Good Tuesday to everyone. The market is looking towards fresh gains today after an unexpected decision by Japan to
lower its central interest rate to 0.10% to 0.00%. This decision has put a bit of a hamper in my assessment of getting into Alcoa (AA) as the stock looks to be up around 12.00 this morning. Alcoa was our Play of the Week, but I thought the stock was too overvalued to play at levels above 11.80. The stock never dipped below 11.80, and we have not entered the stock. We will continue to monitor it.
In addition to the Play of the Week, yesterday, I finished the September Oxen Report Portfolio update. The Buy Report Portfolio is now up 94% for the year and jumped 20% month-over-month. The Short Sale Portfolio is now up 30% for the year. We have success rates at 75% and 83% for both portfolios, respectively. Check out the update here!
Let’s get into some new plays for this morning…
Buy Pick of the Day: Constellation Brands Inc. (STZ)
Analysis: The market is looking like its ready to make another move higher after Japan made a key interest rate decision that will move its central borrowing rate from 0.10% to 0.00%. The move is an attempt to stimulate the sluggish Japanese economy. The news sent futures up as high as 55 points on the Dow, and futures continue to move higher. One company that could benefit from a strong day in the markets as well as should get extra attention today is Constellation Brands (STZ).
The company is a wine and spirits distributor that sells brands, such as, Robert Mondavi, Corona, Svedka, Arbor Mist, and Modelo. The company operates mostly in the premium wine and beer sector with a seond large bulk business in the $5 – $20 wine area. The company is slated to report its earnings tomorrow morning, and it is looking at an average estimate of an EPS of 0.49 vs. the EPS of 0.45 one year ago.
The company has definitely been hit by the drag in consumer spending, which has meant less premium drinks being sold. However, the company’s Svedka vodka has gained lots of popularity and is expected to see growth around 10%. Additionally, the company should benefit from a retun to luxury spending that has continued to be seen growing in 2010. Those with money are starting to spend more than in 2009, and it…
