Top Takes From RealMoney

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Ruby Tuesday

By Tim Melvin
10:35 a.m. EDT

The report from Ruby Tuesday(RT Quote) was interesting, to say the least. The company exceeded Wall Street expectations. The biggest thing I gleaned from the report is that management is executing extraordinarily well in difficult conditions. As a result of closing 54 restaurants in the past year, expenses have dropped substantially. Management has focused on paying down debt, repaying $32.8 million in the quarter and $112 million in the year.

The stock originally leaped out of the gate this morning, but as reality set in, they tumbled back to earth. The plain truth is that management is doing a great job of controlling costs, but business is still terrible. Same-store sales were down 3.25% at company-owned stores and 6.9% at franchised locations. Overall revenue was down a little over 7%.

I am impressed by management's actions in cutting costs and managing cash flow, but I think we have some time before the underlying business gets better.

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Losing Traction on the Slope of Hope

By Dan Fitzpatrick
1 p.m. EDT

Just a quick heads-up about the heavy construction industry group. This former favorite of the momentum crowd has fallen from grace faster than Icarus on a hot summer day. If you're long, you are wrong -- really wrong.

I have been covering McDermott(MDR Quote) and Fluor(FLR Quote) for the past few days, and I don't think they are done sliding down the muddy slope of hope.

Positions: Short MDR, FLR

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Divergences

By Robert Marcin
3:09 p.m. EDT

Here we go again. A late-day, large-cap rally with lagging small-caps and mid-caps. Maybe that's the matched pair?

No positions

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