THE HBM: SBUX, DNKN, GMCR, CBOU, RUTH, BWLD

THE HEDGEYE BREAKFAST MONITOR

 

MACRO NOTES

 

Comments from CEO Keith McCullough

 

Immediate-term TRADE overbought is as overbought does – that doesn’t change my bullish intermediate-term view on Global Equities:

 

OVERBOUGHT – from the Hang Seng (+9.1% YTD) to the DAX (+8.2% YTD) and back again to the SP500 (+4.5% YTD), this season is not even 3 weeks old and we’ve already realized what I think is an outstanding YTD return on equity given the Bernank calls risk free 0%. Immediate-term overbought lines for HK, DAX, and SPX are 20,113, 6424, and 1315, respectively.

 

DEFLATING THE INFLATION – this is Global Macro Theme #2 for us here in Q1 and it really matters – across the board we’re seeing the impact of a Strong Dollar on DEC CPI and PPI prints across the world (US CPI dropped to 3.0% DEC vs 3.4% NOV, German PPI drops this morn to 4.0% DEC vs 5.2% NOV, New Zealand CPI falls hard to 1.8% in Q4 vs 4.6% Q3)

 

TREASURIES – it took all week for the bond market to give The Fed something to think about (as Growth expectations rise, interest rates should), but this breakout above my immediate-term TRADE line of 1.95% support for 10s matters. Seeing the 10yr consistently close > 2.03% would be very bearish for the long-bond, bullish for stocks (especially Financials).

 

Get Growth and Inflation slopes right, you’ll get a lot of other things right.

 

 

SUBSECTOR PERFORMANCE

 

THE HBM: SBUX, DNKN, GMCR, CBOU, RUTH, BWLD - subsector fbr

 

 

QUICK SERVICE

 

SBUX: Starbucks and Tata Coffee likely to announce partnership this month - Economic Times - Speaking on the sidelines of an event, Tata Coffee MD Hameed Huq tells reporters that India's first Starbucks will be opened this year.

 

DNKN: Dunkin’ Donuts announces 12 new units in Omaha

 

GMCR: Green Mountain’s new Keurig brewer may use radio frequency technology in its new coffee machine to make more complicated beverages, according to documents filed with the FCC.

 

NOTABLE PERFORMANCE ON ACCELERATING VOLUME:

 

CBOU: Caribou is up +13.7% over the last week.

 

 

CASUAL DINING

 

NOTABLE PERFORMANCE ON ACCELERATING VOLUME:

 

RUTH: Now up 14% over the past week. We know the quarter was good, but that good?

 

BWLD: The worst performing casual dining name over the past week.  We had a record number of clients on our bearish BWLD call yesterday.

 

 

 

THE HBM: SBUX, DNKN, GMCR, CBOU, RUTH, BWLD - stocks

 

Howard Penney

Managing Director

 

Rory Green

Analyst

 


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