Market Could Be Setting Itself Up for a Pullback (GMCR, OPEN, K, AGN, MCP)

Stocks tumbled on the day after uninspiring economic data and generally lackluster earnings. Commodities, meanwhile, continued to head lower, once again led by a big decline in silver prices. The market could be setting itself up for a bit of a pullback, but we think the deflating of commodity prices will ultimately be good for the economy and thus much of the market. We think the “summer” months could be a good time to buy stocks if the market does indeed continue to drift lower.

The Coffee Stocks Index was the top performing tickerspy Index on the day, led by Green Mntn Coffee Roaster (GMCR) with a 19% gain. The Rare Earth Stocks Index was the day’s worst performing tickerspy Index, with Molycorp (MCP) down -7%.

Stocks slipped on the day, with the Dow falling -84 points to 12,724. The S&P lost -9 points to close at 1,347, while the Nasdaq dipped -13 points to 2,828. Oil dropped -$1.81 to $109.24 a barrel, while gold tumbled -$25.10 to $1,515.30 an ounce.

In economic news, ADP reported that just 179,000 private sector jobs were added in April, well short of the 200,000 economists were expecting. The Labor Department releases its April jobs report on Friday. Elsewhere, the Institute for Supply Management said its services index fell to 52.8 in April from 57.3 in March and below the 57.6 economists were forecasting. Readings above 50 are considered positive.

In earnings news, shares of Green Mountain Coffee Roasters surged 18.6% after the Vermont-based company’s raised its full-year outlook and posted fiscal second-quarter results that beat estimates. For the fiscal second quarter, Green Mountain earned $65.4 million, or 44 cents per share, compared with $24.1 million, or 17 cents per share, a year earlier. Revenue more than doubled to $647.7 million. Excluding one-time items, Green Mountain earned 48 cents a share. Analysts were expecting a profit of 37 cents on sales of $627.9 million. The company forecast a full-year profit of $1.43-$1.50 a share, topping the $1.23 analysts were expecting and easily surpassing previous guidance of $1.19-$1.29 a share. Twenty pros held Green Mountain in their portfolios at the end of 2010 and nearly 450 tickerspy members own the stock in their portfolios.

Shares of OpenTable (OPEN), the provider of restaurant reservation services, slid -14.9% after the company said CFO Matthew Roberts will become CEO in June, replacing Jeffrey Jordan. California-based OpenTable posted a first-quarter profit of $4.2 million, or 17 cents a share, compared with $2.5 million, or 11 cents a share, a year earlier. Revenue climbed 59% to $33.7 million. Excluding one-time items, OpenTable earned 28 cents a share. Analysts were expecting a profit of 23 cents on revenue of $33.6 million.

Kellogg (K), the world’s largest cereal maker, said its first-quarter profit fell -12% to $366 million, or $1.00 per share, for the quarter, down from $418 million, or $1.09 per share, a year earlier due to higher commodities prices. Revenue rose 5% to $3.49 billion. Analysts were expecting a profit of $1.04 a share on revenue of $3.39 billion. The company said it expects full-year revenue growth of 4% and profit growth in the low single digits. That implies earnings of $3.33-$3.40 a share. Analysts were expecting a profit of $3.48. Shares of Kellogg fell -1.2%.

Allergan (AGN), the maker of Botox, said its first-quarter profit fell -6% to $158.3 million, or 51 cents per share, from $167.9 million, or 55 cents per share, a year earlier. Excluding one-time items, California-based Allergan earned 77 cents a share. Revenue jumped 10% to $1.27 billion. Analysts were expecting a profit of 74 cents on revenue of $1.21 billion. The company raised its full-year profit outlook to $3.56-$3.62 a share from $3.54-$3.60 and boosted its revenue guidance to $5.05-$5.25 billion from $5.02-$5.22 billion. Analysts had expected a profit $3.61 a share on sales of $5.21 billion. For the second quarter, Allergan expects to earn 93-95 cents a share on revenue of $1.31-$1.36 billion. Analysts were expecting a profit of 92 cents on revenue of $1.31 billion. Shares of Allergan rose 2.4%. Nearly 30 pros held Allergan in their portfolios at the end of 2010 and nearly 130 tickerspy members own the stock in their portfolios.

Tags: AGN, GMCR, K, MCP, OPEN