NEW BULLISH Plays
The WhiteWave Foods Co. - WWAV - close: 49.74 change: +0.88
Stop Loss: 47.75
Target(s): To Be Determined
Current Gain/Loss: Unopened
Entry on June -- at $---.--
Listed on June 22, 2015
Time Frame: Exit prior to earnings in August
Average Daily Volume = 1.9 million
New Positions: Yes, see below
Consumer tastes and buying habits are changing and more people are opting for more natural and organic foods.
WWAV is in the consumer goods sector. You might not recognize the name but they are behind brands like Silk, Horizon Organic, Land-O-Lakes, International Delight, Alpro, and Earthbound Farm Organic.
WWAV considers themselves "a leading consumer packaged food and beverage company that manufactures, markets, distributes, and sells branded plant-based foods and beverages, coffee creamers and beverages, premium dairy products and organic produce throughout North America and Europe. The Company is focused on providing consumers with innovative, great-tasting food and beverage choices that meet their increasing desires for nutritious, flavorful, convenient, and responsibly-produced products. The Company's widely-recognized, leading brands distributed in North America include Silk plant-based foods and beverages, International Delight and LAND O LAKES* coffee creamers and beverages, Horizon Organic premium dairy products and Earthbound Farm' certified organic salads, fruits and vegetables. Its popular European brands of plant-based foods and beverages include Alpro and Provamel" (The Land-O-Lakes brand is licensed from the owners).
If you're looking for a company that is growing then keep an eye on WWAV. They have beaten Wall Street's estimates on both the top and bottom line relatively consistently for the last six quarters. In February they did miss the bottom line EPS number by three cents but beat the revenue estimate (with +34% growth). Then in May this year they beat on the bottom line but their revenue number was murky.
Looking at WWAV's most recent report (May 8th) the company delivered earnings of $0.24 per shares versus estimates for $0.22. Revenues were up +9.8% to $911 million. Depending who you ask this revenue number is either a small miss or it was in-line with estimates. One thing worth noting is that sales in Europe were hurt by currency headwinds.
WWAV management offered a bullish outlook on their fiscal Q2 earnings. They raised their 2015 sales estimate as well.
This month WWAV announced a big acquisition with a $550 million deal to buy plant-based nutrition maker Vega. Initially there was some concern that WWAV paid too much for Vega but the smaller company has seen its sales grow +50% in 2016. WWAV expects the Vega deal to close in the third quarter and it will add six cents per share to WWAV's 2016 earnings.
The stock has been a big winner this year. The S&P 500 is up +3.1% year to date. The NASDAQ is up +8.8%. Shares of WWAV are up +43% and show no signs of slowing down. The company has been mentioned as a potential acquisition target by multiple people this year.
Currently WWAV is hovering just below round-number resistance at $50.00. We are suggesting a trigger to launch bullish positions at $50.25.
Trigger @ $50.25
- Suggested Positions -
Buy WWAV stock @ $50.25
- (or for more adventurous traders, try this option) -
Buy the OCT $55 CALL (WWAV151016C55) current ask $1.55
option price is a current quote and not a suggested entry price.
Entry disclaimer: To avoid an unfavorable entry point, we will not launch a new play if the stock gaps open more than $1.00 past our suggested entry point.
Option Format: symbol-year-month-day-call-strike