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If high end companies like American Express and Tiffany are slumping, then what’s the Yonder 40 supposed to do?
The 40 firms picked to reflect the rural economy fared better than Amex or Tiffany last week — both those firms plummeted — but the Yonder 40 still dropped a percent and is now 10 points lower than when the index began July 1. The 40 fared slightly better than the Dow Industrials (which fell a point and a half) and slightly worse than the S&P 500 (which dropped three-quarters of a percent). It was the third week in a row these indexes have fallen, and talk of a recession is front page news.
Only 16 of the 40 stocks on the rural index rose last week.
We’ll get back to the stocks shortly, but first, the most interesting business news of the week was about food from cloned animals. The US Food and Drug Administration is expected to declare, as early as this coming week, that meat and milk from cloned animals are safe to eat. At the same time, the European Food Safety Authority also declared that meat and milk from cloned pigs and cattle are “very unlikely” to pose any risk to consumers.
The possibility that food from cloned animals will be declared safe for eating has split companies in the Yonder 40. Dean Foods says it won’t sell any milk from cloned animals. Whole Foods Market (not a member of the 40) says it won’t carry any product from cloned animals. But both Dean Foods and Whole Foods say that it will be nearly impossible to track products from cloned animals once they are in the supply chain.
Most meat producers favor rules that would allow use of cloned products. The American Meat Institute, which represents Yonder 40 firms like Hormel Foods and Smithfield Foods, contends consumers, over time, will come to think more highly of food from cloned animals. “These animals are not some kind of freaks of nature,” says James Hodges, president of the Meat Institute.
Tyson Foods, a Yonder 40 member, says it currently has no plans to purchase cloned livestock.
There was other news in the last week from the companies in the Yonder 40.
“¢ Monsanto sold lots of Roundup herbicide to South America and reported fiscal first-quarter profits that tripled last year’s take. Sales rose 36 percent in the quarter that ended November 30. Monsanto’s stock also continued to rise early the in the year reaching a record high by the end of the week.
“¢ SkyWest, the Utah-based air carrier, said combined traffic in December rose 7.9 percent.
“¢ Retailers continued to suffer, as customers slowed. Stage Stores (down 11 percent in the week) cut its forecast. Cato Corp. (down 7 percent) reported that December comparable store sales fell 8 percent from a year ago. Family Dollar Stores (down 6.5 percent) predicted same store sales for January will be flat from last year. Cabella’s was down nearly 8 percent and Tractor Supply was off 4.4 percent. Only Wal-Mart, which saved its Christmas season by offering specials long before the season began, seemed to avoid losses, rising 4.4 percent last week.
“¢ Gaylord Entertainment (Opryland) fell 21 percent last year and 12 percent so far in 2008. The stock price has dropped low enough so that S&P has now slightly upgraded the stock.
“¢ One Yonder 40 company is buying into another. Berkshire Hathaway is buying more stock in the Burlington Northern rail line. Berkshire now owns 17.6 percent of the Fort Worth, Texas, company.
The complete Yonder 40 results for the week ending January 11, 2008, are below:
| Companies | Ticker | Price January 11 | Price Change for Week | Percent Change for Week |
| Alico Inc. | ALCO | $38.25 | $1.80 | 4.9% |
| Andersons Inc. | ANDE | $46.16 | -$0.60 | -1.3% |
| Burlington Northern Santa Fe Corp. | BNI | $78.11 | -$0.53 | -0.7% |
| Berkshire Hathaway | BRKB | $4,377.00 | -$173.00 | -3.8% |
| Bassett Furniture | BSET | $10.40 | $0.40 | 4.0% |
| Peabody Energy Corp. | BTU | $55.44 | -$2.34 | -4.0% |
| Cabela’s Inc. | CAB | $12.75 | -$1.07 | -7.7% |
| ConAgra Foods Inc. | CAG | $23.68 | $0.70 | 3.0% |
| Cato Corp. Cl A | CTR | $13.53 | -$1.06 | -7.3% |
| Citizens Communications | CZN | $11.28 | -$0.78 | -6.5% |
| Deere & Co. | DE | $89.26 | -$0.72 | -0.8% |
| Dean Foods Co. | DF | $24.97 | $0.47 | 1.9% |
| DIRECTV Group | DTV | $21.72 | $0.14 | 0.6% |
| Family Dollar Stores Inc. | FDO | $15.90 | -$1.10 | -6.5% |
| Fleetwood Enterprises Inc. | FLE | $5.13 | -$0.52 | -9.2% |
| FairPoint Communications | FRP | $12.83 | $0.87 | 7.3% |
| Gaylord Entertainment Co. | GET | $31.61 | -$4.91 | -13.4% |
| Hormel Foods | HRL | $40.48 | $0.81 | 2.0% |
| International Speedway Corp. | ISCA | $40.43 | $0.17 | 0.4% |
| Lee Enterprises | LEE | $11.10 | -$0.76 | -6.4% |
| Mohawk Industries Inc. | MHK | $70.01 | -$1.36 | -1.9% |
| Monsanto Co. | MON | $120.63 | $1.00 | 0.8% |
| Mine Safety Appliances Co. | MSA | $48.48 | -$0.51 | -1.0% |
| Southwest Bancorp | OKSB | $16.63 | -$0.39 | -2.3% |
| Plum Creek Timber REIT | PCL | $40.96 | -$0.63 | -1.5% |
| Penn Virginia Corp. | PVA | $43.92 | $0.61 | 1.4% |
| Ralcorp Holdings | RAH | $55.34 | -$3.74 | -6.3% |
| Regions Financial Corp. | RF | $20.47 | -$0.33 | -1.6% |
| Sturm Ruger & Co. | RGR | $7.70 | -$0.41 | -5.1% |
| Smithfield Foods | SFD | $26.37 | -$0.49 | -1.8% |
| Skywest Inc. | SKYW | $24.58 | -$1.72 | -6.5% |
| Southern Co. | SO | $39.76 | $1.05 | 2.7% |
| Stage Stores Inc. | SSI | $11.00 | -$1.38 | -11.1% |
| Tractor Supply Co. | TSCO | $30.54 | -$1.39 | -4.4% |
| Tyson Foods | TSN | $14.12 | $0.21 | 1.5% |
| UST Inc. | UST | $56.26 | $2.19 | 4.1% |
| Waddell & Reed Financial Inc. | WDR | $32.48 | -$0.95 | -2.8% |
| Walter Industries | WLT | $37.40 | $3.49 | 10.3% |
| Wal-Mart Stores | WMT | $47.72 | $2.00 | 4.4% |
| Cimarex Energy | XEC | $43.36 | $1.45 | 3.5% |
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