Short interest for Invesco Dorsey Wright Consumer Cyclicals Momentum ETF gives investors a sense of the degree to which investors are betting on the decline of Invesco Dorsey Wright Consumer Cyclicals Momentum ETF's stock. Short interest data is updated every two weeks.

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Back from from the brink of its coronavirus lows, Caesars Entertainment (NASDAQ: CZR) isn&#39;t just relying as its status the largest casino operator in the U.S.

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Rightfully so, Tesla Inc (NASDAQ: TSLA) is in the spotlight.

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Back from from the brink of its coronavirus lows, Caesars Entertainment (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/czr#NASDAQ">CZR</a>) isn&#39;t just relying as its status the largest casino operator in the U.S.
It&#39;s targeting iGaming and sports wagering dominance <a href="https://www.benzinga.com/m-a/20/09/17675435/caesars-entertainment-in-talks-to-buy-uks-william-hill-wsj">via a possible marriage</a> with William Hill (OTC: <a class="ticker" href="https://www.benzinga.com/stock/wimhy#OTC">WIMHY</a>). Caesars is offering $3.69 billion for its sportsbook partner and private equity firm Apollo Global Management (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/apo#NYSE">APO</a>) could also make an offer.
However, Caesars isn&#39;t in this competition to play nice or finish second place. The company is telling William Hill that if opts to team up with Apollo, its current deal where it runs Caesars&#39; domestic sportsbooks <a href="https://www.casino.org/news/caesars-has-stern-warning-for-william-hill-on-taking-apollo-offer/">will be eliminated</a>.
It remains to be seen if Apollo makes a competing bid for William Hill, but if Caesars takes the prize, the following exchange-traded funds could be worth considering for investors.
Invesco DWA Consumer Cyclicals Momentum ETF (PEZ)
Remembering that even with a more than nine-fold surge off its March lows, Caesars is still a mid-cap stock with a market capitalization of $8.68 billion, so it&#39;s not a major component in many of the 64 ETFs in which it dwells. The Invesco DWA Consumer Cyclicals Momentum ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/pez#NASDAQ">PEZ</a>) has the largest weight to the casino operator at 4.02%, making it the <a href="https://www.etfrc.com/funds/stocklocator.php">fifth-largest holding</a> in the fund.
PEZ follows the Dorsey Wright Consumer Cyclicals Technical Leaders Index, which uses relative strength as a prime determinant of securities&#39; eligibility for inclusion. In other words, it can be argued Caesars&#39; inclusion in this fund is impressive and it&#39;s one of just three casino stocks on the PEZ roster.
Roundhill Sports Betting &amp; iGaming ETF (BETZ)
Already a force among <a href="https://www.benzinga.com/trading-ideas/long-ideas/20/09/17578045/3-etfs-with-powerful-penn-national-exposure">this year&#39;s rookie ETFs</a>, the Roundhill Sports Betting &amp; iGaming ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/betz#NYSE">BETZ</a>) isn&#39;t the next largest ETF holding of Caesars equity after PEZ, though BETZ has a 2.7% weight to the stock.
What makes BETZ highly relevant in this particular conversation is that the recent run-up in William Hill vaulted that name to the top spot on the BETZ roster at <a href="https://www.roundhillinvestments.com/etf/betz/full-holdings">a weight of 9.41%</a>. That&#39;s 77 basis points above the ETF&#39;s second-largest holding, giving the lone sports betting ETF the largest William Hill weight among all ETFs.
VanEck Vectors Gaming ETF (BJK)
The VanEck Vectors Gaming ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/bjk#NASDAQ">BJK</a>) joins BETZ in the small group of ETFs featuring exposure to both Caesars and William Hill. The Caesars Palace operator accounts for 3.40% of this fund, second-highest among all ETFs. The British bookmaker commands a 1.95% slice of BJK&#39;s roster. That&#39;s enough to have the fund higher by 3.41% over the past week.

Rightfully so, Tesla Inc (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/tsla#NASDAQ">TSLA</a>) is in the spotlight. Nikola (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/nkla#NASDAQ">NKLA</a>) is trying to get there, but amid that electric vehicle battle, Workhorse Group (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/wkhs#NASDAQ">WKHS</a>) is attempting to become a story stock in its own right.
Though the maker of battery-electric vehicles and aircraft has retreated 27% from its recent high, Workhorse stock is up more than five-fold over the past month. The company recently got approval to bolster its lineup of electric vehicles and it has a stake in electric pickup maker <a href="https://www.bloomberg.com/quote/1764607D:US">Lordstown Motors Corp.</a> (LMC) some analysts <a href="https://www.benzinga.com/news/20/06/16363082/workhorse-gets-final-safety-nod-to-begin-electric-van-ramp-up">say is worth $1 billion</a>.
Bottom line: there&#39;s plenty of potential for Workhorse to add chapters to its story stock status, but while the stock was recently added to the Russell 3000 Index, it still isn&#39;t heavily represented in the world of exchange-traded funds.
However, there are few funds that could become &ldquo;Workhorse ETFs.&rdquo; Here are a few to consider.
See Also: <a href="https://www.benzinga.com/news/20/07/16494426/workhorses-cfo-on-meteoric-stock-rise-electric-delivery-vehicle-makers-capital-plans">Workhorse&#39;s CFO On Meteoric Stock Rise, Electric Delivery Vehicle Maker&#39;s Capital Plans</a>
SPDR S&amp;P Kensho Smart Mobility ETF (HAIL)
Hey, we just mentioned the SPDR S&amp;P Kensho Smart Mobility ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/hail#NYSE">HAIL</a>) as one of the leaders in the <a href="https://www.benzinga.com/trading-ideas/long-ideas/20/07/16545233/3-futuristic-transportation-etfs-hitting-new-highs">futuristic transportation ETF race</a> and one of the primary reasons the SPDR has that status is because it has one of the largest Workhorse weights among the 15 ETFs with exposure to the stock.
Workhorse accounts for 4.38% of HAIL&#39;s weight and until Wednesday it was the largest holding in the ETF prior to being surpassed by NIO (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/nio#NYSE">NIO</a>).
Invesco WilderHill Clean Energy ETF (PBW)
Now more than 15 years old, the Invesco WilderHill Clean Energy ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/pbw#NYSE">PBW</a>) is one of the oldest clean energy ETFs. Regardless of age, PBW is enjoying the fruits of another strong year for renewable energy ETFs as the Invesco fund is higher by 67% over the past 90 days.
The fund, which tracks the WilderHill Clean Energy Index, allocates 4.37% of its weight to Workhorse, making it that stock the largest holding in the ETF. Another 7.44% devoted to Nio and Tesla&nbsp;helps the cause.
Invesco DWA Consumer Cyclicals Momentum ETF (PEZ)
For those that need a little more momentum to go along with their consumer discretionary exposure, the Invesco DWA Consumer Cyclicals Momentum ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/pez#NASDAQ">PEZ</a>). In the case of this ETF, its momentum factor is rooted in relative strength with a big tilt away from large caps, which represent just a third of the PEZ roster.
Workhorse accounts for almost 3.1% of the PEZ lineup, putting the stock just outside the fund&#39;s top 10 holdings, but that&#39;s still enough to place PEZ third on the list of Workhorse ETFs in terms of percentage allocated to the stock.

A phenomenon that has caught plenty of market observers by surprise this year is the outperformance of the momentum factor <a href="http://www.benzinga.com/general/education/15/09/5832937/finding-value-in-value-etfs">over its value counterpart</a>. Momentum can take on multiple forms and it is not limited to glitzy biotechnology and Internet stocks.

	However, it is some of those glitzy Internet stocks that have driven the impressive returns accrued by the consumer discretionary group, this year&#39;s top-performing S&amp;P 500 sector.
<h3>
	Don&#39;t Be Surprised</h3>

	&quot;The strength of consumer discretionary stocks is not altogether surprising, given the strength of the labor market. Wage and salary growth is up 4.0% since last August, and consumers&rsquo; assessment of the job market is also favorable. According to The Conference Board, the spread between those stating that jobs are &quot;plentiful&quot; and those claiming that jobs are &quot;hard to get&quot; was 0.8 in September &ndash; the widest chasm in sentiment since the spring of 2008,&quot; said PowerShares, the fourth-largest U.S. ETF issuer, <a href="http://www.blog.invesco.us.com/gaining-momentum-sector-returns-and-outlook">in a recent note</a>.

	The PowerShares DWA Consumer Cyclicals Momentum Portfolio (NYSE: <a class="ticker" href="/stock/pez#NYSE">PEZ</a>) has returned 4.1 percent year-to-date. PEZ, which is home to 38 stocks and $211.4 million in assets under management, is not the traditional consumer discretionary ETF. The fund tracks a momentum-based index and, perhaps surprisingly, allocates a scant 4.5 percent of its weight to Internet stocks. Five other industry groups command larger weights in PEZ.

	Due in large part to the energy sector&#39;s significant contraction, third-quarter S&amp;P 500 earnings growth is expected to be mediocre. However, earnings growth is expected to be strong in 2016, led by the consumer discretionary and healthcare sectors.

	&quot;Looking ahead, analysts surveyed by Bloomberg as of Oct. 2, 2015 expect the strongest growth in 2016 to come from the consumer discretionary and health care sectors,&quot; notes PowerShares.
<h3>
	Newest Play</h3>

	That could prove to be good news for the PowerShares DWA Tactical Sector Rotation Portfolio (NASDAQ: DWTR), which&nbsp;<a href="http://www.benzinga.com/trading-ideas/long-ideas/15/10/5902268/the-final-four-new-etf-focuses-on-four-momentum-funds">debuted last Friday</a>. DWTR tracks the Dorsey Wright Sector 4 Index, which &quot;is designed to gain exposure to the strongest relative strength sectors in the US through the universe of nine PowerShares DWA sector Momentum ETFs,&quot;&nbsp;<a href="https://www.invesco.com/portal/site/us/financial-professional/etfs/product-detail?productId=DWTR">according to PowerShares</a>.

	The new ETF holds four other PowerShares ETFs that track Dorsey Wright momentum indexes, including PEZ and the $225.4 million PowerShares DWA Healthcare Momentum Portfolio (NYSE: <a class="ticker" href="/stock/pth#NYSE">PTH</a>). PTH is a pseudo biotech ETF as that industry accounts for almost 51.5 percent of the fund&#39;s weight.

	PEZ and PTH combine for nearly 51 percent of DWTR&#39;s weight and do not forget DWTR&#39;s largest holding, the PowerShares DWA Consumer Staples Momentum Portfolio (NYSE: <a class="ticker" href="/stock/psl#NYSE">PSL</a>). PSL is arguably the closest thing to &quot;sexy&quot; among consumer staples ETFs, but there is no arguing with its recent track record. PSL is&nbsp;<a href="http://www.benzinga.com/trading-ideas/long-ideas/15/09/5859881/bringing-some-excitement-to-consumer-staples-etfs">this year&#39;s top-performing</a> consumer staples ETF with a gain of over 10 percent.

The momentum factor has delivered surprising out-performance of its value rival this year, and there is no shortage of momentum-based exchange-traded funds investors can use to exploit that trend.
Also, there is a new kid on the block worth considering.
<h3>New ETF</h3>
	The PowerShares DWA Tactical Sector Rotation Portfolio (NASDAQ: DWTR) debuted Friday, becoming the latest in a long line of PowerShares ETFs backed by Dorsey Wright&#39;s widely followed, momentum-based methodology.
 Illinois-based PowerShares is a unit of Invesco Ltd. (NYSE: <a class="ticker" href="/stock/ivz#NYSE">IVZ</a>), and is the fourth-largest U.S. ETF issuer.
<bzrelatedlink>Related Link: <a href="http://www.benzinga.com/trading-ideas/long-ideas/15/10/5900689/long-term-investors-should-get-to-know-this-equal-weight-etf">Long-Term Investors Should Get To Know This Equal-Weight ETF</a></bzrelatedlink>

	DWTR tracks the Dorsey Wright Sector 4 Index, which &ldquo;is designed to gain exposure to the strongest relative strength sectors in the US through the universe of nine PowerShares DWA sector Momentum ETFs,&rdquo; <a href="https://www.invesco.com/portal/site/us/financial-professional/etfs/product-detail?productId=DWTR">according to PowerShares</a>.

	In plain English, that means DWTR is an ETF of ETFs, and the funds held by the new ETF are other PowerShares ETFs that follow Dorsey Wright indices.
<h3>DWTR's ETFs</h3>
 The four ETFs currently held by DWTR range in weight from 21.4 percent to almost 27.9 percent. DWTR&#39;s holdings are as follows: The PowerShares Dynamic Consumer Sta. (ETF) (NYSE: <a class="ticker" href="/stock/psl#NYSE">PSL</a>), PowerShares Dynamic Consumer Disc. (ETF) (NYSE: <a class="ticker" href="/stock/pez#NYSE">PEZ</a>), PowerShares Dynamic Healthcare Sec (ETF) (NYSE: <a class="ticker" href="/stock/pth#NYSE">PTH</a>) and the PowerShares Dynamic Tech Sec (ETF) (NYSE: <a class="ticker" href="/stock/ptf#NYSE">PTF</a>).

	Last year, PowerShares transitioned nine sector ETFs to Dorsey Wright momentum indices, including the four aforementioned ETFs that comprise the new DWTR&#39;s lineup.

	As one example, PSL, <a href="http://www.benzinga.com/trading-ideas/long-ideas/15/09/5859881/bringing-some-excitement-to-consumer-staples-etfs">2015&#39;s top-performing consumer staples ETF</a>, follows the Dorsey Wright Consumer Staples Technical Leaders Index, a benchmark that &ldquo;is designed to identify companies that are showing relative strength (momentum), and is composed of at least 30 common stocks from the NASDAQ US Benchmark Index,&rdquo; <a href="https://www.invesco.com/portal/site/us/financial-professional/etfs/product-detail?productId=PSL">according to PowerShares</a>.
<h3>PowerShares And Dorsey Wright Indices</h3>
The nine PowerShares sector ETFs that follow Dorsey Wright indices make up the universe from which DWTR&#39;s holdings can come from.
&ldquo;The Index contains a cash element to maximize the impact of the momentum factor. The Index holds only the four strongest of the nine sectors based on relative strength indicators, while the portfolios underlying the sectors implement a methodology that weights constituents based upon price momentum instead of traditional market capitalization. Momentum investing may include securities which are more volatile than the market as a whole, and can produce returns less than other investment style,&rdquo; according to PowerShares.
DWTR&#39;s index evaluates sector rankings monthly. If a sector falls out of the top four, it is sold and replaced by the highest-ranking sector not currently in the index. The new ETF came to market well-heeled with $25 million in assets. DWTR charges 0.75 percent per year, or $75 for every $10,000 invested.
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By&nbsp;<a data-ls-seen="1" href="http://www.dailygainsletter.com/author/johnwhitefoot/" rel="author" style="text-decoration: underline; font-family: Verdana, Arial, Geneva, sans-serif; font-size: 12px; line-height: 16px; background-color: rgb(255, 255, 255);" title="Posts by John Whitefoot">John Whitefoot</a>

	Bad news on Main Street is good news for Wall Street. Illogical heads prevailed on Tuesday after the U.S. government announced that the unemployment rate dipped to an ever-so-modest 7.2% in September, from 7.3% in August. The U.S. added just 148,000 new jobs in September&mdash;far short of the forecasted gain of 180,000 jobs for the month. (Source: &ldquo;The Employment Situation &ndash; September 2013,&rdquo; Bureau of Labor Statistics web site, October 22, 2013.)

	The number of long-term unemployed (those without a job for at least 27 weeks) remains stubbornly high at 4.1 million, and the underemployment rate is at an eye-watering 13.6%, up a sliver from 13.4% in August.

	Weak jobs numbers means the&nbsp;<a data-ls-seen="1" data-mce-href="http://www.dailygainsletter.com/federal-reserve/" href="http://www.dailygainsletter.com/federal-reserve/" title="Federal Reserve">Federal Reserve</a>&nbsp;will continue its $85.0-billion-per-month quantitative easing policy into 2014. Those who do not read these pages were apparently surprised last month when the Federal Reserve did what it said it was going to do&mdash;namely, keep its stimulus package intact until the economy improves to a 6.5% unemployment rate and a 2.5% inflation rate.

	It clearly hasn&rsquo;t, isn&rsquo;t, and won&rsquo;t for the foreseeable future.

	Those bad jobs numbers sent the&nbsp;S&amp;P 500&nbsp;into record intra-day territory. In the week since Congress ended the&nbsp;<a data-ls-seen="1" data-mce-href="http://www.dailygainsletter.com/us-government-shutdown/" href="http://www.dailygainsletter.com/us-government-shutdown/" title="U.S. government shutdown">U.S. government shutdown</a>, raised the debt ceiling, and reported stubbornly high unemployment, the S&amp;P 500 climbed more than three percent. Year-to-date, the S&amp;P 500 is up more than 22%.

	That increase is in sharp contrast to anything approaching reality on Wall Street. During the first quarter of 2013, 78% of S&amp;P 500 companies issued negative earnings-per-share (EPS) guidance, 81% during the second quarter, and a record 83% for the third quarter. (Source: &ldquo;Earnings Insight,&rdquo; FactSet web site, October 4, 2013.)

	Even after a record number of S&amp;P 500 companies revised their earnings lower, they&rsquo;re still having trouble meeting their depressed forecasts. Granted, while only one-fifth of the companies in the S&amp;P 500 have reported actual results, the percentage that has reported earnings above estimates is below the four-year average. At the same time, the percentage of companies that have reported revenue above estimates is also below the four-year average.

	The fourth quarter is less than a month old, but already, 18 companies in the S&amp;P 500 have issued EPS guidance for the fourth quarter. Of these, 14 have issued negative EPS guidance and four have issued positive EPS guidance&mdash;meaning that 78% have issued negative guidance, well above the five-year average of 63%. That number will continue to rise the deeper we get into the fourth quarter. (Source: &ldquo;Earnings Insight,&rdquo; FactSet web site, October 18, 2013.)

	What all of this disconnect means is that you can&rsquo;t fight quantitative easing. So long as the U.S. economy remains weak and the easy money is flowing, the S&amp;P 500,&nbsp;<a data-ls-seen="1" data-mce-href="http://www.dailygainsletter.com/dow-jones-industrial-average/" href="http://www.dailygainsletter.com/dow-jones-industrial-average/" title="Dow Jones Industrial Average">Dow Jones Industrial Average</a>, NASDAQ, and NYSE will continue to notch up gains.

	It also means that it&rsquo;s not too late for investors on the sidelines to take advantage of Wall Street&rsquo;s neurotic optimism and the Federal Reserve&rsquo;s generosity. Those bullish on the S&amp;P 500 might want to look into the SPDR S&amp;P 500 ETF Trust (NYSE: <a class="ticker" href="/stock/spy#NYSE">SPY</a>).

	Or, knowing that the consumer discretionary sector has reported the highest earnings growth for the quarter, it might not be a bad idea to look at a corresponding exchange-traded fund (ETF) like the PowerShares Dynamic Consumer Disc (NYSE: <a class="ticker" href="/stock/pez#NYSE">PEZ</a>) or First Trust Consumer Disc AlphaDEX (NYSE: <a class="ticker" href="/stock/fxd#NYSE">FXD</a>).

	Everything you learned in school about rational investors making informed decisions based on sound due diligence is an urban legend; investors follow the money. And for now, that trail leads to the Federal Reserve&rsquo;s overworked printing press.

	This article&nbsp;<a data-mce-href="http://www.dailygainsletter.com/economy/wall-street-cheers-13-6-unemployment-rate-sp-500-soars/2029/" href="http://www.dailygainsletter.com/economy/wall-street-cheers-13-6-unemployment-rate-sp-500-soars/2029/" target="_blank">Wall Street Cheers 13.6% Unemployment Rate; S&amp;P 500 Soars!</a>&nbsp;was originally published at&nbsp;<a data-mce-href="http://www.dailygainsletter.com" href="http://www.dailygainsletter.com/" target="_blank">Daily Gains Letter</a>

Economics

First Trustnsumer Discretionary AlphaDEX Fund

Wall Street Cheers 13.6% Unemployment Rate; S&P 500 Soars!

The Consumer Discretionary sector ranks seventh out of the ten sectors as detailed in my <a href="http://blog.newconstructs.com/2012/10/08/sector-rankings-for-etfs-mutual-funds/">Sector Rankings for ETFs and Mutual Funds</a>. It gets my Neutral rating, which is based on aggregation of ratings of 17 ETFs and 27 mutual funds in the Consumer Discretionary sector as of October 10, 2012. Prior reports on the best &amp; worst ETFs and mutual funds in every sector and style are <a href="http://www.newconstructs.com/nc/research/report/etf-and-fund-reports.htm">here</a>.

	Figure 1 ranks from best to worst the nine Consumer Discretionary ETFs that meet our liquidity standards and Figure 2 shows the five best and worst-rated Consumer Discretionary mutual funds. Not all Consumer Discretionary sector ETFs and mutual funds are created the same. The number of holdings varies widely (from 25 to 372), which creates drastically different investment implications and ratings. The best ETFs and mutual funds allocate more value to Attractive-or-better-rated stocks than the worst ETFs and mutual funds, which allocate too much value to Neutral-or-worse-rated stocks.

	To <a href="http://blog.newconstructs.com/2012/10/09/how-to-find-the-best-etfs-2/">identify the best</a> and <a href="http://blog.newconstructs.com/2012/04/05/how-to-avoid-the-worst-etfs/">avoid the worst</a> ETFs and mutual funds within the Consumer Discretionary sector, investors need a <a href="http://blog.newconstructs.com/2011/11/23/predictive-fund-rating-methodology/">predictive rating</a> based on (1) <a href="http://blog.newconstructs.com/2011/11/22/portfolio-management-rating-methodology/">stocks ratings</a> of the holdings and (2) the <a href="http://blog.newconstructs.com/2011/10/28/total-annual-costs-methodology/">all-in expenses</a> of each ETF and mutual fund. Investors need not rely on backward-looking ratings. My fund rating methodology is detailed <a href="http://blog.newconstructs.com/2011/11/23/predictive-fund-rating-methodology/">here</a>.

	Investors should not buy any Consumer Discretionary ETFs or mutual funds because none get an Attractive-or-better rating. If you must have exposure to this sector, you should buy a basket of Attractive-or-better rated stocks and avoid paying undeserved fund fees. Active management has a <a href="http://blog.newconstructs.com/2012/09/17/less-than-1-of-managers-deliver-alpha-here-are-details/">long history</a> of not paying off.

	Get my ratings on all ETFs and mutual funds in this sector on my free <a href="http://www.newconstructs.com/nc/fundscreener/fund-screener.htm">mutual fund and ETF screener</a>.
<div>

		Figure 1: ETFs with the Best &amp; Worst Ratings
</div>

	<a href="http://blog.newconstructs.com/wp-content/uploads/2012/10/ConsumerDiscFig11.jpg"><img alt="" class="aligncenter size-full wp-image-4723" height="212" src="http://blog.newconstructs.com/wp-content/uploads/2012/10/ConsumerDiscFig11.jpg" title="ConsumerDiscFig1" width="333" /></a>

	* Best ETFs exclude ETFs with TNA&rsquo;s less than $100 million for inadequate liquidity.
<div>

		Sources: New Constructs, LLC and company filings
</div>

	Rydex S&amp;P Equal Weight Consumer Discretionary (NYSE: <a class="ticker" href="/stock/rcd#NYSE">RCD</a>), PowerShares Dynamic Consumer Discretionary (NYSE: <a class="ticker" href="/stock/pez#NYSE">PEZ</a>), and Market Vectors Retail ETF (NYSE: <a class="ticker" href="/stock/rth#NYSE">RTH</a>) are excluded from Figure 1 because their total net assets (TNA) are below $100 million and do not meet our liquidity standards.
<div>

		Figure 2: Mutual Funds with the Best &amp; Worst Ratings &ndash; Top 5
</div>

	<a href="http://blog.newconstructs.com/wp-content/uploads/2012/10/ConsumerDiscFig21.jpg"><img alt="" class="aligncenter size-full wp-image-4722" height="207" src="http://blog.newconstructs.com/wp-content/uploads/2012/10/ConsumerDiscFig21.jpg" title="ConsumerDiscFig2" width="369" /></a>

	* Best mutual funds exclude funds with TNA&rsquo;s less than $100 million for inadequate liquidity.
<div>

		Sources: New Constructs, LLC and company filings
</div>

	ICON Funds: ICON Consumer Discretionary Fund (NYSE: ICCCX) and Fidelity Advisor Series VII: Fidelity Advisor Consumer Discretionary Fund (FCNIX) are excluded from Figure 2 because their total net assets (TNA) are below $100 million and do not meet our liquidity standards.

	Consumer Discretionary Select Sector SPDR (NYSE: <a class="ticker" href="/stock/xly#NYSE">XLY</a>) is my top-rated Consumer Discretionary ETF and Vanguard World Funds: Vanguard Consumer Discretionary Index Fund (NYSE: <a class="ticker" href="/stock/vcdax#NYSE">VCDAX</a>) is my top-rated Consumer Discretionary mutual fund. Both earn my Neutral rating.

	PowerShares Dynamic Build &amp; Construction (NYSE: <a class="ticker" href="/stock/pkb#NYSE">PKB</a>) is my worst-rated Consumer Discretionary ETF and Rydex Series Funds: Retailing Fund (RYRTX) is my worst-rated Consumer Discretionary mutual fund. Both earn my Dangerous rating.

	Figure 3 shows that 122 out of the 450 stocks (about 28% of the total net assets) held by Consumer Discretionary ETFs and mutual funds get an Attractive-or-better rating. However, not a single Consumer Discretionary ETF or mutual fund earns an Attractive-or-better rating. The reason is that the majority (about 72%) of assets held by Consumer Discretionary ETFs and mutual funds is allocated to Neutral or Dangerous-rated stocks.

	The takeaways is: mutual fund managers allocate too much capital to low-quality stocks and Consumer Discretionary ETFs hold poor quality stocks.
<div>

		Figure 3: Consumer Discretionary Sector Landscape For ETFs, Mutual Funds &amp; Stocks
</div>
<div>

		<a href="http://blog.newconstructs.com/wp-content/uploads/2012/10/ConsumerDiscFig3.jpg"><img alt="" class="aligncenter size-full wp-image-4718" height="145" src="http://blog.newconstructs.com/wp-content/uploads/2012/10/ConsumerDiscFig3.jpg" title="ConsumerDiscFig3" width="423" /></a>

		Sources: New Constructs, LLC and company filings
</div>

	As detailed in &ldquo;<a href="http://blog.newconstructs.com/2012/07/20/low-cost-funds-dupe-investors-2/">Cheap Funds Dupe Investors</a>&rdquo;, the fund industry offers many cheap funds but very few funds with high-quality stocks, or with what I call good <a href="http://blog.newconstructs.com/2011/11/22/portfolio-management-rating-methodology/">portfolio management</a>.

	Investors need to tread carefully when considering Consumer Discretionary ETFs and mutual funds, because not a single one is rated Attractive or better. As you can see in Figure 3, 98% of assets invested in Consumer Discretionary mutual funds are held in Neutral-rated funds, and only 2% are in Dangerous funds. Investors have therefore done well to avoid the worst of the Consumer Discretionary mutual funds. However, even a Neutral-rated fund exposes investors to unattractive stocks, as well as the fees charged by active management. Why pay a manager to select unattractive stocks? Investors should not buy any Consumer Discretionary ETFs or mutual funds and instead should focus on owning a basket of Attractive-or-better-rated stocks.

	Ford Motors (NYSE: <a class="ticker" href="/stock/f#NYSE">F</a>) is a great example of an Attractive-or-better-rated Consumer Discretionary stock.Iit earns my Very Attractive rating. Let&rsquo;s make no mistake about it, the American auto industry went through the ringer during the financial crisis, but Ford was better positioned than its rivals and emerged from the fracas as the clear leader of the American auto pack. Ford is ahead of it peers in increasing operational efficiency, closing outdated factories, and cutting-edge design and engineering. The result is a line of cars and trucks that is not only meeting consumer&rsquo;s demands and generating profits for the company.Ford is now more profitable than ever. During the period 2004-2009, Ford&rsquo;s average <a href="http://www.newconstructs.com/nc/help/glossary.htm#roicDef">return on invested capital</a> was a value-destroying -.85%. In 2010 Ford earned 11.6% ROIC and followed that up with 12.6% in 2011. This is a company that took advantage of a downturn to focus on capital stewardship, efficiency, and profitability. Best of all, the market has not caught on to Ford&rsquo;s new value-generating engine. The current valuation as of 10/10/12, $10.10/share, implies that Ford&rsquo;s profits will permanently decline by 59%. The mismatch between Ford&rsquo;s profitability and growing cash flows and the market&rsquo;s pessimistic valuation earn F a Very Attractive rating.

	Haverty Furniture Companies (NYSE: <a class="ticker" href="/stock/hvt#NYSE">HVT</a>) is one of my least favorite stocks held by Consumer Discretionary ETFs and mutual funds and earns my Very Dangerous rating. Haverty Furniture is not a very profitable company. Their <a href="http://www.newconstructs.com/nc/help/glossary.htm#roicDef">ROIC</a> has not exceeded their <a href="http://www.newconstructs.com/nc/help/glossary.htm#helpWacc">cost of capital</a> in a single year of my model, and has been stuck below 5% since 2005. Those low returns mean that HVT is destroying shareholder value every single year. From 2010 to 2011, HVT&rsquo;s <a href="http://www.newconstructs.com/nc/help/glossary.htm#nopat">NOPAT</a> decreased from $20.0 million to $16.6 million. Some investors may have been fooled by their accounting bottom line, however. HVT&rsquo;s Net Income increased from $8.44 million to $15.46. The reason for their accounting improvement is a non-recurring tax benefit of $14.1 million due to the reversal of the valuation allowance for their Deferred Tax Assets. Investors should not count on seeing a benefit like that again any time soon. The disconnect between HVT&rsquo;s reported Net Income and their true operating profits is one of the reasons the company gets my Very Dangerous rating.

	468 stocks of the 3000+ I cover are classified as Consumer Discretionary stocks, but Consumer Discretionary ETFs and mutual funds hold only 450 stocks.

	Figures 4 and 5 show the rating landscape of all Consumer Discretionary ETFs and mutual funds.

	Our <a href="http://blog.newconstructs.com/2012/10/08/sector-rankings-for-etfs-mutual-funds/">Sector Rankings for ETFs and Mutual Funds</a> report ranks all sectors and highlights those that offer the best investments.
<div>

		Figure 4: Separating the Best ETFs From the Worst ETFs
</div>

	<a href="http://blog.newconstructs.com/wp-content/uploads/2012/10/ConsumerDiscFig4.jpg"><img alt="" class="aligncenter size-full wp-image-4717" height="245" src="http://blog.newconstructs.com/wp-content/uploads/2012/10/ConsumerDiscFig4.jpg" title="ConsumerDiscFig4" width="409" /></a>

	Sources: New Constructs, LLC and company filings
<div>

		Figure 5: Separating the Best Mutual Funds From the Worst Mutual Funds
</div>
<div>

		<a href="http://blog.newconstructs.com/wp-content/uploads/2012/10/ConsumerDiscFig5.jpg"><img alt="" class="aligncenter size-full wp-image-4716" height="245" src="http://blog.newconstructs.com/wp-content/uploads/2012/10/ConsumerDiscFig5.jpg" title="ConsumerDiscFig5" width="409" /></a>

		Sources: New Constructs, LLC and company filings
</div>

	Review my <a href="http://www.newconstructs.com/nc/fundscreener/fund-screener.htm?task=ACTION_CATEGORY_TYPE_SEARCH&amp;selectedTypes=0,1&amp;selectedCategoryIds=5d891c2e114e11e190ae00188b533b34">full list</a> of ratings and rankings along with reports on all 17 ETFs and 27 mutual funds in the Consumer Discretionary sector.

	Disclosure: I own F. I receive no compensation to write about any specific stock, sector or&nbsp;theme.

PowerShares ETF Trust Dynamic Building &nstruction Portfolio

Rydex ETF Trust Rydex S&P Equal Weightnsumer Discretionary ETF

Merrill Lynch Retail HOLDRS Trust due 12/31/41

VCDAX

Select Sector SPDR-Consumer Discretionary

Best & Worst ETFs & Mutual Funds: Consumer Discretionary Sector

Oxford Industries (NYSE: <a class="ticker" href="/stock/oxm#NYSE">OXM</a>) is scheduled to report its fourth-quarter fiscal 2011 results tomorrow, March 27, after the markets close. 

This leading apparel designer said that holiday sales accelerated throughout Christmas, both at stores and online, and that it managed to maintain a healthy gross margin at the same time. The questions is, what does that mean for sales and profits in the fourth quarter?

Expectations

Analysts on average predict that Oxford will say that per-share earnings rose 35.2% to $0.54. That estimate has not changed in the past 60 days. But note that analysts have underestimated Oxford's EPS for more than eight quarters. Fourth-quarter revenue is forecast to have jumped 21.9% from the same period of last year to total $192.3 million.

Looking back to the third quarter, the company said its net income fell 71.4% to $1.6 million, or earnings of $0.10 per share. The year-ago quarter included profit from a division since sold. Revenues increased 22.0% year over year to $170.3 million. Both numbers exceeded analysts' expectations. The company said its Tommy Bahama and Lilly Pulitzer brands attracted shoppers despite the weak economy, and that it will accelerate Lilly Pulitzer store openings to help drive sales in the future.

For the full fiscal year, analysts expect to see earnings that are 20% higher year over year to $2.35 per share. That estimate has not changed over the past 60 days. Also, the analysts anticipate that revenue for the year will be up 24.5% to $751.6 million.

The Company

Oxford Industries is an international apparel design and marketing company with a diverse portfolio of owned and licensed brands. Its brands include Tommy Bahama, Lilly Pulitzer and Billy London. The company holds exclusive licenses to produce and sell certain product categories under the Kenneth Cole, Dockers and other labels. It also operates retail stores, restaurants and Internet websites. Oxford is headquartered in Atlanta, was founded in 1942, and now has a market cap of $798.8 million.

Competitors include Perry Ellis (NASDAQ: <a class="ticker" href="/stock/pery#NASDAQ">PERY</a>), PVH (NYSE: <a class="ticker" href="/stock/pvh#NYSE">PVH</a>) and Ralph Lauren (NYSE: <a class="ticker" href="/stock/rl#NYSE">RL</a>). Perry Ellis posted lower Q4 EPS and said it will cut jobs and some brands this year. PVH is also scheduled to report earnings Tuesday, and analysts are looking for EPS to have grown 14.7% and sales 7.0% higher year over year. Ralph Lauren posted better-than-expected EPS for the most recent quarter and raised its fiscal year sales forecast. 

See also: <a href="http://www.benzinga.com/news/earnings/12/03/2446201/pvh-earnings-preview-double-digit-eps-and-sales-growth-expected">PVH Earnings Preview</a> and <a href="http://www.benzinga.com/news/earnings/12/02/2328095/ralph-lauren-is-surging-after-q3-earnings-stock-up-10">Ralph Lauren Is Surging After Q3 Earnings</a>

During the three months that ended in January, Oxford Industries saw holiday sales accelerate through the shopping season both in its stores and online. Analyst Brean Murray Carret raised its price target on the stock, citing store expansion, inventory controls and improved margins.

See also: <a href="http://www.benzinga.com/analyst-ratings/reiteration/12/01/2262512/update-brean-murray-carret-maintains-buy-raises-pt-to-55-o">Brean Murray Maintains Buy, Raises PT to $55 on Oxford Industries</a>

Performance

Oxford Industries has a long-term earnings per share growth forecast of 15.0% and a dividend yield of 1.1%. The operating margin is higher than the industry average. Like PVH and Ralph Lauren, Oxford's P/E ratio is higher than the industry average. And short interest is 6.7% of the float. All five analysts polled who follow the stock recommend buying shares. Their mean price target on the shares is more than 9% higher than the current share price.

The share price is more than 30% higher than six months ago, despite pulling back more than 6% in the past month. It has fallen below the 200-day moving average for the first time since early December. Over the past six months, the stock has outperformed the broader markets and competitors Perry Ellis and Ralph Lauren.

See also: <a href="http://www.benzinga.com/news/earnings/12/03/2445906/earnings-expectations-for-the-week-of-march-26-bby-fdo-wag">Earnings Expectations for the Week of March 26</a>

<div id="action-items">ACTION ITEMS

Bullish: Investors interested in exchange traded funds invested in Oxford Industries might want to consider the following trades:

<ul><li>PowerShares S&amp;P SmallCap Consumer Discretionary (NASDAQ: <a class="ticker" href="/stock/pscd#NASDAQ">PSCD</a>) is almost 18% higher year to date.</li>
<li>PowerShares Dynamic Consumer Discretionary (NYSE: <a class="ticker" href="/stock/pez#NYSE">PEZ</a>) is more than 15% higher year to date.</li>
<li>iShares Russell Microcap Index (NYSE: <a class="ticker" href="/stock/wc#NYSE">WC</a>) is almost 15% higher year to date.</li>
<li>iShares Russell 2000 Growth Index (NYSE: <a class="ticker" href="/stock/iwo#NYSE">IWO</a>) is more than 13% higher year to date.</li>
</ul>Bearish: Traders may prefer to consider these alternative positions in the same industry:

<ul><li>Lululemon Athletica (NASDAQ: <a class="ticker" href="/stock/lulu#NASDAQ">LULU</a>) is up more than 62% year to date.</li>
<li>Liz Claiborne (NYSE: <a class="ticker" href="/stock/liz#NYSE">LIZ</a>) is up more than 38% year to date.</li>
<li>Under Armour (NYSE: <a class="ticker" href="/stock/ua#NYSE">UA</a>) is up more than 35% year to date.</li>
</ul>Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.</div>

Earnings

Short Ideas

Previews

LULU

PERY

PSCD

Oxford Industries Earnings Preview: Q4 EPS Expected to Be 35.2% Higher

VF Corp. (NYSE: <a class="ticker" href="/stock/vfc#NYSE">VFC</a>) is scheduled to report fourth-quarter 2011 results tomorrow, February 16, before the markets open. The company has reported increasing profits for three straight quarters, but analysts have been bearish lately on this apparel maker, as indicated by the decreasing EPS estimate for the most recent quarter. 

Analysts are looking for the company to report that its per-share earnings rose 22.9% from a year ago to $2.31 for the quarter, as well as that revenue totaled $2.9 billion. That would be a year-over-year revenue increase of 36.1%. But note that the EPS estimate was $2.34 some 60 days ago. However, analysts have underestimated VF Corp.'s per-share earnings in the past eight quarters -- by more than 11% in each of the past three quarters.

Looking back to the previous quarter, VF Corp. said its profit increased 24% from the year-ago period to $300.7 million, or $2.69 a share. Adjusted net income topped analyst expectations. Revenue rose 23% year over year to $2.8 billion, also beating estimates. The company attributed the strong third-quarter results to the diversity of its brand portfolio, including the recently acquired Timberland brand.

For the full year, the consensus estimate calls for $8.18 per share earnings, an increase of 21.3% from the previous year. That EPS estimate was $8.20 just 60 days ago. And full-year revenues are expected to have risen 22.4% year over year to $9.4 billion.

The Company

Greensboro, N.C.-based VF Corporation engages in the design and manufacture of apparel, footwear and accessories primarily in the U.S. and Europe. Its brands include Wrangler, Lee, Vans, The North Face and Eastpak. The company sells its products to specialty stores, department stores, national chains and mass merchants. The company was founded in 1899 and now is an S&amp;P 500 component with a market cap of $15.8 billion.

Competitors include Levi's, Nike (NYSE: <a class="ticker" href="/stock/nke#NYSE">NKE</a>), Polo Ralph Lauren (NYSE: <a class="ticker" href="/stock/rl#NYSE">RL</a>) and True Religion Apparel (NYSE: <a class="ticker" href="/stock/trlg#NYSE">TRLG</a>). Nike and Polo Ralph Lauren topped EPS and revenue estimates in their most recent quarters, but True Religion missed on both counts.

See also: <a href="http://www.benzinga.com/news/earnings/12/02/2335334/true-religion-down-25-after-company-misses-earnings-estimates">True Religion Down 25% After Company Misses Earnings Estimates</a>

During the three months that ended in December, VF Corp. was ranked as the fifth-best among Fortune 500 companies in 2011, and it boosted its quarterly dividend by 14.3%. The company also raised its full-year revenue and profit forecasts.

Performance

The company has a long-term earnings per share growth forecast of 14.0% and a return on equity of 16.3%. The operating margin is higher than the industry average, but so is the P/E ratio. VF Corp. has a dividend yield of 2.0%. Short interest is 2.4% of the float. Of 21 analysts surveyed who follow the stock, 12 rate it a Buy or Strong Buy. None recommend selling it. But their mean price target on the shares is only about 4% higher than the current share price.

After trading mostly between $130 and $140 since October, shares reached a 52-week high of $143.67 yesterday. The share price is 69.3% higher than a year ago, and up 13.1% year to date, as well as above the 50-day and 200-day moving averages. The stock has outperformed Nike, Polo Ralph Lauren and True Religion Apparel, as well as the broader markets, over the past six months.

See also: <a href="http://www.benzinga.com/trading-ideas/long-ideas/11/12/2234139/top-dividend-stocks-of-2011">Top Dividend Stocks of 2011</a>

<div id="action-items">ACTION ITEMS:

Bullish: Investors interested in exchange traded funds invested in VF Corporation might want to consider the following trades:

<ul><li>Rydex S&amp;P Equal Weight Consumer Discretionary (NYSE: <a class="ticker" href="/stock/rcd#NYSE">RCD</a>) is more than 10% higher year to date.</li>
<li>PowerShares Dynamic Consumer Discretionary (NYSE: <a class="ticker" href="/stock/pez#NYSE">PEZ</a>) is more than 9% higher year to date.</li>
<li>PowerShares Dynamic Large Cap Growth (NYSE: <a class="ticker" href="/stock/pwb#NYSE">PWB</a>) is more than 8% higher year to date.</li>
<li>SPDR S&amp;P Dividend (NYSE: <a class="ticker" href="/stock/sdy#NYSE">SDY</a>) is almost 4% higher year to date.</li>
</ul>Bearish: Traders may prefer to consider these alternative positions in the same industry:

<ul><li>Lululemon Athletica (NASDAQ: <a class="ticker" href="/stock/lulu#NASDAQ">LULU</a>) is up about 40% year to date.</li>
<li>Gildan Activewear (NYSE: <a class="ticker" href="/stock/gil#NYSE">GIL</a>) is up more than 29% year to date.</li>
<li>Hanesbrands (NYSE: <a class="ticker" href="/stock/hbi#NYSE">HBI</a>) is up more than 23% year to date.</li>
</ul>Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.</div>

PowerShares Exchange Traded Fund Trust Dynamic Large Cap Growth Portfolio

TRLG

VF Corp. Earnings Preview: Double-Digit EPS, Sales Growth Expected

The Nasdaq closed up more than 1%, the Dow and S&amp;P 500 less than 1%, yesterday. Plenty of stocks rose to new 52-week highs during the trading session. Among them were Coach (NYSE: <a class="ticker" href="/stock/coh#NYSE">COH</a>) and Nike (NYSE: <a class="ticker" href="/stock/nke#NYSE">NKE</a>), which reached multiyear highs of $69.47 and $103.29 per share, respectively.

Coach this week posted better-than-expected quarterly results due to healthy sales in North America and China. The luxury goods purveyor opened new stores in both locations during the quarter. This New York-based retailer primarily offers handbags, and also operates stores in Japan, Hong Kong and Macau. It is an S&amp;P 500 component, was founded in 1941, and now has a market cap of $20.5 billion.

Earnings per share are anticipated to grow 16.1% over the next five years. The dividend yield is 1.3%. Though the P/E and PEG ratios are higher than the industry average, so is the operating margin. Analysts on average recommend buying the stock. The share price is about 16% higher than a month ago, as well as more than 32% higher than a year ago. But the stock's performance has been largely in line with the broader markets over the past six months.

See also: <a href="http://www.benzinga.com/news/earnings/12/01/2285383/is-coach-still-americas-premier-luxury-brand">Is Coach Still America's Premier Luxury Brand?</a>

Nike invests heavily in social networking in order to promote its brand image and products on the internet. It also has been exploiting growth potential in China, where it has enhanced its distribution network. This footwear, apparel and accessory designer and purveyor is based in Beaverton, Ore. Nike is an S&amp;P 500 component with a market cap is $47.4 billion, and it was founded in 1964.

Nike has a dividend yield of 2.7%, its return on equity is 22.5% and the long-term EPS growth forecast is 12.0%. The P/E and PEG ratios are higher than the industry average, but so is the operating margin. Twelve of 20 analysts following the stock recommend buying it. The share price increased almost 9% in the past month and is more than 50% higher than the 52-week low last March. The stock has outperformed competitors such as Steve Madden (NASDAQ: <a class="ticker" href="/stock/shoo#NASDAQ">SHOO</a>) and Wolverine World Wide (NYSE: <a class="ticker" href="/stock/www#NYSE">WWW</a>) over the past six months.

See also: <a href="http://www.benzinga.com/trading-ideas/dividends/12/01/2266498/top-4-stocks-in-the-textile-apparel-footwear-accessories-indus">Top 4 Stocks in the Textile-Apparel Footwear and Accessories Industry with the Highest Dividend Yield</a>.

<div id="action-items">ACTION ITEMS:

Bullish: Investors interested in exchange traded funds invested in Coach or Nike might want to consider the following trades:

<ul><li>ProShares Ultra Russell MidCap Growth (NYSE: <a class="ticker" href="/stock/ukw#NYSE">UKW</a>) is about 57% higher than the 52-week low.</li>
<li>iShares Russell Midcap Growth Index (NYSE: <a class="ticker" href="/stock/iwp#NYSE">IWP</a>) is more than 28% higher than the 52-week low.</li>
<li>PowerShares Dynamic Consumer Discretionary (NYSE: <a class="ticker" href="/stock/pez#NYSE">PEZ</a>) is more than 28% higher than the 52-week low.</li>
<li>PowerShares Dynamic Large Cap Growth (NYSE: <a class="ticker" href="/stock/pwb#NYSE">PWB</a>) is more than 23% higher than the 52-week low.</li>
</ul>Bearish: Traders may prefer to consider these alternative positions in the same sector:

<ul><li>Steve Madden (NASDAQ: <a class="ticker" href="/stock/shoo#NASDAQ">SHOO</a>) is up about 63% from the 52-week low.</li>
<li>Wolverine World Wide (NYSE: <a class="ticker" href="/stock/www#NYSE">WWW</a>) is up almost 28% from the 52-week low.</li>
<li>RG Barry (NASDAQ: <a class="ticker" href="/stock/dfz#NASDAQ">DFZ</a>) is up about 56% from the 52-week low.</li>
</ul>Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.</div>

Pre-Market Outlook

iShares Trust Russell Midcap Growth Index Fund

SHOO

Coach and Nike to Open Near 52-Week Highs

Bed Bath &amp; Beyond (NASDAQ: <a class="ticker" href="/stock/bbby#NASDAQ">BBBY</a>) is scheduled to report fiscal third-quarter 2011 results Wednesday, December 21, after the markets close. Though the stock is trading near a multiyear high, analysts' sentiment has been waning over the past three months. Investors will be looking for another in the company's series of earnings beats.

The analysts' forecast calls for per-share earnings that increased 15.9% from the same quarter of last year to $0.88. That estimate is unchanged from 60 days ago. So far, the consensus full-year EPS estimate is for a 19.6% increase from last year. Note that analysts have underestimated the company's earnings results in the past ten quarters.

Analysts also expect the company to report that revenues for the quarter rose 7.2% from a year ago to $2.4 billion. Revenue has risen in the past four quarters. Full-year revenues are expected to be 7.8% higher year over year. 

The Company

Bed Bath &amp; Beyond operates more than 1,100 stores in North America that offer domestic merchandise and home furnishings. Its banners include Bed Bath &amp; Beyond, Christmas Tree Shops, Harmon and Harmon Face Values, and buybuy BABY. The New Jersey-based company was founded in 1971 and now is an S&amp;P 500 component with a market cap of $14.9 billion.

During the three months that ended in November, the company increased its full-year profit guidance along with posting better-than-expected second-quarter results, which prompted two analysts to raise their EPS estimates.

Performance

The company has a long-term earnings per share growth forecast of 15.3% and a return on equity of 22.9%. The forward earnings multiple is less than the industry average P/E ratio, and the PEG ratio is less than the industry average as well. The operating margin is better than the industry average. The consensus recommendation of analysts who follow the stock is to buy it, and they have a mean price target on shares that is about 9% higher than the current share price.

The share price has dropped about 5% from a recent 52-week high and is more than 26% higher than a year ago. It is still above the 50-day and 200-day moving averages. Over the past six months, the stock has outperformed competitors such as Williams-Sonoma (NYSE: <a class="ticker" href="/stock/wsm#NYSE">WSM</a>) and Target (NYSE: <a class="ticker" href="/stock/tgt#NYSE">TGT</a>), as well as the S&amp;P 500.

Action Items:

Bullish: Investors interested in exchange traded funds with a stake in Bed Bath &amp; Beyond might want to consider the following trades:

<ul><li>SPDR S&amp;P Homebuilders (NYSE: <a class="ticker" href="/stock/xhb#NYSE">XHB</a>) is about 31% higher than the 52-week low.</li>
<li>PowerShares Dynamic Retail (NYSE: <a class="ticker" href="/stock/pmr#NYSE">PMR</a>) is more than 20% higher than the 52-week low.</li>
<li>PowerShares Dynamic Consumer Discretionary (NYSE: <a class="ticker" href="/stock/pez#NYSE">PEZ</a>) is almost 17% higher than the 52-week low.</li>
</ul>

Bearish: Traders may prefer to consider these alternative positions in the same sector:

<ul><li>Kirkland's (NASDAQ: <a class="ticker" href="/stock/kirk#NASDAQ">KIRK</a>) is up about 61% from the 52-week low.</li>
<li>Pier 1 Imports (NYSE: <a class="ticker" href="/stock/pir#NYSE">PIR</a>) is up more than 54% from the 52-week low.</li>
</ul>

Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.

BBBY

KIRK

PowerShares ETF Trust Dynamic Retail Portfolio

Bed Bath & Beyond Earnings Preview

Dollar Tree (NASDAQ: <a class="ticker" href="/stock/dltr#NASDAQ">DLTR</a>) is scheduled to report fiscal third-quarter 2011 results Thursday, November 17, before the opening bell. The company has seen double-digit year-over-year percentage revenue growth for the past four quarters, as well as its net income rise in three consecutive quarters. There is little reason for investors to doubt that cost-conscious consumers are continuing to seek out bargains.

The consensus forecast calls for Dollar Tree to report earnings of $0.83 per share, which would be a dime more than in the same quarter of last year. And that EPS estimate is up a penny from where it was 60 days ago. Note though that analysts have underestimated its quarterly per-share earnings results since 2007.

Analysts also expect the company to report that revenues increased 10.4% from a year ago to $1.6 billion. Looking ahead to the current quarter, revenues are anticipated to be 11.0% higher year over year. And for the full year, the forecast so far calls for revenues to be up 11.8%, with per-share earnings 17.9% higher than a year ago.

The Company

Dollar Tree operates more than 4,000 discount variety stores under several banners in the United States and Canada. Its stores offer consumable merchandise, variety merchandise and seasonal items, typically at a cost of $1.00. The company was founded in 1986, is headquartered in Chesapeake, Va., and currently has a market cap of $9.6 billion.

During the three months that ended in October, the company announced a $1.5 billion common stock repurchasing plan. And Dollar Tree credited its higher-than-expected second-quarter profit to cost reductions that boosted margins, and the retailer raised its earnings outlook for the year.

Performance

Per-share earnings are expected to grow more than 17% over the next five years. The P/E ratio is higher than the industry average, but so is the operating margin, and the return on equity is a healthy 30.4%. The PEG ratio is 1.0. The consensus recommendation of analysts is to buy the stock; none of the analysts surveyed rate the stock at Sell. Their mean price target is $81.27 per share. But that is only a little more than 3% higher than the current share price.

The share price has pulled back about 5% from a recent 52-week high. It remains above the 50-day and 200-day moving averages. And shares are still trading almost 47% higher than a year ago. Over the past six months, the stock has underperformed competitors such as Family Dollar (NYSE: <a class="ticker" href="/stock/fdo#NYSE">FDO</a>) and the 99 Cents Only Stores (NYSE: <a class="ticker" href="/stock/ndn#NYSE">NDN</a>), as well as the broader markets.

Action Items:

Bullish: Investors interested in exchange traded funds invested in Dollar Tree might want to consider the following trades:

<ul><li>PowerShares Dynamic Retail (NYSE: <a class="ticker" href="/stock/pmr#NYSE">PMR</a>) is more than 17% higher than a year ago.</li>
<li>SPDR S&amp;P 400 Mid Cap Growth ETF (NYSE: MDYG) is more than 8% higher than a year ago.</li>
<li>PowerShares Dynamic Consumer Discretionary (NYSE: <a class="ticker" href="/stock/pez#NYSE">PEZ</a>) is more than 5% higher than a year ago.</li>
</ul>

Bearish: Traders may want to consider these alternative positions:

<ul><li>Dollar General (NYSE: <a class="ticker" href="/stock/dg#NYSE">DG</a>) is more than 37% higher than a year ago.</li>
<li>Family Dollar (NYSE: <a class="ticker" href="/stock/fdo#NYSE">FDO</a>) is more than 22% higher than a year ago.</li>
<li>Walmart (NYSE: <a class="ticker" href="/stock/wmt#NYSE">WMT</a>) is about 12% higher than a year ago.</li>
</ul>

Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.

DLTR

Dollar Tree Earnings Preview: Higher EPS and Sales Expected

Yum! Brands (NYSE: <a class="ticker" href="/stock/yum#NYSE">YUM</a>) will be reporting its second-quarter 2011 results Wednesday, July 13, after the markets close. Investors will be watching to see if analysts are correct that growth in China and emerging markets will offset recent struggles at the company's Taco Bell unit.

Analysts are looking for the company to report per-share earnings of $0.61, which is up from $0.58 per share in the same period of last year. The consensus earnings estimate is unchanged in the past 60 days. Analysts also expect to see revenues of $2.7 billion, an increase of 4.8% from a year ago.

Note that Yum! Brands has topped consensus earnings estimates in recent quarters but it missed expectations by a penny per share in the first quarter. Analysts so far are looking for sequential and year-over-year growth of both earnings and revenue for the current quarter.

The Company

Louisville, Kentucky-based Yum! Brands is the world's largest quick-service restaurant operator (by number of locations) with around 37,000 restaurants in more than 100 countries and territories under the KFC, Pizza Hut, Taco Bell, Long John Silver's, and A&amp;W All-American Food Restaurants brands. Franchisees, affiliates and licensed operators run approximately three-quarters of the company's restaurants. Yum! Brands was founded in 1997.

During the three months that ended in June, the company took the first steps to acquiring China's Little Sheep restaurants, announced plans to bring free wi-fi to all U.S. Taco Bell locations, and brought the bunless Double Down sandwich back to KFC locations in Canada.

Performance

The long-term earnings per share growth forecast is 12.9%, the return on equity is 85.8%, and the dividend yield is 1.7%. The company's net cash flow from operations has grown in recent quarters, while short interest had fallen over the past year to about 1.2% of the float. The consensus recommendation of analysts is to buy the stock; 10 of 21 analysts following Yum! Brands rate its stock a Buy or Strong Buy.

The share price is more than 13% higher than at the beginning of the year. During that time, the stock has outperformed larger (by sales) competitor McDonald's (NYSE: <a class="ticker" href="/stock/mcd#NYSE">MCD</a>), as well as the industry average and the broader markets.

Action Items:

Bullish: Traders who are optimistic about the fast-food industry also might want to consider the following trades:

<ul><li>PowerShares Dynamic Food &amp; Beverage Portfolio (NYSE: <a class="ticker" href="/stock/pbj#NYSE">PBJ</a>): +10.4% year to date</li>
<li>PowerShares Dynamic Consumer Discretionary Sector Portfolio (NYSE: <a class="ticker" href="/stock/pez#NYSE">PEZ</a>): +9.1% year to date</li>
<li>Vanguard Consumer Discretionary Index Fund (NYSE: <a class="ticker" href="/stock/vcr#NYSE">VCR</a>): +8.9% year to date</li>
<li>Consumer Discretionary Select Sector SPDR Fund (NYSE: <a class="ticker" href="/stock/xly#NYSE">XLY</a>): +8.5% year to date</li></ul>

Bearish: Traders who believe that opportunities may be better in the commodities that supply the fast-food industry may want to consider these alternate positions:

<ul><li>Teucrium Corn Fund (NYSE: <a class="ticker" href="/stock/corn#NYSE">CORN</a>): +10.2% year to date</li>
<li>UBS E-TRACS UBS Bloomberg CMCI Livestock TR ETN (NYSE: <a class="ticker" href="/stock/ubc#NYSE">UBC</a>): +4.9% year to date</li>
<li>iPath Dow Jones-UBS Sugar Subindex Total Return ETN (NYSE: <a class="ticker" href="/stock/sgg#NYSE">SGG</a>): +4.1% year to date</li></ul>

Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.

Commodities

Restaurants

CORN

iPath DJ-UBS Sugar Subindex Total Return ETN

Yum! Brands Earnings Preview

No doubt times are tough for fast-food restaurants as they face higher commodity and production costs. Recently, privately held Sbarro filed for bankruptcy and Goldman Sachs downgraded the sector. Some companies have been able to offset growing costs with strategic price increases, and some, like Starbucks (NASDAQ: <a class="ticker" href="/stock/sbux#NASDAQ">SBUX</a>) and Sonic (NASDAQ: <a class="ticker" href="/stock/sonc#NASDAQ">SONC</a>), are experimenting with serving alcohol, which has worked out well for Buffalo Wild Wings (NASDAQ: <a class="ticker" href="/stock/bwld#NASDAQ">BWLD</a>).

Yet many fast food chains continue to perform well as cost-conscious consumers try to stretch a buck as they eat out. Here are eight fast-food stocks that are now trading near their 52-week highs.

Carrols Restaurant Group (NASDAQ: <a class="ticker" href="/stock/tast#NASDAQ">TAST</a>): The largest Burger King franchisee in the United States also operates the Taco Cabana and Pollo Tropical chains, but said it plans to spin off the latter two into a separate entity later this year. Analysts on average underestimated per-share earnings in the past three quarters, and the long-term EPS growth forecast is 10%. The stock hit a multiyear high of $10.97 per share yesterday; the share price is up more than 40% year to date.

CEC Entertainment (NYSE: <a class="ticker" href="/stock/cec#NYSE">CEC</a>): This Texas-based company owns and franchises more than 550 pizza parlors with family entertainment centers under the Chuck E. Cheese banner. The company recently changed its pizza recipe, featuring fresh dough, vegetables and cheese, to accommodate the changing tastes of parents and children. The share price is up about 12%, reaching a multiyear high of $42.71 recently. CEC also offers a dividend yield of about 1%.

Chipotle Mexican Grill (NYSE: <a class="ticker" href="/stock/cmg#NYSE">CMG</a>): Goldman Sachs named CMG as one of its top picks within the restaurant sector, helping to push shares to multiyear high of $329.80. Chipotle sports a strong balance sheet, consistent earnings, healthy cash flow and international expansion, but margins remain under pressure due to food cost inflation. The stock is more than 50% higher year to date, easily outperforming the restaurant industry average and the broader markets in that time.

Domino's Pizza (NYSE: <a class="ticker" href="/stock/dpz#NYSE">DPZ</a>): A new app for ordering pizza from your iPhone or iPod Touch makes Domino's even more convenient. And the company topped consensus earnings estimates in the most recent quarter by 22%, due in part to strong international sales. The share price has risen more than 60% since the beginning of the year. Domino's stock has outperformed competitor Papa John's (NASDAQ: <a class="ticker" href="/stock/pzza#NASDAQ">PZZA</a>) and the restaurant industry average in that time.

McDonald's (NYSE: <a class="ticker" href="/stock/mcd#NYSE">MCD</a>): After its burgers came out on the bottom of a national survey, McDonald's has begun testing an “English Pub” burger in some locations. But it is coffee sales and growth in Asia that have been the drivers for the stock. The share price hit a multiyear high of $86.29 yesterday after climbing more than 11% in the past three months. McDonald's has a dividend yield of 1.4% and a return on equity of 34.3%.

Nathan's Famous (NASDAQ: <a class="ticker" href="/stock/nath#NASDAQ">NATH</a>): Nathan's saw 40 new franchised units opened in the past year, including its first two restaurants in Beijing, China. The company also repurchased more than 575,000 of its shares last year. The share price is more than 12% higher than at the beginning of the year and is once again approaching the 52-week high of $19.50 it reached in February. The stock has outperformed the restaurant industry average and the broader markets year to date.

Wendy's (NYSE: <a class="ticker" href="/stock/wen#NYSE">WEN</a>): It just completed the sale of its troubled Arby's chain to Roark Capital Group. Wendy's says it plans to focus on revitalizing its core menu, modernizing facilities, and global expansion. After trading mostly between $4.50 and $5.00 per share since October, the stock has jumped more than 20% in the past month and reached a new 52-week high yesterday. The company has a 17.0% long-term earnings per share growth rate forecast, as well as a dividend yield of 1.0%.

Yum! Brands (NYSE: <a class="ticker" href="/stock/yum#NYSE">YUM</a>): Analysts expect the operator of KFC, Pizza Hut, Taco Bell and other popular chains to post year-over-year growth of both per-share earnings and revenues when it reports second-quarter results next week. The long-term earnings per share forecast of 12.9%. And the company also has raised its dividend every year since it was initiated in 2004. Shares opened today about a buck and half south of the recent multiyear high of $57.04.

Action Items:

Bullish:Traders who are optimistic about the fast-food industry also might want to consider the following trades:

<ul><li>PowerShares Dynamic Food &amp; Beverage Portfolio (NYSE: <a class="ticker" href="/stock/pbj#NYSE">PBJ</a>): +10.9% year to date</li>
<li>Vanguard Consumer Discretionary Index Fund (NYSE: <a class="ticker" href="/stock/vcr#NYSE">VCR</a>): +10.3% year to date</li>
<li>PowerShares Dynamic Consumer Discretionary Sector Portfolio (NYSE: <a class="ticker" href="/stock/pez#NYSE">PEZ</a>): +10.2% year to date</li>
<li>Consumer Discretionary Select Sector SPDR Fund (NYSE: <a class="ticker" href="/stock/xly#NYSE">XLY</a>): +9.6% year to date</li></ul>

Bearish: Traders who believe that opportunities may be better in the commodities that supply the fast-food industry might want to consider these alternate positions:

<ul><li>Teucrium Corn Fund (NYSE: <a class="ticker" href="/stock/corn#NYSE">CORN</a>): +10.1% year to date</li>
<li>iPath Dow Jones-UBS Sugar Subindex Total Return ETN (NYSE: <a class="ticker" href="/stock/sgg#NYSE">SGG</a>): +5.9% year to date</li>
<li>UBS E-TRACS UBS Bloomberg CMCI Livestock TR ETN (NYSE: <a class="ticker" href="/stock/ubc#NYSE">UBC</a>): +1.7% year to date</li></ul>

Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.

BWLD

NATH

PZZA

SBUX

SONC

TAST

Eight Fast-Food Stocks Trading Near 52-Week Highs

HEDJ

iShares FTSE EPRA/NAREIT North America Index Fund

IFNA

Merrill Lynch Internet Infrastructure HOLDRs Trust

PowerShares Active Low Duration Portfolio

RevenueShares Navellier Overall A-100 Fund

ETF Deathwatch for June 2011: Sixteen New Names

By and large, fast food restaurants continue to perform well as cost-conscious consumers still try to stretch a buck as they eat out. Though these companies also face higher commodity and production costs, some have been able to offset these costs with strategic price increases.

Here are seven fast food stocks that are now trading near their 52-week highs.

Chipotle Mexican Grill (NYSE: <a class="ticker" href="/stock/cmg#NYSE">CMG</a>): Better-than-expected first-quarter revenues rose 24.3 %, driven by new restaurant openings and growing same-store sales. Chipotle sports a strong balance sheet, consistent earnings, healthy cash flow and international expansion, but margins remain under pressure due to food cost inflation. Shares closed today at $284.11 after rising more than 33% since the beginning of the year. The stock has outperformed the restaurant industry average since the beginning of the year.

Domino's Pizza (NYSE: <a class="ticker" href="/stock/dpz#NYSE">DPZ</a>): The share price has risen more than 35% in the past month, following the report of better-than-expected first-quarter earnings. And recently, the company launched its first extended national carryout promotion: Monday through Wednesday deals. Domino's stock has outperformed competitor Papa John's (NASDAQ: <a class="ticker" href="/stock/pzza#NASDAQ">PZZA</a>) and the restaurant industry average since the beginning of the year. Analysts on average recommend buying DPZ.

Krispy Kreme Doughnuts (NYSE: <a class="ticker" href="/stock/kkd#NYSE">KKD</a>): The company's best quarterly earnings report in seven years prompted the stock to leap to a new multiyear high of $8.66 per share yesterday. Profits more than doubled and revenues jumped 14%, due in part to price increases. Krispy Kreme has a 50% long-term earnings per share forecast, as well as a PEG ratio of 0.6. Note that competitor Dunkin' Donuts has an impending initial public offering.

McDonald's (NYSE: <a class="ticker" href="/stock/mcd#NYSE">MCD</a>): The world's largest fast-food company has announced that it will remodel its stores in the United States with an eye toward increasing sales. Coffee sales and growth in Asia continue to be drivers for the stock. The share price hit a multiyear high of $83.08 yesterday after climbing more than 11% in the past three months. McDonald's has a dividend yield of 2.0% and a return on equity of 34.3%. The consensus recommendation of analysts remains to buy the stock.

Sonic (NASDAQ: <a class="ticker" href="/stock/sonc#NASDAQ">SONC</a>): The operator of the nation's largest chain of drive-in restaurants recently announced that same-store sales increased by 4% to 6% for the first two months of its third fiscal quarter. It also completed a $500 million refinancing transaction, and insiders bought more than 180K of shares in March and April. The stock is down less than a buck from the 52-week high of $11.86 per share. Sonic's return on equity is 44.1%.

Wendy's/Arby's Group (NYSE: <a class="ticker" href="/stock/wen#NYSE">WEN</a>): Like McDonald's, beverage sales and growth in Asia are drivers for this stock as well. Wendy's said it would reenter the Japanese market with a store in Tokyo expected to open later this year. Trading mostly between $4.75 and $5.15 per share since February, the stock is struggling to return to the 52-week high of $5.22. The company has a 17.3% long-term earnings per share growth rate forecast, as well as a dividend yield of 1.4%

Yum! Brands (NYSE: <a class="ticker" href="/stock/yum#NYSE">YUM</a>): The operator of KFC, Pizza Hut, Taco Bell and other popular chains has more than 3,900 stores in China, where same-store sales grew 13% in the first quarter. The company also has raised its dividend every year since it was initiated in 2004. Shares reached a multiyear high of $56.98 last week. Yum! Brands has a return on equity of 85.8% and a long-term earnings per share forecast of 12.8%. It also has increased its cash on hand in recent reporting periods.

Fast Food ETFs

If exchange traded funds are more your thing, here are five ETFs with significant exposure in fast food stocks:

PowerShares Dynamic Food &amp; Beverage Portfolio (NYSE: <a class="ticker" href="/stock/pbj#NYSE">PBJ</a>): +10.3% year to date

Vanguard Consumer Discretionary Index Fund (NYSE: <a class="ticker" href="/stock/vcr#NYSE">VCR</a>): +6.3% year to date

Consumer Discretionary Select Sector SPDR Fund (NYSE: <a class="ticker" href="/stock/xly#NYSE">XLY</a>): +6.2% year to date

PowerShares Dynamic Leisure &amp; Entertainment Portfolio (NYSE: <a class="ticker" href="/stock/pej#NYSE">PEJ</a>): +5.7% year to date

PowerShares Dynamic Consumer Discretionary Sector Portfolio (NYSE: <a class="ticker" href="/stock/pez#NYSE">PEZ</a>): +5.5% year to date

PowerShares ETF Leisure & Entertainment Port

Seven Fast Food Stocks Near 52-Week Highs

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By Raymond James
I recalled the lyrics “and a partridge in a pear tree” when an institutional account asked me for some “pair trade” ideas. Recall that “pair trading” is considered a market neutral strategy whereby you match a long position in one stock while selling short an equal dollar amount of another stock that is strongly correlated with the long stock position. Then, if the correlation weakens, hopefully your long position rises while your short position falls. For example, from our research universe a pair trade might consist of buying Regal Cinemas (NYSE: <a class="ticker" href="/stock/rgc#NYSE">RGC</a>) and selling short an equal dollar amount of Speedway Motorsports (NYSE: <a class="ticker" href="/stock/trk#NYSE">TRK</a>). For guidance, I called one of the smartest pair traders I know. His response was, “Don't do it!” “Why?” I asked. “Because correlations are as high as they have been since 1987,” he replied. Further research reveals that he's right, for arguably the best pair trading hedge fund in the business is down 11% year to date. Here's why.
The chart on page 3 shows the correlation of S&amp;P 500 stocks to the S&amp;P 500 Index. Studying the chart one finds that the correlation from September 2009 through early May 2010 ranged between 55 – 65. However, following the May 6th “flash crash” the correlation leaps to ~78 and eventually ~82, which is indeed the highest correlation since the 1987 crash. So what caused this fairly rare event? In my opinion it is because the retail investor – disgusted with high-frequency trading, dark pools, trading huddles, inter-market sweep orders, etc. – simply left the game, leaving the “pros” to trade among themselves. Obviously, when the alleged “dumb money” left the party correlation had to rise. Adding to the situation has been Exchange-Traded Funds (ETFs). To wit, when volume increases in say the Powershares Consumer Discretionary ETF (NYSE: <a class="ticker" href="/stock/pez#NYSE">PEZ</a>), that ETF automatically goes in and buys ALL 60 of the mid-cap stocks within the fund. Plainly, that causes correlation to rise.
Read the rest <a href="http://www.stockmarketsreview.com/extras/and_a_partridge_in_a_pair_tree_20100915_38641/">here.</a>