There are no safe havens in the stock market. Every stock carries risk. But some less than others. This column features stocks that have shown one or more of the following characteristics: less volatility, better earnings, larger market caps, safe and increasing dividends. In these times of turmoil, our goal is to show readers better opportunities for investing with fewer risks.

November 3, 2009 - Weis Markets, Inc. (WMK-NYSE) engages in the retail sale of food items. Its retail stores offer groceries, dairy products, frozen foods, meats, seafood, fresh produce, flowers, prescriptions, deli/bakery products, prepared foods, fuel, and general merchandise items, such as health and beauty care, and household products.

Weis's earnings will be up to $2.40 this year, well ahead of the $1.74 made in 2008. Next year, look for $2.55. That's with very little revenue growth (2008 was $2.422 billion; this year 1 analyst sees $2.52 billion; next year, $2.70 billion). With minor revenue growth the company still boosted earnings noticably, mostly because of lower fuel costs and reductions in shrink, a grocery term that means planned losses due to stolen food, expired food, prepared food that needs to be thrown out, etc. For the third quarter earnings, look for 65 cents a share, up from 63 cents last year, then in the fourth period, expect 64 cents, a little ahead of 61 cents in last year's fourth.

The company has done well, in spite of consumers changing their spending habits on food and competition lowering prices on most products. But Weis can't be immune from these pressures forever. The concern is that competition will eventually force Weis to lower its prices even more, making future profits less robust.

Part of management's answer to this problem is to expand. In the summer it bought a grocery chain in southern New York near the Pennsylvania border. There were 12 stores. No debt was used for the purchase because the company has ample cash. Total capital expenditures for 2009 will come in around $80 million, including the new chain purchase. There is still $112 million in cash for further acquisitions, stock buy backs, and/or dividends.

More numbers: Trailing P/E is 14.77 while the Forward P/E is 13.82. Price to sales is .39 while Price to book is 1.41. Operating margin for the last 12 months was 4.01% and the Profit margin was 2.61%. Book value is $25.09 per share.

This stock traded at $47.10, an all time high, in 2007 when earnings were $1.69 a share. Now with earnings set to reach new highs, the stock has a chance of doing the same. But there have been some management changes lately. There's a new CEO, David Hepfinger, who's been with the company less than one year. There's also a new manager for sales and merchandising. Plus there's a need for a new CFO. Sometimes these changes can be very good for a company. Sometimes not.

- Company Web site: www.weis.com

Ted Allrich