This morning I wrote about an honest economic indicator: beer. Then I read Hologic's conference call transcript, and was hit with another indicator: breasts. Hologic is a big player in the female health space, specializing in breast imaging systems and their peripheries. I'm long HOLX stock, with the basic thesis being one that was mentioned in the transcript: "the inclusion of additional lives entering the healthcare system and an emphasis on early detection and prevention could result in increased exams."
However, HOLX guided conservatively for the year, as they noted:
"Relative to the second quarter last year, we have heard from many of our customers that there was a slight reduction in a number of screening mammography, and as a result, a reduction in biopsy procedures. We believe this is primarily due to the high levels of unemployment and resetting deductibles and co-pays, leading to the decreased wellness business"
Come on now. If the economy is recovering so rapidly, then why are women cutting essential expenses like breast cancer screening? Also, note, that they are talking about lower levels from what should have been an easy comparison in the 2009 comparable quarter.
Then, just when I thought I had another key data point figured out (bearish!), my wife returned from a trip to downtown Concord where she checked in with a high end candy store in town that specializes in candy apples coated in a variety of fancy products, which sell for about $5 each. She brought me back a piece of the new product: chocolate covered BACON - which is selling for $2 a strip. My wife even got some channel checks from the store owner, asking if people were pretty much buying them as novelties. The response was that people buy one in the store, and then buy 6 more to take home! If people spending $2/piece on chocolate covered bacon isn't a bullish indicator, I don't know what is... By the way - I know chocolate sounds good, and bacon sounds good, but chocolate covered bacon is mediocre at best.
So, we have bearish beer indicators from MolsonCoors, bearish breast indicators from Hologic, and bullish bacon indicators from the Concord candy store... I guess we'll continue to play the wait and see game.
note: I am long HOLX stock. Also note: this post is certainly not intended to make light of breast cancer, and I hope that no readers are ignorant enough to read it in that way.