Bear Case Scenario Monster Beverage $MNST, $PEP, $KO, $DPS, $STBFY

Monster Beverage (Nasdaq:MNST) is about to release earnings. Follow this Bear Case Scenario:

Coca Cola is Monsters main distributor and a major competitor. This contradiction cannot continue forever.

Red Bull has 27% market share vs Monster with 31%. Monster still has close competition which can rumble in the market place.

Retailers are rolling out energy drinks which are much cheaper. Margins will erode and the lustre will wear off. What’s next will the major question.

George Gutowski writes from a caveat emptor perspective.

Bear Case Scenario Salesforce $CRM, $SAP, $INTU, $ADBE, $UDAY, $ORCL

Salesforce (Nasdaq:CRM) will release earnings shortly. Ponder this Bear Case Scenario:

Salesforce aggressively acquires new technology companies. If, as and when it over pays and deploys too much capital returns will suffer badly. You’re only as good as your last deal.

The core platform for Salesforce is hosted by third parties making them hostage to circumstances and events beyond their control.

Many customers refused to place all their data into the cloud. Security concerns prevail. Oracle and others offer hybrids which seem to make the medicine go down a lit bit more easily.

George Gutowski writes from a caveat emptor perspective.

Bear Case Scenario Kohl’s Corp $KSS, $M, $JCP, $COST, $XRT, $WMT, $DDS, $TGT

Kohl’s (NYSE:KSS) releases earnings soon. Ponder this Bear Case Scenario:

Discounters and mid-tier stores are investing in private labels. Kohl’s offerings of no private labels may start to look tired.

Much of Kohl’s winning formula has been copied by competitors. Kohl needs to come up with some more secret sauce.

Kohl’s has expanded at a furious pace. Some believe they are about to cannibalize sales from other stores. Same concern about e-commerce is prevalent. Will the internet enhance sales or cannibalize a Kohls customer.

George Gutowski writes from a caveat emptor perspective.

Bear Case Scenario Wendy’s $WEN, $CMPGY, $MCD, $SBUX, $YUM, $BKW

Wendy’s (Nasdaq:WEN) is about to release earnings. Ponder this Bear Case Scenario:

Competition in QSR is intensifying depressing margins and bottom lines. Only the toughest, smartest and smarmiest will survive. Fries with dat is no longer enough.

Wendy’s price points are at the high-end. Consumers are looking for value and discounts. Wendy’s disappoints a little.

Premium priced burgers are not resonating with consumers. No block busters on the menu.

George Gutowski writes from a caveat emptor perspective.

Bear Case Scenario Fortress Investment Group $FIG, $BK, $BLK, $STT, $BEN, $BX

Fortress Investment Group (NYSE:FIG) will release earnings shortly. Ponder this Bear Case Scenario.

Capital raising activities pale in comparison to competition. Will they ever raise up more capital and earn more fees.

No presence in real estate and none anticipated. Major draw back that prevents many relationships from developing more deeply.

No fund placement advisory service places FIG at a disadvantage. Not sure why management puts up with this handicap. Wonder if they have noticed.

George Gutowski writes from a caveat emptor perspective.

Bear Case Scenario Gap $GPS, $LUX, $TJX, $IDEXF, $FRCOF, $NXGPF

Gap (NYSE:GPS) will be releasing earnings shortly. Ponder this Bear Case Scenario:

Input costs are volatile and unpredictable. Add in some labour uncertainty equals margin risk. Not what you want to hear from Gap.

Strong competition from discounters is eroding previous advantages as Gap becomes a price conscious buy.

Specialty retailing is competitive and easy to enter. Pop up stores testing concept constantly arising. Gap is cool and therefore a target. It is not being overwhelmed but it does not seem to be the dominant leader that is wowing the marketplace.

George Gutowski writes from a caveat emptor perspective.

Bear Case Scenario Hilton $HLT, $MAR, $HOT, $WYN, $ACRFF

Hilton (NYSE:HLT) is about to release earnings. Ponder this Bear Case Scenario.

Hilton is highly levered. Debt means interest costs. Interest rates will rise; profits will shrink. See how this arithmetic works. Not well!

Hilton is trading at a premium to Marriott and Starwood. Consider the tear the Starwood has been on and then you need to wonder  about Hilton and why its a supposedly superior value. Not!

Lots of fixed costs make Hilton sluggish to respond to market place changes. Hotels are constantly refurbished. Hilton cannot mobilize capital fast enough to keep the game up.

George Gutowski writes from a caveat emptor perspective.