The Great Atlantic & Pacific Tea Company (GAP)

The latest runup reports say may be the result of a short squeeze on news of a merger. Who is going to buy this company, though? With over a billion in debt and not turning a profit yet, and insiders are selling... Major corporations don't need this brand name and if they did I think around 4X the book is the limit. (Not to mention that half the equity here is relying on Goodwill of $460M and total equity currently stands at $203M) There's plenty of commercial space available and in any event this one going to be hard to give away. Especially, at this price. Short this.

I have purchased GAP :-

http://finance.yahoo.com/q?s=gap&.yficrumb=%2FQnGSSWfR3m...

Industry: retail (grocery)
EPS = -3.93
EPS EST 1yr = -1.32 2yr = -2.395
PE = na Industry 14.7
PB = 3.94 Industry 1.5
PS = 0.07 Industry 0.3
P/CF = na industry 11.4
P/FCF = na Industry 13.3
Yield 0.0 Industry 0.9
Gross profit margin = 30.6 Industry 24.5
Operating margin = -0.5 Industry 1.8
Net Profit Margin = -2.9 Industry 1.0
ROA = -7.5 Industry 3.2
ROE = -95.6 Industry 10.6
Insider ownership = 42.2
Greenblatt ROC = -2.34
Greenblatt Earnings Yield = 0.00
PosFCF generic % free cash flow yield -9.11%***
Passes 13 of 17 of Mike Klein's metrics
MaxPrice = 90.80 Discount 87%**
Metrics from qtr ending 09/12/2009
Caps rank 2
http://caps.fool.com/Ticker/GAP.aspx
MC score 250

All good enough for my money. I only suggest stocks that I own !

(See posts 388/584/665/760/1051/1807/2213/3546/3755/4046/4208/4225/4345/4573/4818/5241/5242/5310/5461/5579/
5169/7651 on 'Investment Analysis Clubs / Dynamic Value Investing ' board for extra due diligence applied ). **MaxPrice is a generic version of Mike Klein's Maxprice and ROC and Earnings yields are generic versions of Greenblatt's metrics. *** PosFCF generic % free cash flow yield taken from AAII and posts 5248 and 5253

See 'Investment Analysis Clubs / Dynamic Value Investing' board and my CAPS profile for further excellent companies selling at a discount to Maxprice with excellent current metrics. CAPS only shows my selections over 100Mill (unfortunately due to restricted lower market cap applied by MF CAPS).

As stated on the 'Investment Analysis Clubs /Dynamic Value Investing' board my aim is to obtain up to 50% returns p.a. as Buffett stated he could obtain (3 times) recently. A very difficult task but you can follow along with my buys and sells on my CAPS page, where I put my money where my mouth is . If I perform well I hope you can benefit. If not , feel free to ignore my comments. CAPS allows each and everyone of us to be clinically judged on our stock picking abilities over the LONG TERM.

Please always do your own due diligence before investing.

Manucastle :o)

Do good over time.

The balance sheet requires a better job to lower the costs of sales on positive side we can see they are increase the market share. And they may perform well on future. People always like tea. Drinking tea market in US is extending

Aquisition of Pathmark will come through to be a Plus for GAP.

I think the reaction to earnings today was a bit overdone, and that makes this a prime time to take advantage of the panic and jump in. In the long-term people will get back to business as usual, when it comes to buying food at least, and GAP will still be there, ready to return to it's previous profitability.

trend PS test

on the bottom?

There are no TARP's for badly run supermarkets. GAP hasn't made a profit in years, has a ton of long term debt, and can't even shed more stores in this real estate environment. What's to like?

It has pretty much bottomed out and, if you play it right and watch it on a regular bases. It could yield me at least 15%. for the year. Where Kr yielded 45% in 2008

in recession food sells, company is well managed, undersold, undervalued and management has bought big.

The Great Atlantic & Pacific Tea Company, A&P is a large old-line retail food store. The stock with slow growth is a "classic" consumer non-durable goods company to own in a BEAR Market.

KahunaCFA does not currently own shares of A&P, the Individual Retirement Account will buy some shares this week for a long-term, stable value investment.

Kahuna, CFA

locations,locations,locations,and new fresh markets

very uneven history of profits, but heck the supermarkets will do just fine in the recession. doomsday is not near, so it's silly to see the company trading at these levels.
redemptions - institutional ownership was at 95%, now at 60something. Not the most sreaming buy out there, but still...
they are still coping with pathmark acquisition - that's a lot of leverage to digest, but even under depression of 1930s levels, this is a $11-12 stock.
$4-5 = complete capitulation.

GAP (no not the clothing retailer) meets the key screening criteria of a wide range of earnings estimates. Analysts are predicting anywhere from -0.48 to -0.19 cents a share for the third quarter. Another screening criteria, history of unpredictable earnings, is also met. For the last four quarters Green Atlantic has suprised analysts to the tune of (-56.1%), (-38.5%), (460.4%), and (74.15) one year ago. I think it safe to say analysts don’t really know what to expect from this company.

More Good News (from my perspective)

Growth for the quarter is expected at -357% , and -120% for the next quarter. Analyts have been revising their estimates downward the last 90 days. The last 52 weeks Green Atlantic has fallen significantly more than the S&P -81% vs. -42%. Not a lot of good expectations for this stock. My favorite indicator of all is the recent insider transactions. Since July of this year insiders have been buying shares like crazy, see here.

Recomendation = Buy

www.tradeonearnings.com

This has to be the bottom.

thegreatsatan

retail is dismal

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