Everything is awesome...Enjoying High Liner Foods lately?
Technicals (as I see them)
The upside break of the 6 month resistence on decent volume was huge. This coincided with the jump above the 200 day moving average. A healthy sideways breather is good right now. If still above 200 MA, a golden cross of the 50 and 200 day moving average should take shape around the Q1 announcement time. If the Q1 is just ok, it should push upwards to 18.50-20.00. However if excellent then it is back to the 22.00-26.00 area.
Fundamentals (as I see them)
The CAD exchange will be a drag in the Q1 numbers (about 1.37 to USD) since HLF reports in USD. However 2nd Q. will be the reverse. However McDonald's value promo that included the fillet-o-fish should add to the volumes. Any uptick in volumes is BIG. Lent being concentrated in Q1 may skew things a bit. So no Lent effect in Q2 but off-set by stronger $CAD.
The last 3 Qs were about restructing U.S. sales execs, reducing costs, and digesting acquisitions. The added Cargill people are logistic/sale systems people and lets face it, the seafood industry is still somewhere in the 1970s. A good tick down in debt will put HLF on the M&A hunt again.
Dreams of Buyout
I am surprised a buyer has not immerged. HLF P/E is low, P/Cash flow is simply awesome, dividend is great (twice that of CLR), great revenues, and massive market footprint. Aquaculture is in "M&A vogue". Plus they got punished for their sales issues so the stock is cheap and a low $CAD means you essentially buy a $USD company at a discount. The CFO did a good job with Sobey, eventually leading to it being bought and taken private at a 58% premium. I would not be surprised if HLF is taken a simiar direction. Cargill maybe? It seems a fit with their forray into aquaculture and their approach of owning their entire process from feeding "IT" to putting "IT" on the table.
Anyway I like HLF's potential especially with the macrotrend towards seafood for the aging Baby boomers and the preference for sustainable stocks of fish. All they have to do is clean up the volume sales issue and get their margins back on track and HLF is back pushing new highs. Since this is a thinly traded stock, a good Quarter can give it a crazy swing upward. A bad Q of course will do the opposite.
Of course all this is my opionion blah blah blah.