Buzz Stocks: Keurig, Best Buy, and General Motors

Today's stocks to watch in the news include GMCR, BBY, and GM

Nov 20, 2014 at 9:28 AM
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U.S. stocks are following their European counterparts into the red, as Wall Street stares at a packed economic calendar. Among the equities in focus are coffee king Keurig Green Mountain Inc (NASDAQ:GMCR), electronics retailer Best Buy Co Inc (NYSE:BBY), and beleaguered automaker General Motors Company (NYSE:GM).

  • Although GMCR topped analysts' fiscal fourth-quarter earnings and revenue estimates, and upped its quarterly dividend, the stock is pointed lower as traders pan a weaker-than-expected current-quarter outlook and news that Chief Financial Officer Frances Rathke is departing next year. Specifically, GMCR -- which settled at $153.95 on Wednesday -- is headed for a 2.4% drop out of the gate. From a longer-term perspective, the equity has more than doubled in 2014, and tagged an all-time acme of $158.87 on Tuesday. In the options pits, speculators are likely celebrating the earnings reaction, as long puts have grown increasingly popular on Keurig Green Mountain Inc in recent weeks.

  • BBY, on the other hand, is set to surge 6.9% at the open, as speculators applaud a stronger-than-anticipated third-quarter earnings report. In 2014, the shares of Best Buy Co Inc have slowly attempted to fill a major bear gap from mid-January, and today's expected jump could be what the doctor ordered, as BBY is set to explore territory north of $37 for the first time in 10 months. Meanwhile, a short-squeeze situation could add fuel to the stock's fire, as short interest represents more than a week's worth of pent-up buying demand, at BBY's average pace of trading. On Wednesday, BBY closed at $35.54.

  • GM -- which settled at $32.15 yesterday -- is bracing for a 1% dip at the open. Weighing on the shares is the latest chapter in the recall saga, with the state of Arizona suing the company for $3 billion, alleging General Motors Company endangered the public and intentionally misled consumers about faulty ignition switches that have since been linked to no fewer than 33 deaths. Technically speaking, GM has surrendered 21.3% of its value year-to-date, and has underperformed the broader S&P 500 Index (SPX) by roughly 10 percentage points during the past three months. Still, seven out of 12 analysts maintain "buy" or better opinions -- leaving the door wide open for potential downgrades to exacerbate selling pressure on the shares.
 

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