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Chiquita Brands (CQB) NewsBite - CQB Is On the Move
Posted on Thursday, April 09, 2009 11:28 AM
Chiquita Brands International (CQB) appears to be on the move today and is now at $7.42, up $0.37 (5.25%) on volume of 247,929 shares traded. Over the last 52 weeks the stock has ranged from a low of $4.32 to a high of $25.77. Chiquita Brands International stock has been showing support around $6.65 and resistance in the $7.25 range. Technical indicators for the stock are neutral and S&P does not currently have a STARS rating for CQB. If you are looking for a hedged play on CQB the stock seems like it could be a candidate for a May out-of-the-money bull-put credit spread below the 5 range. [ABR-Seven Summits Strategic Investments NewsBite]
Old Orchard sees growth as Chiquita smoothies arrive in stores
Posted by Shandra Martinez | The Grand Rapids Press April 03, 2009 07:01AM
SPARTA -- You will have to look closely to find Old Orchard Brand's name on its newest product: Chiquita Frozen Fruit Smoothie concentrate.
But the Sparta-based fruit juice company is counting on a partnership with Chiquita Brands International Inc., the world's biggest seller of bananas, to ultimately grow its own brand.
"We are not only launching a new product, we are creating a new segment within the frozen category," said Kevin Miller, vice president of marketing for Old Orchard Brand.
Miller said the product already is benefiting from a Chiquita "halo effect" that has helped land it in more than 1,500 stores this week -- including local Meijer, Family Fare and D&W Fresh Market locations. Miller expects the store count to surpass 4,000 by summer, a fast start for a new product.
The frozen smoothie will be cross-promoted between the produce and freezer sections. One-quarter of the advertising budget is devoted to a social network campaign that includes samples for influential bloggers, a Facebook page, Twittering deals, a "viral" coupon and an interactive Web site.
"It's probably the most comprehensive produce launch we've had," Miller said.
All flavors carry the Chiquita label, although only two are made with banana puree supplied by the company.
Chiquita's 60-year-old brand-awareness goes beyond bananas, said Bryan Brown, Chiquita's director of corporate communications. "The Chiquita names carries a strong equity and awareness in the fresh fruit category as well."
Chiquita shipped 2.4 billion pounds of bananas and had sales of $3.6 billion in 2008. While bananas make up the bulk of Chiquita's business, the company continues to diversify its product line. It acquired salad producer Fresh Express in 2005.
Under the licensing deal, Old Orchard handles production, marketing and distribution while paying a percentage to Chiquita on sales.
SMOOTHIE FLAVORS
Newest locally produced fruit product has a tropical twist of flavors:
• Strawberry banana
• Banana colada
• Peach mango
• Mixed berry
"This unique licensing agreement with Old Orchard is very consistent with our innovation plans for value-added products," Brown said. The Cincinnati-based company's pool of licensed products has or does include ice cream, cookies and even greeting cards.
But Chiquita played a key role in the process, reviewing and approving the flavors, marketing and Old Orchard's Sparta production facility.
The 12-ounce frozen smoothie can sells for $2.69, which after adding water and ice, yields 24 ounces at a cost of about a $1 per 8-ounce serving.
(CQB) NewsBite - Buy Rating Boosts CQB
Posted on Friday, March 27, 2009 1:57 PM
Chiquita Brands International (CQB) opened at $6.95. So far today, the stock has hit a low of $6.95 and a high of $7.59. CQB is now trading at $7.23, up $0.21 (2.99%). Over the last 52 weeks the stock has ranged from a low of $4.32 to a high of $25.77. CQB stocks are rising today after an analyst at Standpoint initiated the stock at Buy with an $18 price target. Technical indicators for the stock are bearish and S&P does not currently have a STARS rating for CQB. If you are looking for a hedged play on CQB the stock seems like it could be a candidate for a May out-of-the-money bull-put credit spread below the 5 range. [ABR-Seven Summits Strategic Investments NewsBite]
Click Symbol For More News On: (CQB)
earnngs day is when this fell off the cliff, just before then might be a good time to hop off the bananna bus,
Chiquita seeks stomach share
mAR. 27 09
By James Pilcher
jpilcher@enquirer.com
Share of stomach.
It's a term normally reserved for the restaurant industry, referring to how much food from individual outlets a consumer might eat in a given week or month. It hasn't been associated much historically with Chiquita Brands International - long thought of as a purely commodity-based banana producer.
But as Chiquita's presence throughout the grocery store increases through a variety of products, including four to be launched next month, it has become a new slogan for the downtown-based produce giant, and especially for its chief marketing officer, Tanios Viviani.
"We are out to grab a bigger and bigger share and that will help us become less volatile and more predictable in terms of our results," says Viviani, who heads up the company's innovation and new product development programs. "The goal is to win the customers' hearts and minds with branded healthy fresh foods. We are going to evolve the company from a commodity company to a branded company."
In April, that "share of stomach" could grow further. Chiquita plans to roll out two new products and two enhancements to other recently launched products. The company is launching a frozen concentrate version of a fresh fruit smoothie it has sold in the past, two flavors of a prepackaged "push-up" fresh pineapple snack, a cinnamon crème dip version of its existing apple bites line, and new stackable refrigerated "multi-packs" that include apples, an apple/grape mix, and carrots.
"We want our new products to account for 5 percent of our total revenue, and we are shooting for that very soon, like three to five years," Viviani says. "We're certainly not turning our back on bananas, but we think we have a strong brand and we need to take advantage of the trend toward healthy snacking."
Whether the new launches help the financially struggling company remains to be seen. Chiquita had to take a massive write-down on its 2005 purchase of salad producer Fresh Express last year, and finished 2008 with a $323.7 million loss on total revenues of $3.6 billion. After weathering several bumpy quarters and earnings warnings last year, the company's stock fell from a 52-week high of $25.77 in early June 2008 to just over $7 this morning.
One analyst says that Chiquita already has done a good job of taking some of the volatility out of the commodity side of the business and that bananas could prove to be recession proof.
"So we don't think bananas should be a dirty word at Chiquita," says New York-based Goldman Sachs analyst Karen Eltrich. "That being said, these new products make a lot of sense and are natural extensions of the brand. It probably will take a while, but there should be some definite value added as they capitalize on these trends."
In The Freezer
One of the new products puts the company in a completely new section of the grocery store - the freezer case.
Its fresh smoothie product also marks another first for Chiquita. It's the first time that the company has entered into a cross-licensing program, as the product will be co-branded with Sparta, Mich.-based Old Orchard, the nation's No. 2 juice maker.
"It's also the first licensing deal for us, and we couldn't have picked a better partner," says Old Orchard vice president of marketing Kevin Miller. "Chiquita has an instant connotation with the consumer of being fresh and healthy, and is a fun colorful brand to put on the packaging."
Miller says the product will launch in mid-April in about 1,500 stores nationally, and will be cross-promoted between the produce and freezer sections.
"And we're confident that we could have 2,000-2,500 stores by the end of the summer," Miller says. "I see us having a $2-3 million segment just six to 12 months into the launch."
Viviani says the partnership shows how much Chiquita culture has changed.
"This partnering can be a very important part of our strategy, and get us into places that we wouldn't have been before," Viviani says. "Old Orchard, for example, has all the expertise and distribution for frozen foods, and we bring the produce expertise. The pride now comes not from just building it from within."
The concentrate will cost about $2.50 per 12-ounce can and include three 8-ounce servings. Both Viviani and Miller say the economic downturn could turn in their favor, as consumers look for ways to make products at home that they usually buy at a retail location.
The other purely new product also will hit shelves in mid-April. Chiquita's pineapple bites will come in two flavors: traditional and coconut. The product can be frozen or eaten fresh for about two weeks after being put on sale, and will operate much like a "push-up" popsicle, although the package does not include a stick. The 2.8-oz. packages will sell for about $1 each.
Viviani says the idea came from ongoing discussions with consumers, including one who asked why Chiquita couldn't make fruit portable like ice cream.
"It also hits that mindset of people on the go, but giving them a more healthy, affordable option," he says. "And in the long run, that's our way home as a company."
im starting to like green bananas, lol
this is beautiful!
Recent Trades of Chiquita Brands International Inc. by CEO:
Buy: Chairman, President & CEO Fernando Aguirre bought 63,475 shares of CQB stock on 03/12/2009 at the average price of $4.72; the price of the stock has increased by 11.86% since.
Buy: Chairman, President & CEO Fernando Aguirre bought 61,200 more shares of CQB stock on 02/26/2009 at the average price of $4.91; the price of the stock has increased by 7.54% since.
Buy: Chairman, President & CEO, Director Fernando Aguirre bought 56,300 more shares of CQB stock on 11/13/2008 at the average price of $8.81; the price of the stock has decreased by 40.07% since.
Chiquita introduces fruit products, packs
By The Packer staff
(March 9, 4:40 p.m.) Cincinnati-based Chiquita Brands International will be busy next month when it launches several new products.
Cynthia Godby, communications specialist, said the company plans to add apple bites with cinnamon creme dip to its healthy snacking product line, joining existing products apple, apple-grape, apple with caramel and carrots with ranch. The date for national launch is April 14.
Also on April 14, Chiquita will launch two flavors of pineapple bites — pineapple and pineapple with coconut. The bites will come in single-serving 2.8-ounce pineapple spears, are 100% natural, contain one complete serving of fruit, are 40 calories and have 80% of the recommended dietary allowance of vitamin C, Godby said.
Chiquita also will be transitioning its multipacks into new FridgeFit rigid packaging. The packaging is recyclable, durable and compact and allows consumers to better see product and assess freshness, Godby said.
Chiquita frozen fruit smoothie concentrates will be sold in select U.S. retail grocery beginning in April and are being produced through a brand licensing partnership with Old Orchard Brands. The smoothies are all natural, each serving contains at least a half-cup of fruit and 100% of the recommended dietary allowance of vitamin C. Flavors are strawberry banana, banana colada, peach mango and mixed berry.
Chiquita Brands International Elects Kerrii B. Anderson to Board of Directors
Former Wendy's Executive Adds Depth and Management Experience to Board
CINCINNATI, March 4 /PRNewswire-FirstCall/ -- Chiquita Brands International, Inc. (NYSE: CQB) today announced that the board of directors has elected Kerrii B. Anderson, 51, effective April 1, 2009. At that time, the size of the board will increase from eight to nine members. Anderson, who brings significant management experience in finance, accounting and executive leadership, will also serve as a member of the company's audit committee.
"We are proud to welcome Kerrii to Chiquita's board," said Fernando Aguirre, chairman and chief executive officer. "Her leadership and extensive skills in executing a strategic business transformation will enhance an already strong group of independent board members whose vision and expertise continue to advance Chiquita's sustainable growth strategy."
"Chiquita is an exciting company with two powerful, trusted brands," said Anderson. "I look forward to bringing my experience to Chiquita's board and working with the management team to build shareholder value."
Anderson most recently served as chief executive officer and president of Wendy's International, Inc., a restaurant operating and franchising company, from 2006 to September 2008, when Wendy's merged with Triarc Companies, Inc. to form Wendy's/Arby's Group Inc. From 2000 to 2006, she served as Wendy's executive vice president and chief financial officer. Previously, Anderson served as senior vice president and chief financial officer of M/I Schottenstein Homes, Inc. from 1987 to 2000.
A certified public accountant, Anderson is also a director of Laboratory Corporation of America Holdings, and is a member of the finance committee of Ohio Health and of the finance and audit committee of The Columbus Foundation. She also serves as a member of the board of trustees of Elon University.
In addition to Aguirre and Anderson, the board currently includes: Howard W. Barker Jr., former partner of KPMG LLP; William H. Camp, former executive of the Archer Daniels Midland Company; Robert W. Fisher, a private investor with more than 35 years senior management experience at various banana companies; Clare M. Hasler, executive director of the Robert Mondavi Institute for Wine and Food Science at the University of California at Davis; Durk I. Jager, former chairman, president and chief executive officer at the Procter & Gamble Co.; Jaime Serra, senior partner of Serra Associates International, a consulting firm in law and economics, and Mexico's former secretary of finance and secretary of trade and industry; and Steven P. Stanbrook, president, developing markets platform at S.C. Johnson & Son, Inc.
Chiquita Brands International, Inc. (NYSE: CQB) is a leading international marketer and distributor of high-quality fresh and value-added food products - from energy-rich bananas and other fruits to nutritious blends of convenient green salads. The company markets its healthy, fresh products under the Chiquita(R) and Fresh Express(R) premium brands and other related trademarks. With annual revenues of nearly $4 billion, Chiquita employs approximately 23,000 people and has operations in more than 90 countries worldwide. For more information, please visit our web site at www.chiquita.com.
Website: http://www.chiquita.com/
looks like the bananas are finally starting to ripen up, eom.
Holding onto my bananas for a while...
The market dragged down everything today. I'm sure we'll see a bottom confirmation for CQB soon.
Would love to grab MORE when that occurs, but kinda cash-strapped.
I might buy a couple bunches from the grocer to boost the co's revenues ;)
Not a great day today, down some 8%, but looking like it's hit a bottom resistance, so that's positive. I'm thinking mid term this is a solid company to hold IM(HOMARD)O
not liking my bananas too much yet, lol, hopefully this will turn soon.
i have to buy some more on monday, it might be the last day to get them on the cheap.
Buying more Bananas! - Chiquita Brands International Inc. (CQB) Chairman, President & CEO Fernando Aguirre Buys 61,200 Shares Feb. 27, 2009
http://www.gurufocus.com/news.php?id=50081
hairman, President & CEO of Chiquita Brands International Inc. (CQB) Fernando Aguirre buys 61,200 shares of CQB on 02/26/2009 at an average price of $4.91 a share.
Chiquita Brands International Inc. operates as a leading international marketer producer and distributor of quality fresh fruits and vegetables and processed foods sold under the `Chiquita` and other brand names. In addition in recent years the Company has expanded its processed fruit and vegetableoperations primarily through acquisitions of vegetable canning companies. Chiquita Brands International Inc. has a market cap of $604.68 million; its shares were traded at around $4.65 with a P/E ratio of 5.8 and P/S ratio of 0.13.
CQB is in the portfolios of John Keeley of Keeley Fund Management.
Recent Trades of Chiquita Brands International Inc. by CEO:
Buy: Chairman, President & CEO Fernando Aguirre bought 61,200 shares of CQB stock on 02/26/2009 at the average price of $4.91; the price of the stock has decreased by 5.3% since.
Buy: Chairman, President & CEO, Director Fernando Aguirre bought 56,300 more shares of CQB stock on 11/13/2008 at the average price of $8.81; the price of the stock has decreased by 47.22% since.
Recent Trades of Chiquita Brands International Inc. by Directors and Officers:
Buy: President,Europe & Middle East Michel Loeb bought 6,000 shares of CQB stock on 02/26/2009 at the average price of $5.12; the price of the stock has decreased by 9.18% since.
Buy: Director William H Camp bought 7,000 shares of CQB stock on 02/25/2009 at the average price of $5.49; the price of the stock has decreased by 15.3% since.
Buy: Director Howard W Jr Barker bought 10,000 shares of CQB stock on 11/21/2008 at the average price of $9.82; the price of the stock has decreased by 52.65% since.
Buy: Director Durk I Jager bought 10,000 shares of CQB stock on 11/14/2008 at the average price of $9.03; the price of the stock has decreased by 48.5% since.
Sell: Director Clare M Hasler sold 250 shares of CQB stock on 11/12/2008 at the average price of $8.88; the price of the stock has decreased by 47.64% since.
CQB upgraded by analyst Link:
http://finance.yahoo.com/q/ud?s=CQB
UPDATE 1-EU offers cuts to banana import duties - draft
Wed Feb 25, 2009 12:10pm EST
http://www.reuters.com/article/marketsNews/idAFLP76950620090225?rpc=44
Chiquita Sell-Off Is Bananas
http://seekingalpha.com/article/122281-chiquita-sell-off-is-bananas?source=reuters
Chiquita Sell-Off Is Bananas
February 24, 2009 | about stocks: CQB
Benjamin Mackovak
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Chiquita (CQB) reported Q4 2008 results last week which missed analyst expectations due primarily to lower salad sales (more on that), foreign exchange headwinds, and an $8m expense from flooding in Panama and Costa Rica. CQB also took a $375m goodwill impairment charge which made the GAAP number look much worse, however the write-off has no effect on covenant compliance or borrowing capacity.
In response to this weaker than anticipated quarter, the stock had the steepest sell-off in its history, falling -56% in the past two days! This is not a highly levered homebuilder or RV manufacturer, these guys grow bananas, leading me to believe this sell-off is way overdone. Keep in mind that CQB has a solid balance and even paid down $2.7m in debt during Q4 2008. Furthermore, they have no significant debt maturities until 2014 so there should be no concern over liquidity.
click to enlarge
What the heck happened?
Sales for bananas were strong at +9%, but the salad part of the “Salad and Healthy Snacks” segment was weak as CQB canceled certain foodservice contracts with customers that were unwilling to accept price increases. Foodservice salad volume was down -25% in the Q, according to last year’s 10-k the foodservice business makes up 30% of Salad & Healthy Snack sales. Retail value-added salads volume declined -4% in the Q. All in all, sales were roughly flat on a yr/yr basis as banana strength and growth from healthy snacks offset the weakness in salads.
Guidance was actually fairly positive in my opinion as management said they expect improved FY 2009 results vs. 2008. If CQB is able to execute I think they will be one of the few companies to show earnings growth in 2009. Given the results and guidance for FY 2009, the market’s reaction seems wildly inappropriate.
CQB is now trading at a compelling valuation relative to peer Fresh Del Monte (FDP) and is generating a FCF yield of +20%. If banana prices and volumes stay relatively constant with where they are now, I think CQB could make $1.17 (vs. $1.12 in FY 2008) in EPS in 2009. Assume a 10X P/E and CQB is an $11 stock. At $11 the stock is trading at 9.4x P/E and 6.3x EV/EBITDA. This estimate does not include any favorable impact from the removal of EU tariffs so that potentially offers even further upside, more detail below. With the stock currently trading at tangible book value (real assets, by the way, such as farms, land, etc.) the downside risk is muted.
Attractive business, significant growth potential
CQB uses their strong brand recognition to dominate the markets in which they compete with a #1 banana market share in Europe, #2 banana market share domestically, and a #1 packaged salad market share domestically. In addition, CQB is well positioned to benefit from the growth in health consciousness and the new FDA pyramid which recommends 13 daily servings of fruits and vegetables. CQB is leveraging their strong brand by introducing new products that should accelerate the company’s growth rate and achieve higher margins. CQB enjoys competitive advantages such as scale, brand recognition, and supply chain efficiencies.
Stable demand and “fruit arbitrage”
CQB sells staple products that have steady demand which is attractive during rough economic times such as these. The products are low in absolute cost so any pressure on consumer spending should not have a huge impact. CQB has recently been able to offset cost increases by meaningfully raising banana prices in the US for the first time in 15 years. In addition, CQB has shown the ability to add surcharges (related to Katrina expenses last year) when necessary without damaging demand.
Anecdotal evidence, bananas increased from $.49 per lb to $.59 per lb at my local grocery store (shout out to Harris Teeter) over the past year. This still represents a huge discount to other fruits (apples $1.89lb) and I expect that demand is relatively inelastic at these price levels due to this “fruit arbitrage”. On the call management noted that banana supply/demand remains favorable for banana prices with stable demand and tight supply.
EU tariff appears to be on the cusp of being overturned
Over the past few years CQB had been pressured by the EU tariff regime change that took effect at the beginning of 2006 which called for the removal of the existing quotas for Latin American producers while simultaneously increasing tariffs for these producers. The law was intended to provide benefits for EU interests in Africa, Caribbean, and Pacific (ACP) regions but appeared to many as a violation of free trade. The tariff per 40lb box increased 135% which effectively added $2.20 in incremental tariff cost to each box imported from Latin America. An analyst that I spoke with estimates the tariff cost CQB $1.00 EPS in 2007.
The legal landscape appears to be shifting in favor of CQB and other Latin American producers. In December 2007 the WTO ruled in favor of Ecuador that the EU was breaking international trade rules by giving preferential treatment to bananas imported from Europe’s former colonies. In May 2008 the WTO ruled in favor of the US complaint against the EU tariffs. These rulings are a big step towards reversing the tariffs. Given that a removal of the tariffs would add roughly $1.00 to EPS and my FY 2009 estimate is at $1.17, a favorable ruling should revalue CQB significantly higher. I think it is likely that the US and Ecuador prevail in overturning the tariff based on the prior WTO rulings and a pretty open/shut case.
At the current stock price of $5.60, CQB is trading at tangible book value and offers an attractive risk-reward profile. The weakness seen in Q4 was self-induced due to exiting their contracts. End demand remains stable and finding companies with earnings growth in this economy is rare.
Risks
Natural disaster disrupts operations.
EU tariffs are not overturned. At this price I don’t think there is any expectation of the removal of tariffs baked into the valuation.
Banana prices fall back to 2006 levels. This seems unlikely as the reason for depressed bananas prices in 2006 was the removal of the EU quotas which resulted in the market being flooded. Since then these unsophisticated importers have gone out of business leading to a more rational marketplace.
Disclosure: Long CQB
cqb 10k annual report is out after hours, you can find it on yahoo finance, I have to take off for a while so i cant read it right now, hopefully all the bad stuff is already out there.
if we get a green close today, monday should rock imo.
Del Monte up strongly, some funds moved over, I'm sure.
However, looks like support at this level, so, still likin them bananas
bananas are starting to look pretty good, this moves like it has a fairly small float.
BB&T Capital;
"November 18, 2008, 2:03PM EST
BB&T CAPITAL UPGRADES CHIQUITA TO BUY FROM HOLD
BB&T Capital analyst Heather Jones says since Chiquita Brands International (CQB) reported third quarter earnings on Oct. 30, CQB shares have declined 31.7%, vs. a 10.8% drop for S&P 500, despite a 7.6% increase yesterday, which was triggered by insider buying.
Jones thinks the pressure is likely attributable to fund selling, as incremental fundamental data is positive. She adds that management has done an impressive job in cleaning up the balance sheet.
She notes CQB is very comfortably positioned with regard to its debt covenants. She expects the company to continue to reduce debt, as its cash flow has been solid. She sees $1.55 2008 EPS and $1.17 2009. Jones has a $14 price target on the stock."
"February 20, 2009, 11:53AM EST
BB&T CAPITAL DOWNGRADES CHIQUITA BRANDS TO HOLD FROM BUY
BB&T Capital analyst Heather Jones says Chiquita Brands International's (CQB) $0.74 fourth quarter loss, excluding writedown on Fresh Express, was much worse than her $0.23 loss estimate.
She says the shortfall relative to her view was attributable to flood costs in Costa Rica, which were not in her model, higher-than-expected legal fees and investment spend, and bigger hit from fuel hedges.
Jones cuts $1.17 2009 EPS estimate to $0.95 largely due to the incremental interest expense. She believes the shares are now fully valued, particularly given overall multiple compression across the group."
This Heather Jones has a serious case of ineptitude LOLOL.
yeah I did yesterday and today, I hope it rebounds like it has in the past!
time to make some money off from bananas! this is way oversold and ready to bounce imo.
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