYSE">RCD</a>) is almost 10% higher year to date.</li>
<li>First Trust Value Line 100 ETF (NYSE: <a class="ticker" href="/stock/fvl#NYSE">FVL</a>) is more than 9% higher year to date.</li>
</ul>Bearish: Traders may prefer to consider these alternative positions in the rubber and plastics industry:

<ul><li>Cooper Tire &amp; Rubber (NYSE: <a class="ticker" href="/stock/ctb#NYSE">CTB</a>) is up more than 13% year to date.</li>
<li>Rogers (NYSE: <a class="ticker" href="/stock/rog#NYSE">ROG</a>) is up almost 10% year to date.</li>
<li>Carlisle Companies (NYSE: <a class="ticker" href="/stock/csl#NYSE">CSL</a>) is up more than 7% year to date.</li>
</ul>Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.</div>

MNRO

Goodyear Tire & Rubber Earnings Preview

The Dow, Nasdaq and S&amp;P 500 all closed up less than 1% yesterday, but plenty of stocks rose to 52-week highs in the trading session. Among them were Starbucks (NASDAQ: <a class="ticker" href="/stock/sbux#NASDAQ">SBUX</a>) and Yum! Brands (NYSE: <a class="ticker" href="/stock/yum#NYSE">YUM</a>), which reached multiyear highs of $47.28 and $60.45 per share, respectively.

Starbucks' new, lighter “Blonde” roasts became available in cafes and supermarkets this week. Starbucks also has been raising prices on certain offerings in markets such as the Northeast and the Sunbelt. The global coffee shop operator has more than 6,700 locations and also offers its products in supermarkets. The Seattle-based company has a market cap of $34.9 billion and it was founded in 1971.

Its P/E and PEG ratios are a bit above the industry average, but so is the operating margin. The long-term EPS growth forecast is 17.6%, the return on equity is 30.9% and the dividend yield is 1.5%. The consensus recommendation of analysts is to buy the stock. The share price is up more than 9% in the past month, as well as about 45% higher than a year ago. The stock has outperformed competitors Dunkin Brands (NASDAQ: <a class="ticker" href="/stock/dnkn#NASDAQ">DNKN</a>) and Caribou Coffee (NASDAQ: <a class="ticker" href="/stock/cbou#NASDAQ">CBOU</a>) over the past six months.

See also: <a href="http://www.benzinga.com/markets/bonds/12/01/2237163/not-the-way-to-fight-starbucks">Not the Way to Fight Starbucks</a>.

Yum! Brands just announced that it will open 100 new KFC stores in Africa in 2012 as part of its global expansion. It also sold its A&amp;W brand recently and is shopping around its Long John Silver chain. The Louisville, Ky.-based quick-service restaurant company, which also operates the Pizza Hut and Taco Bell chains, has some 37,000 restaurants in 110 countries. And it has a market cap of $27.6 billion.

Its earnings per share are anticipated to grow 12.8% over the next five years. The P/E ratio is a higher than the industry average but so is its operating margin. The return on equity is a healthy 69.7%. Short interest is less than 2% of the float. The share price is more than 18% higher than 90 days ago. But over the past six months, the stock has underperformed competitors such as Domino's Pizza (NYSE: <a class="ticker" href="/stock/dpz#NYSE">DPZ</a>) and McDonald's (NYSE: <a class="ticker" href="/stock/mcd#NYSE">MCD</a>).

<div id="action-items">ACTION ITEMS:

Bullish: Investors interested in exchange traded funds invested in Starbucks and Yum! Brands might want to consider the following trades:

<ul><li>PowerShares Dynamic Leisure &amp; Entertainment (NYSE: <a class="ticker" href="/stock/pej#NYSE">PEJ</a>) is more than 25% higher than the 52-week low.</li>
<li>Rydex S&amp;P Equal Weight Consumer Discretionary (NYSE: <a class="ticker" href="/stock/rcd#NYSE">RCD</a>) is more than 24% higher than the 52-week low.</li>
<li>Vanguard Consumer Discretionary ETF (NYSE: <a class="ticker" href="/stock/vcr#NYSE">VCR</a>) is more than 23% higher than the 52-week low.</li>
<li>Consumer Discretionary Select Sector SPDR (NYSE: <a class="ticker" href="/stock/xly#NYSE">XLY</a>) is more than 22% higher than the 52-week low.</li>
</ul>Bearish: Traders may prefer to consider these alternative positions in the same sector:

<ul><li>Chipotle Mexican Grill (NYSE: <a class="ticker" href="/stock/cmg#NYSE">CMG</a>) is up about 60% from the 52-week low.</li>
<li>Buffalo Wild Wings (NASDAQ: <a class="ticker" href="/stock/bwld#NASDAQ">BWLD</a>) is up more than 58% from the 52-week low.</li>
<li>Panera Bread (NASDAQ: <a class="ticker" href="/stock/pnra#NASDAQ">PNRA</a>) is up more than 48% from the 52-week low.</li>
<li>McDonald's (NYSE: <a class="ticker" href="/stock/mcd#NYSE">MCD</a>) is up more than 42% from the 52-week low.</li>
</ul>Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.</div>

Pre-Market Outlook

BWLD

CBOU

DNKN

PowerShares ETF Leisure & Entertainment Port

PNRA

SBUX

Starbucks and Yum! Brands to Open Near 52-Week Highs

Family Dollar (NYSE: <a class="ticker" href="/stock/fdo#NYSE">FDO</a>) is scheduled to report fiscal first-quarter 2012 results tomorrow, January 5, after the closing bell. Investors could use a little good news, considering the shares have traded mostly between $56 and $60 since the end of October and analysts seem unenthused about the stock.

The consensus forecast of analysts calls for Family Dollar to report quarterly earnings of $0.67 per share. That would up from $0.58 in the same period of last year, but is unchanged from the consensus EPS estimate 90 days ago. And so far, EPS are expected to grow sequentially and year over year in the current quarter. Note though that Family Dollar fell short of consensus EPS estimates in two of the past five quarters.

Analysts also expect the retailer to report that revenues for the quarter rose 8.4% from a year ago to $2.2 billion. Sales likewise are expected to grow sequentially and year over year in the current quarter. Revenue has risen in the past four quarters.

The Company

Family Dollar operates a chain of approximately 7,000 retail discount stores in the United States. The company offers consumable household goods, domestic products, seasonal products, apparel and giftware. It is headquartered near Charlotte, N.C., is a component of the S&amp;P 500 and was founded in 1959. Its market cap is now $6.8 billion.

During the three months that ended in November, the company expanded its reach into California with four new stores there. More recently, Family Dollar appointed a new chief merchandising officer. (See also: <a href="http://www.benzinga.com/analyst-ratings/analyst-color/11/12/2217047/citi-comments-on-family-dollar-stores">Citi Comments on Family Dollar Stores</a>.)

Performance

Per-share earnings are expected to grow about 15% over the next five years and the dividend yield is 1.2%. Family Dollar's P/E and PEG ratios are less than the industry averages, and short interest is 2.3% of the float. Its return on equity is a healthy 30.9%. But of analysts who follow the stock, 12 recommend holding it while nine rate it a Buy or Strong Buy. And their mean price target of $59.58 per share is less than 4% higher than the current share price.

The share price is almost 41% higher than the 52-week low, but only up about 5% from six months ago. And the share price recently slipped below the 50-day moving average. Over the past six months, the stock has outperformed such competitors as Dollar General (NYSE: <a class="ticker" href="/stock/dg#NYSE">DG</a>) and Target (NYSE: <a class="ticker" href="/stock/tgt#NYSE">TGT</a>), but its performance has been generally in line with the broader markets.

See also: <a href="http://www.benzinga.com/news/earnings/12/01/2234874/earnings-expectations-for-the-week-of-january-2">Earnings Expectations for the Week of January 2</a>.

<div id="action-items">ACTION ITEMS:

Bullish: Investors interested in exchange traded funds invested in Family Dollar might want to consider the following trades:

<ul><li>Rydex S&amp;P Equal Weight Consumer Discretionary (NYSE: <a class="ticker" href="/stock/rcd#NYSE">RCD</a>) is more than 21% higher than the 52-week low.</li>
<li>PowerShares S&amp;P 500 High Quality (NYSE: <a class="ticker" href="/stock/piv#NYSE">PIV</a>) is more than 18% higher than the 52-week low.</li>
<li>First Trust Consumer Discretionary AlphaDEX (NYSE: <a class="ticker" href="/stock/fxd#NYSE">FXD</a>) is more than 18% higher than the 52-week low.</li>
</ul>Bearish: Traders may prefer to consider these alternative positions in the same sector:

<ul><li>PriceSmart (NASDAQ: <a class="ticker" href="/stock/psmt#NASDAQ">PSMT</a>) is up more than 126% from the 52-week low.</li>
<li>Dollar Tree (NASDAQ: <a class="ticker" href="/stock/dltr#NASDAQ">DLTR</a>) is up about 70% from the 52-week low.</li>
<li>Big Lots (NYSE: <a class="ticker" href="/stock/big#NYSE">BIG</a>) is up more than 32% from the 52-week low.</li>
</ul>Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.</div>

DLTR

PowerShares S&P 500 High Quality Portfolio

PSMT

Family Dollar Earnings Preview: Higher EPS and Sales Expected

CarMax (NYSE: <a class="ticker" href="/stock/kmx#NYSE">KMX</a>) is scheduled to report fiscal third-quarter 2011 results tomorrow morning, December 21. Investors will be looking for the company to demonstrate that the earnings miss in the previous quarter was a fluke. Note that short interest is up from earlier this year and now is about 8.3% of the float.

The analysts' forecast calls for CarMax to report that its per-share earnings inched up a couple of pennies from the same quarter of last year to $0.38. That estimate is unchanged from 60 days ago. Looking ahead to the full-year, the forecast calls for an increase of 9.2% year over year. Note that CarMax missed EPS estimates in the previous quarter for the first time in more than eight quarters.

Analysts also expect the company to report that revenues for the quarter rose 6.4% from a year ago to $2.3 billion. Full-year revenues thus far are expected to be 10.6% higher, while for the current quarter, revenues are predicted to rise 6.0%, with EPS up 7.3% year over year. 

The Company

Richmond, Va.-based CarMax is a retailer and wholesaler of used vehicles in the United States. It also offers financing and other automotive-related products and services. The company operates more than 100 locations in 51 markets. CarMax was founded in 1993 and now is an S&amp;P 500 component with a market cap of $6.8 billion.

During the three months that ended in November, the company opened its first superstore in Massachusetts, and the CarMax Foundation celebrated making $10 million in grants. More recently, CarMax began hiring for its new location in Chattanooga, which is scheduled to open in February.

Performance

The company has a long-term earnings per share growth forecast of 13.7% and its return on equity is 17.7% The P/E and PEG ratios are greater than the industry average, but so is the operating margin. The consensus recommendation of analysts who follow the stock is to buy it, and they have a mean price target on shares that is more than 15% higher than the current share price.

The share price is up more than 32% from a 52-week low in October but still down more than 5% since the beginning of the year. It is currently above the 50-day and 200-day moving averages. Over the past three months, the stock has outperformed competitor AutoNation (NYSE: <a class="ticker" href="/stock/an#NYSE">AN</a>) and the S&amp;P 500.

Action Items:

Bullish: Investors interested in exchange traded funds with a stake in CarMax might want to consider the following trades:

<ul><li>Rydex S&amp;P Equal Weight Consumer Discretionary (NYSE: <a class="ticker" href="/stock/rcd#NYSE">RCD</a>) is about 15% higher than the 52-week low.</li>
<li>PowerShares Morningstar Stock Investor Core Portfolio (NYSE: <a class="ticker" href="/stock/pyh#NYSE">PYH</a>) is almost 15% higher than the 52-week low.</li>
<li>PowerShares Fundamental Pure Mid Growth (NYSE: PXMG) is more than 12% higher than the 52-week low.</li>
</ul>

Bearish: Traders may prefer to consider these alternative positions in the same sector:

<ul><li>Group 1 Automotive (NYSE: <a class="ticker" href="/stock/gpi#NYSE">GPI</a>) is up about 46% from the 52-week low.</li>
<li>Sonic Automotive (NYSE: <a class="ticker" href="/stock/sah#NYSE">SAH</a>) is up more than 42% from the 52-week low.</li>
<li>Copart (NASDAQ: <a class="ticker" href="/stock/cprt#NASDAQ">CPRT</a>) is more than 28% from the 52-week low.</li>
</ul>

Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.

CPRT

PowerShares Morningstar StockInvestorre Portfolio

CarMax Earnings Preview: Marginally Higher EPS Expected

Ross Stores (NYSE: <a class="ticker" href="/stock/rost#NYSE">ROST</a>) is scheduled to report fiscal third-quarter 2011 results Thursday, November 17, before the markets open. The stock was a Jim Cramer pick last week; he called the company a “great regional to national story.” Ross Stores has posted double-digit percentage earnings growth in the past three quarters.

This time, consensus forecast calls for Ross Stores to report earnings of $1.25 per share, which would be a 18.4% increase from the same quarter of last year. That EPS estimate is up from $1.07 just 60 days ago. Note that analysts' consensus estimates have been in line with actual results in the past 10 quarters.

Analysts also expect the company to report that revenues increased 8.2% from a year ago to $2.0 billion. Looking ahead to the current quarter, revenues are anticipated to be 8.4% higher year over year. And for the full year, the forecast so far calls for revenues to be up 8.4%, with per-share earnings 17.3% higher than a year ago.

The Company

Based in Pleasanton, Calif., Ross Stores operates more than 1,000 off-price retail apparel and home accessories stores primarily in the U.S. Its Ross Dress for Less brand stores sell brand and designer apparel. Its dd's DISCOUNTS brand stores sell apparel and accessories for consumers with modest budgets. This S&amp;P 500 component was founded in 1957 and now has a market cap of $10.4 billion.

During the three months that ended in October, strong sales in September prompted Ross Stores to raise its third-quarter EPS guidance. The company also saw strong same-store sales in August. And it said that its two-year $900 million stock repurchase plan was on track.

Performance

The company has a long-term earnings per share growth forecast of 11.3% and a dividend yield of 0.9%. The return on equity is 45.0%. The P/E and PEG ratios are higher than the industry average, but so is the operating margin. The company keeps more than enough cash on hand to cover its long-term debt. But 13 out of 23 analysts who follow the stock rate it a Hold; none rate it a Sell, though.

The share price reached a 52-week high of $90.69 yesterday. It has risen more than 25% in the past three months and remains well above the 50-day and 200-day moving averages. Over the past six months, the stock has outperformed competitor Stein Mart (NASDAQ: <a class="ticker" href="/stock/smrt#NASDAQ">SMRT</a>) and the broader markets, but narrowly underperformed TJX Companies (NYSE: <a class="ticker" href="/stock/tjx#NYSE">TJX</a>).

Action Items:

Bullish: Investors interested in exchange traded funds invested in Ross Stores might want to consider the following trades:

<ul><li>SPDR S&amp;P Retail (NYSE: <a class="ticker" href="/stock/xrt#NYSE">XRT</a>) is more than 20% higher than a year ago.</li>
<li>PowerShares Dynamic Retail (NYSE: <a class="ticker" href="/stock/pmr#NYSE">PMR</a>) is more than 17% higher than a year ago.</li>
<li>Rydex S&amp;P Equal Weight Consumer Discretionary (NYSE: <a class="ticker" href="/stock/rcd#NYSE">RCD</a>) is more than 11% higher than a year ago.</li>
</ul>

Bearish: Traders may want to consider these alternative positions:

<ul><li>TJX Companies (NYSE: <a class="ticker" href="/stock/tjx#NYSE">TJX</a>) is about 37% higher than a year ago.</li>
<li>Walmart (NYSE: <a class="ticker" href="/stock/wmt#NYSE">WMT</a>) is about 9% higher than a year ago.</li>
</ul>

Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.

ROST

SMRT

Ross Stores Earnings Preview: Double-Digit EPS Growth Expected

Abercrombie &amp; Fitch (NYSE: <a class="ticker" href="/stock/anf#NYSE">ANF</a>) is scheduled to report fiscal third-quarter 2011 results Wednesday, November 16, before the opening bell. Shares recently sank on news that sales were sluggish overseas. And analysts are wary, as indicated by the falling EPS estimate for the most recent period.

The consensus forecast calls for Abercrombie to report earnings of $0.71 per share, which would be a 21.1% increase from the same quarter of last year. But that EPS estimate was $0.77 just 30 days ago, and $0.82 some 90 days ago. Note though that analysts have underestimated per-share earnings results in the past five quarters -- by 14.3% in the second quarter.

Analysts also expect the company to report that revenues increased 21.0% from a year ago to $1.1 billion. Looking ahead to the current quarter, revenues are anticipated to be 19.7% higher year over year. And for the full year, the forecast so far calls for revenues to be up 21.1%, with per-share earnings 32.8% higher than a year ago.

The Company

Abercrombie &amp; Fitch is a specialty retailer of casual apparel and operates more than 1,000 stores in North America, Europe and Japan. Its brands include Abercrombie &amp; Fitch, Hollister and Gilly Hicks. This S&amp;P 500 component was founded in 1892, is headquartered in New Albany, Ohio, and currently has a market cap of $4.9 billion.

During the three months that ended in October, the company announced plans for store openings in Paris, Madrid, Dusseldorf, Brussels and Singapore. It attributed better-than-expected second-quarter results to strong same-store sales and international sales. The company also garnered attention when it asked cast members of MTV reality show The Jersey Shore to stop wearing its brands.

Performance

Per-share earnings are expected to grow more than 20% over the next five years. The forward earnings multiple is less than the industry average P/E ratio, and the 1.0 PEG ratio is in line with the industry average. Abercrombie &amp; Fitch has a dividend yield of 1.3%. The consensus recommendation of analysts is to buy the stock; only one analyst out of 35 surveyed forecasts it to underperform. Their mean price target is $76.12 per share, which is more than 24% higher than the current share price.

Due to the sell-off in early November, the share price is more than 17% lower than a month ago and well below the 200-day moving average. But shares are still trading more than 25% higher than a year ago. Also because of the recent pullback, the stock has underperformed competitors such as Aeropostale (NYSE: <a class="ticker" href="/stock/aro#NYSE">ARO</a>) and the Gap (NYSE: <a class="ticker" href="/stock/gps#NYSE">GPS</a>) over the past six months.

Action Items:

Bullish: Investors interested in exchange traded funds invested in Abercrombie &amp; Fitch might want to consider the following trades:

<ul><li>SPDR S&amp;P Retail (NYSE: <a class="ticker" href="/stock/xrt#NYSE">XRT</a>) is more than 21% higher than a year ago.</li>
<li>Rydex S&amp;P Equal Weight Consumer Discretionary (NYSE: <a class="ticker" href="/stock/rcd#NYSE">RCD</a>) is more than 12% higher than a year ago.</li>
<li>First Trust Consumer Discretionary AlphaDEX (NYSE: <a class="ticker" href="/stock/fxd#NYSE">FXD</a>) is more than 10% higher than a year ago.</li>
</ul>

Bearish: Traders may want to consider these alternative positions:

<ul><li>Buckle (NYSE: <a class="ticker" href="/stock/bke#NYSE">BKE</a>) is about 48% higher than a year ago.</li>
<li>Hot Topic (NASDAQ: <a class="ticker" href="/stock/hott#NASDAQ">HOTT</a>) is more than 29% higher than a year ago.</li>
</ul>

Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.

HOTT

Earnings Preview: A Wary Eye on Abercrombie & Fitch

Mattel (NYSE: <a class="ticker" href="/stock/mat#NYSE">MAT</a>), the company behind the Barbie, Hot Wheels, Fisher-Price and American Girl brands, is scheduled to report its third-quarter 2011 results tomorrow, October 14. The El Segundo, Calif.-based toymaker saw increased options activity this morning, and it remains under the cloud of a lost lawsuit ruling over the rights to use Bratz dolls, though the company is appealing the ruling.

Analysts on average predict that Mattel will report earnings of $0.86 per share, up from $0.77 per share in the same quarter of last year. That EPS estimate is unchanged from 60 days ago. And note that per-share earnings have not fallen short of consensus estimates in the past four quarters.

The forecast also calls for the company to post revenues of $1.9 billion, which would be a 7.6% increase from a year ago. Looking ahead to the current quarter, which will include the holiday season, analysts so far are looking for only 4.9% year-over-year growth in revenues. And the forecast for the full year so far calls for revenues up 7.9% from a year ago, with per-share earnings 13.1% higher.

The Company

Mattel designs, manufactures and markets such products as fashion dolls and accessories, toy vehicles, play sets, games and puzzles, as well as publishing activity books and magazines. The company offers its products to retailers such as toy stores and department stores, as well as to wholesalers, distributors, and via the Internet. Mattel was founded in 1945 and it now has a market cap of $9.6 billion.

During the three months that ended in September, the company appealed the Bratz ruling, as mentioned above. The company also said that popularity of Cars 2-related products drove its strong second-quarter results, and Elliot Handler, one of Mattel's cofounders and the creator of Hot Wheels, passed away at 95.

Performance

The company has a long-term earnings per share growth forecast of 12.9% and a return of equity of 28.0%. The P/E ratio is higher than the industry average, but so is the operating margin. Thirteen of 17 analysts following the stock rate it a Buy or Strong Buy, and they have a mean price target of $32.07 per share.

At $27.61, the share price is more than 13% higher than at the beginning of the year; it is up more than 6% in the past week. Shares are trading near the 52-week high and are well above the 50-day and 200-day moving averages. The stock has outperformed competitor Hasbro (NYSE: <a class="ticker" href="/stock/has#NYSE">HAS</a>) and the broader markets over the past six months.

Action Items:

Bullish: Investors interested in exchange traded funds invested in Mattel might want to consider the following trades:

<ul><li>Rydex S&amp;P Equal Weight Consumer Discretionary (NYSE: <a class="ticker" href="/stock/rcd#NYSE">RCD</a>) is more than 8% higher in the past week.</li>
<li>Consumer Discretionary Select Sector SPDR (NYSE: <a class="ticker" href="/stock/xly#NYSE">XLY</a>) is about 7% higher in the past week.</li>
<li>Guggenheim Mid-Cap Core (NYSE: <a class="ticker" href="/stock/cza#NYSE">CZA</a>) is more than 6% higher in the past week.</li>
<li>iShares Dow Jones Select Dividend Index (NYSE: <a class="ticker" href="/stock/dvy#NYSE">DVY</a>) is more than 4% higher in the past week,</li>
</ul>

Bearish: Traders may want to consider these alternative positions:

<ul><li>ProShares UltraShort Russell MidCap Value (NYSE: <a class="ticker" href="/stock/sjl#NYSE">SJL</a>) is more than 14% higher than six months ago.</li>
<li>Direxion Daily Mid Cap Bear 3X Shares (NYSE: <a class="ticker" href="/stock/mwn#NYSE">MWN</a>) is more than 9% higher than six months ago.</li>
</ul>

Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.

iShares Dow Jones Select Dividend Index Fund

ProShares UltraShort Russell MidCap Value

Mattel Earnings Preview: Solid Results Expected

Advance Auto Parts (NYSE: <a class="ticker" href="/stock/aap#NYSE">AAP</a>) is scheduled to report second-quarter 2011 results Wednesday, August 10, after the markets close. While first-quarter earnings were disappointing, the company has a high gross margin and has opened 37 new stores, which should help boost the top line.

Analysts are looking for the auto parts retailer to report earnings of $1.38 per share, which compares to $1.16 in the same period of last year. That EPS estimate has slipped a penny per share from 60 days ago. Note that before the first-quarter miss of 3 cents per share, analysts underestimated Advance Auto Parts per-share earnings in the previous four quarters.

The analysts' forecast also calls for the company to post revenues of $1.5 billion, an increase of 5.7% from a year ago. First-quarter revenue also fell short of consensus estimates, by 1.2%, but topped expectations in the previous four reporting periods.

Looking ahead to the next quarter, analysts so far are looking for year-over-year growth of both per-share earnings and revenues. And the forecast for the full year calls for EPS up 22.1% year over year and revenue up 8.9%.

The Company

Roanoke, Va.-based Advance Auto Parts is a retailer of automotive aftermarket parts, accessories and maintenance items. Its more than 3,300 stores also offer battery and wiper installation, battery charging, electrical system testing, loaner tool programs, and oil and battery recycling services. The company was founded in 1929.

During the three months that ended in June, the company refinanced a credit facility and announced a new president of its Autopart International division. It more recently launched a home-delivery service in its Ft. Myers, Florida, and its Houston markets. 

Performance

The company has a long-term earnings per share growth forecast of 11.7% and a return of equity of 34.6%. Its forward P/E ratio estimate is less than the trailing P/E ratio of 12.2, and its PEG ratio is 1.0. The dividend yield is 0.5%. But only six of 21 analysts rate the stock a Buy or Strong Buy.

The share price is nearly 6% lower than a year ago. In the past six months, the stock has outperformed competitor Pep Boys (NYSE: <a class="ticker" href="/stock/pby#NYSE">PBY</a>) but underperformed AutoZone (NYSE: <a class="ticker" href="/stock/azo#NYSE">AZO</a>) and O'Reilly Automotive (NASDAQ: <a class="ticker" href="/stock/orly#NASDAQ">ORLY</a>). The stock has also underperformed the broader markets in that time.

Action Items:

Bullish: Traders interested in an exchange traded fund that includes Advance Auto Parts as a top holding might want to consider the following trade:

<ul><li> SPDR S&amp;P Retail ETF (NYSE: <a class="ticker" href="/stock/xrt#NYSE">XRT</a>): up nearly 8% since the beginning of the year</li></ul>

Bearish: Traders who might prefer exchange traded funds that include Advance Auto Parts competitors as top holdings may want to consider these positions:

<ul><li>PowerShares DWA Technical Leaders (NYSE: <a class="ticker" href="/stock/pdp#NYSE">PDP</a>): up about 11% since the beginning of the year</li>
<li>PowerShares Buyback Achievers (NYSE: <a class="ticker" href="/stock/pkw#NYSE">PKW</a>): up about 11% since the beginning of the year</li>
<li>Rydex S&amp;P Equal Weight Consumer Discretionary Index (NYSE: <a class="ticker" href="/stock/rcd#NYSE">RCD</a>): up more than 8% since the beginning of the year</li></ul>

Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.

ORLY

PowerShares DWA Technical Leaders Portfolio

Advance Auto Parts Earnings Preview

There is something to be said for equal-weight ETFs and there is something to be said against these funds, which are part of one of the faster growing corners of the ETF universe.

In the past year, the Rydex S&amp;P 500 Equal Weight ETF (NYSE: <a class="ticker" href="/stock/rsp#NYSE">RSP</a>) has outperformed the SPDR S&amp;P 500 Trust (NYSE: <a class="ticker" href="/stock/spy#NYSE">SPY</a>) by a slim margin, but as Benzinga has noted recently, Rydex equal-weight offerings tracking the materials and technology sectors have lagged the recent performances of comparable traditional ETFs.

Still, the concept behind equal-weight equity-based ETFs is a compelling one. After all, one of the allures of ETFs is gaining exposure to multiple stocks through one fund and no one likes the nasty surprise of finding out their ETF is excessively weighted to just one or two stocks.

When the market bounces back, these five equal-weight ETFs that your broker probably forgot to tell you about could be worth taking a look at.

1) Rydex MSCI Emerging Markets Equal Weight ETF (NYSE: EWEM):
EWEM made its debut in December 2008 as the equal-weight rival to the iShares MSCI Emerging Markets Index Fund (NYSE: <a class="ticker" href="/stock/eem#NYSE">EEM</a>) and the Vanguard MSIC Emerging Markets ETF (NYSE: <a class="ticker" href="/stock/vwo#NYSE">VWO</a>). Admittedly, EWEM as lagged its more popular rivals, but EWEM offers less exposure to Brazil, something that could prove beneficial in the back half of 2011.

2) ALPS Equal Sector Weight ETF (NYSE: <a class="ticker" href="/stock/eql#NYSE">EQL</a>):
This one really flies under the radar and its broken chart indicates better value can be had by waiting to initiate new positions. That said, EQL takes a unique fund of funds type of approach by combining all nine of the large-cap SPDR ETFs into one fund. Weights range from 10.57% to 11.65%. If you want to own all the SPDRs, EQL might be the best way to do that.

3) Global X SuperDividend ETF (NYSE: <a class="ticker" href="/stock/sdiv#NYSE">SDIV</a>):
SDIV is still less than two months old, but Global X found the right combination of dividend payers and the equal-weight approach with this ETF. Home to 100 stocks, each receiving a weight of 1%, SDIV has accumulated over $30 million in assets under management and maintains decent liquidity at nearly 108,000 shares per day. The only knock here is the ETF is trading near a new low as of this writing. Still, SDIV is a sound idea in a cooperative market and may be offering some value here.

4) Rydex S&amp;P 500 Equal Weight Consumer Discretionary ETF (NYSE: <a class="ticker" href="/stock/rcd#NYSE">RCD</a>):
Yes, it is hard to advocate discretionary ETFs of any variety in this environment of high unemployment and slack economic growth, but if discretionary names get a boost, investors would do well to remember that RCD has slightly outperformed the Consumer Discretionary Select Sector SPDR (NYSE: <a class="ticker" href="/stock/xly#NYSE">XLY</a>) recently.

5) Rydex S&amp;P 500 Equal Weight Utilities ETF (NYSE: <a class="ticker" href="/stock/ryu#NYSE">RYU</a>):
There is no shame in playing some defense these days and utilities are one way to do that. The shame would be opting for the Utilities Select Sector SPDR (NYSE: <a class="ticker" href="/stock/xlu#NYSE">XLU</a>) over RYU because the latter has sharply outpaced the former over the past year.

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