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WINN-DIXIE SHARES HIT NEW LOW

JACKSONVILLE, Fla. -- Shares of Winn-Dixie's stock plunged to a 10-year low last week, exacerbating a decline that began after the company reported a fourth-quarter loss of $22.72 million on Aug. 19."We believe the commentary from the company was pretty morbid," said Robert Campagnino, analyst, Prudential Equity Group, New York, in a research note last week. "For example, the notion that financing

JACKSONVILLE, Fla. -- Shares of Winn-Dixie's stock plunged to a 10-year low last week, exacerbating a decline that began after the company reported a fourth-quarter loss of $22.72 million on Aug. 19.

"We believe the commentary from the company was pretty morbid," said Robert Campagnino, analyst, Prudential Equity Group, New York, in a research note last week. "For example, the notion that financing ongoing initiatives would require improving sales trends."

Campagnino also speculated that Ahold's confident statements last month about its Bi-Lo and Bruno's chains being sold to a single buyer might be putting pressure on Winn-Dixie. If Bi-Lo and Bruno's, which overlap with Winn-Dixie in several markets, are sold to a single investor group, the new ownership could transform Bi-Lo and Bruno's into more aggressive players in the region, he said.

"To the extent that investors may have hoped that Ahold's announced exit from various trade areas in the Southeast would have lessened competition, we believe that the sale of the assets as a single unit would argue against that, and perhaps be a catalyst for competition intensifying," he wrote in the note.

Whether or not Ahold succeeds in selling Bi-Lo and Bruno's to a single buyer, Campagnino said Winn-Dixie is still "in a fight for its life."

Winn-Dixie's stock hit a 10-year low of $3.95 per share early last week, but bounced back somewhat. Campagnino has a $1 price target on the company.

Other analysts said they were uncertain why Winn-Dixie's stock took such a dive last week, although some reports suggested that portfolio managers might have been unloading shares as part of end-of-month adjustments to their holdings.

"There's been no recent news," said one analyst, who asked not to be identified. "There's been heavy volume in trading, and we're trying to figure out why."

Winn-Dixie earlier this year unveiled a plan to shed 156 stores as part of a restructuring effort, but analysts have said its efforts to sell those stores may be impeded by the fact that Bi-Lo and Bruno's are also on the selling block.