Wayne Weaver will find himself in an unusual position once the pending sale of the Jacksonville Jaguars is completed.
“It’s the first time in 60 years, in January, that I won’t have a job,” Weaver said last week in a telephone interview.
Officially, Weaver still has another job as chairman of footwear chain Shoe Carnival Inc. His family is the largest shareholder of the company with 26.8 percent of the stock. But other than attending board meetings, Weaver said he doesn’t spend much time at Shoe Carnival’s Evansville, Ind., headquarters.
“I still love the business I grew up in, but they don’t need me hanging around,” he said.
“I’ve got a great management team. I think I’ve got the best management team in the industry,” Weaver said.
While we all know him as the majority owner of the Jaguars since the franchise was awarded by the NFL in 1993, Weaver’s job for most of the past 60 years has been in shoes. He started by rising through the ranks of Brown Group Inc., then joined Nine West Group Inc. as CEO in 1978.
He left Nine West in early 1993 before becoming the lead partner in the group that obtained the Jaguars’ franchise.
He remained in the footwear business after acquiring control of Shoe Carnival in 1989, and he took Shoe Carnival public in 1993 (it was a busy year for Weaver).
Weaver feels good about Shoe Carnival, and he completely dismissed a report on Forbes magazine’s website that suggested the sale of the Jaguars was somehow tied to a recent drop in Shoe Carnival’s stock price.
“Our balance sheet is the most enviable in the industry,” he said.
Shoe Carnival’s stock dropped in August after the company reported third-quarter earnings of 20 cents a share, 10 cents lower than the average forecast of analysts surveyed by Thomson Financial. The company last month reported third-quarter earnings rose by 8 cents a share to 78 cents, matching analysts’ forecasts.
The third-quarter report helped lift the stock from a 52-week low of $19.19 in November to above $23 last week, but the stock still has a way to go to return to its 52-week high of $34.05 in July.
Avondale Partners analyst Mark Montagna said in a research note that weather trends have had a big impact on Shoe Carnival’s recent performance.
“We believe Shoe Carnival is more impacted by unseasonable weather than footwear retailers targeting a higher demographic. That is because the average household income for a Shoe Carnival customer is $35,000-$65,000. That customer has nearly zero discretionary income. Retailers targeting a higher demographic can withstand unfavorable weather to a greater degree,” Montagna said.
Besides the outlook for Shoe Carnival, Weaver also is feeling good about the Jaguars’ prospects despite a string of losses this season. He pointed out that the Jaguars have the fifth-rated defense in the league, even after losing a number of players to injury. And despite Blaine Gabbert’s struggles, Weaver said he’s seen some good things from the rookie quarterback.
“We’re not that far away,” Weaver said.
“We’ll hopefully get this team back on a winning streak.”
He said he’s “bittersweet” about selling the team now, but he’s having no second thoughts.
“It’s the right time,” he said.
Good return on Jaguars investment
By the way, in case you haven’t done the math, Weaver and the minority partners of the Jaguars are receiving a pretty good return on their initial investment. The partnership paid a $140 million franchise fee when they were awarded the team and if the reports are correct that Shahid Khan is paying $760 million to buy the team now, that means the partners are getting a 443 percent return.
Meanwhile, the Standard & Poor’s 500 index has risen by a mere 172 percent since Nov. 30, 1993, the day the Jaguars’ partners were awarded the franchise.
Investors speculate on Taleo
Three years after acquiring Jacksonville-based Vurv Technologies Inc., Taleo Corp has become the target of takeover speculation itself in the wake of another big merger of business software companies.
California-based Taleo’s stock surged by as much as $8.27 to a record high 41.23 last Monday after German software company SAP AG agreed to buy a Taleo rival, SuccessFactors Inc. The buyout price of $40 a share was 52 percent higher than SuccessFactors’ market price.
That deal led to speculation that SAP rival Oracle Corp. might make a play for Taleo.
“The cloud software sector is being consolidated faster than we were expecting, and in our view, most investors will likely conclude that Taleo is the most obvious acquisition candidate and that Oracle is the most obvious buyer,” BMO Capital Markets analyst Karl Keirstead said in a research note.
Keirstead raised his rating on Taleo from “market perform” to “outperform” after the SuccessFactors deal, but he said the upgrade goes “beyond near-term takeout speculation.” He said investors will notice Taleo’s low valuation (before last week’s stock jump) and growth.
“We also believe that Taleo may end up as a net beneficiary of the deal as rival SuccessFactors goes through the normal post-deal turmoil, as hiring top sales staff becomes easier, and given Taleo’s independent status,” he said.
Taleo acquired Vurv in 2008, merging two companies that provide “talent management software.” The company currently has about 175 employees in Jacksonville
Glitch increases Stein Mart loss
Stein Mart Inc. last week announced that, because of a computer glitch, its third-quarter loss was even bigger than it previously reported.
The Jacksonville-based fashion retailer last month reported a loss of 4 cents a share in the quarter. The company said because of the technology error, markdowns in the quarter were understated and additional markdowns will increase the loss by 3 to 4 cents a share.
Stein Mart said the problem was a “planned but improperly executed one-time override of an automated records purge process.”
Landstar increases forecast
Landstar System Inc. CEO Henry Gerkens last week increased the Jacksonville-based trucking company’s fourth-quarter earnings forecast from 62 cents to 67 cents a share to a range of 64 cents to 69 cents.
He also said the company expects a 2-cent-a-share benefit from a lower effective tax rate, which would account for the higher forecast.
Still, in his mid-quarter update to investors, Gerkens said trends in volume and pricing are positive.
“We close out 2011 with much confidence and look forward to 2012 with great optimism. I believe we have created a platform for continued future growth in 2012,” he said.
ParkerVision a top performer among low-priced stocks
It’s always risky but if you play your cards right, you can sometimes make a lot of money in low-priced stocks.
ParkerVision Inc.’ stock has been trading at about $1 recently. But investing website TheStreet.com last week said that the Jacksonville-based company has been one of this year’s best-performing stocks priced under $5. Through Dec. 2, ParkerVision’s stock had a total return of 120 percent, making it sixth best on the list.
But the story also noted that “TheStreet Ratings gives ParkerVision a ‘sell’ based on ‘generally disappointing historical performance in the stock itself and poor profit margins.’ “
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