Schaeffer's Trading Floor Blog

New Annual Lows: SUPERVALU, Groupon, and Crocs

SVU, GRPN, and CROX dip to new lows

by 7/12/2012 2:30 PM
Stocks quoted in this article:

The major market indexes have muscled their way back from this morning's steep losses, but are still sitting below breakeven. With conflicting global economic data failing to give U.S. stocks a solid direction, there is a mixed bag of equities reaching new heights versus those finding new bottoms. At last glance, the New York Stock Exchange (NYSE) has 56 securities recording new nadirs, while the Nasdaq has 61 falling to fresh bottoms. Among the stocks sinking to new lows in today's session are SUPERVALU INC. (NYSE:SVU - 2.75), Groupon Inc (NASDAQ:GRPN - 7.90), and Crocs, Inc. (NASDAQ:CROX - 14.38).

It's been an ugly day for SVU. The shares have dropped roughly 48% throughout the session, finding a new all-time bottom of $2.66 in the process. SVU has been wallowing in the red for some time, though, with the stock losing more than 67% of its value in 2012. Today's sell-off follows last night's laundry list of fundamental follies, including a suspended dividend and a deeper-than-expected 45% dip in its fiscal first-quarter profit. The brokerage bunch has left the door wide open for a round of downgrades and/or price-target cuts. Three covering analysts still maintain a "strong buy" on the stock, while the average 12-month price target of $6.75 represents a steep 145% premium to SVU's current perch.

Continuing to wallow in post-IPO misery, GRPN tagged a fresh all-time low of $7.25 right out of the gate. The stock is now trading 1% higher, but its year-to-date deficit is still marked at a miserable 62.1%. The stock's recent bout of technical troubles comes as concerns over economic stability in Europe weigh on investors' minds -- around 25% of the company's revenue comes from across the pond. Although option traders have taken a decidedly optimistic stance on the security, short sellers remain skeptical. Short interest jumped 16.6% during the past month, and now accounts for 12.1% of the stock's float.

Longbow cut its price target on CROX this morning by $4 to $22, causing the stock to backslide to a new annual low of $13.80 in early trading. However, the equity has managed to pare some of its earlier losses. CROX is now up 3.6% in the latter half of the session, cutting into its steep 44.1% year-over-year sacrifice. Option players have preferred calls on CROX in recent months, as evidenced by the stock's 50-day International Securities Exchange (ISE)/Chicago Board Options Exchange (CBOE)/NASDAQ OMX PHLX (PHLX) call/put volume ratio of 5.94. This ratio ranks in the 86th percentile of its annual range, indicating calls have been bought to open over puts at an accelerated clip. With short interest accounting for 7.4% of the security's float, this uptick in call volume may simply reflect a bit of hedging activity.

Click here to read the new high list, including Texas Industries' (NYSE:TXI) earnings-induced accomplishment.


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