Monday, March 29, 1999


Chiquita stock drops back after recent surge

The Cincinnati Enquirer

        The stock of Chiquita Brands International has given back some recent gains after spiking 33 percent in price earlier this month.

        The Cincinnati-based banana company peaked at $11.75 March 16, spurting up from $8.81 March 4. It has lost some steam since, closing Friday at $10.121/2.

        “Maybe there is an interpretation that all the EU (European Union) governors resigning en masse will delay the resolution process,” Tim Ramey, an analyst at Deutsche Bank Securities who is bullish on Chiquita, said last week. “I'm not aware of any directly related corporate reasons it would have sold off.”

        Mr. Ramey remains optimistic about Chiquita. He has a 12-month price target of $15 on the stock.

        Investors started snapping up Chiquita shares this month amid expectations that the European Union might soon loosen its discriminatory restrictions on banana imports from U.S. providers — namely Chiquita.

        The restrictions cut Chiquita's once-dominant 40 percent market share in Europe in half, decimated profits and obliterated its stock.

        In mid-March, though, the European Union surprised the world when its 20-member executive body resigned. The move has left political pundits to wonder how the mass resignations might hamper EU and U.S. trade talks over bananas and other issues. The commissioners have said they will stay on until replacements are found.

        The United States plans to slap tariffs on an estimated $500 million in EU imports in retribution if the European Union does not change its banana policy to comply with World Trade Organization rulings.

        Mr. Ramey's upgrade to “buy” from “hold” on Chiquita shares gave the stock its first boost. The issue rose to $10.31 from $8.811/4 March 5, the day of the new recommendation. Mr. Ramey had been negative on Chiquita since 1991.

        Another boost came March 10 when Salomon Smith Barney analyst Donald Zwyer picked up new coverage of Chiquita with an “outperform” rating and a 12-month price target of $12 a share.

        Chiquita shares, which peaked at $50.75 in late 1991, have traded mostly between $10 and $18 throughout the 1990s. The issue fell to a low of $7.94 in February.

Bright Trading opens in Cleveland
        Bright Trading has opened an office in Cleveland, its second Ohio location.

        The first Ohio office, in Blue Ash, has been open just over a year and recently expanded to accommodate as many as 24 traders.

        Las Vegas-based Bright now has 26 offices in 12 states.

        Joe Phoenix, a former environmental engineer, will manage the Cleveland office at 1 Cleveland Center, 1375 E. Ninth St., Suite 2260. The office opened last week with nine traders and has room for 26. Call (216) 621-5678 for more information.

Scudder Kemper promotes Newell
        Valerie Newell, director of the Cincinnati office of Scud der Kemper Investments, has been promoted to a managing director of the company.

        Managing director is the second-highest ranking corporate officer position at Scudder below senior managing director. There are 157 managing directors among Scudder's 4,500 worldwide employees. Previously, Ms. Newell was a senior vice president. She remains in Cincinnati.

        Scudder manages about $6.5 billion in assets for high net-worth individuals and institutions in Greater Cincinnati.

        Scudder Kemper is 70 percent owned by Zurich Insurance of Zurich, Switzerland. The remaining 30 percent ownership stake is held by Scudder's 350 partners.

        Ursula Miller covers financial markets and investments for the Enquirer. She can be reached at 768-8573.


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