The worst shall be first. Or something like that. When Wall Street falls in love with a stock it oftentimes marks a top in the stock. Why? In short, it reflects the fact that all of the most favorable news is in the stock price. The opposite can be said for the stocks that Wall Street hates. Here all it takes is a bit of good news to turn analysts from haters to at least neutral. Dean Foods is playing out as a test case. Dean Foods was one of the worst performing stocks in the S&P 500 last year. On a fundamental front things look pretty bleak for the company. Therein lies the opportunity for investors like David Tepper who recently announced a position in the stock. As additional data points come in it will be interesting to keep an eye on Dean Foods. In today’s screencast a look at an underperformer drawing attention from a smart investor.
Items mentioned in the above screencast:
Brett Arends, “Low-rated stocks find it pretty easy to beat expectations. The favorite stocks, meanwhile, have to jump higher and higher hurdles.” (ROI)
Dean Foods was one of the worst performing stocks in 2010. (Bloomberg)
What is Dean Foods worth in a sale? (Bloomberg)
David Tepper takes a big position in Dean Foods. (market folly)
Milk prices can only remain this low for so long. (Fortune)
Is David Tepper’s bet on Dean Foods a win-win? (Money Game)