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Showing posts with label Sara Lee. Show all posts
Showing posts with label Sara Lee. Show all posts
Tuesday, May 29, 2012
Investopedia: Hormel Doing Better Than Most
These aren't easy times for food companies, as rising input prices push up costs and shoppers rebel against price increases. Hormel Foods (NYSE:HRL)
seems to be holding up better than most, though, as the company's
expense control and increased focus on processed/packaged goods pays
benefits. Hormel looks like one of the best long-term stories in food
right now, but the valuation means that investors shouldn't expect
outsized capital gains from the shares.
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Wednesday, March 28, 2012
Seeking Alpha: Brasil Foods - An Emerging Titan With Hefy Expectations
Being a titan always seems to come with strings attached - Atlas had to bear the weight of the world, Prometheus ended up chained to a rock, and Brasil Foods (BRFS) carries the burden of sky-high expectations. While it is indeed a good thing to be the second-largest food company in Brazil and one of the ten largest in the world, Brasil Foods' current valuation practically demands excellence if shareholders are going to see market-beating returns from this point.
Disappointing Q4 Results Highlight A Key Vulnerability
On the whole, Brasil Foods had a pretty mixed fourth quarter. Revenue did rise 11%, but higher production costs and salaries pulled EBTIDA down 4% compared to the prior year.
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Brasil Foods - An Emerging Titan With Hefty Expectations
Disappointing Q4 Results Highlight A Key Vulnerability
On the whole, Brasil Foods had a pretty mixed fourth quarter. Revenue did rise 11%, but higher production costs and salaries pulled EBTIDA down 4% compared to the prior year.
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Brasil Foods - An Emerging Titan With Hefty Expectations
Friday, March 23, 2012
Investopedia: ConAgra Still Getting A Lot Of Benefits Of The Doubt
It's interesting to see how analysts and institutions will sometimes prioritize future expectations over past performance. For much of its recent history, ConAgra (NYSE:CAG) has been a poorly-run packaged food company, lagging almost of all of its peers in terms of returns on capital, margins and stock market performance.
Nowadays, though, it's a somewhat popular pick on the Street. Major brokerages like Bank of America, Barclays, Citi and Wells Fargo all have "Buy" ratings on the stock and analysts seem to be buying the story that ConAgra's management has a new plan in place that will drive substantially better results. Investors may do well to be a little more skeptical. (For related reading, see Cozying Up To Kraft.)
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Thursday, December 29, 2011
Seeking Alpha: Can Brasil Foods Hit Some Impressive Goals?
Brazilian meat company BRF-Brasil Foods (Nasdaq: BRFS) has had a solid run already. Basically a marriage of convenience between Perdigao and Sadia prompted by hideous derivative losses at Sadia, Brasil Foods has nevertheless formed itself into an impressive Brazilian food concern with significant export prospects. Perhaps even more to the point, in a year where most Brazilian equities fared quite badly indeed, this one did fairly well. Of course, the more important consideration is whether there's money to be made yet from this name.
A Known Quantity In A Major Emerging Market
Although far from a household name in the United States, Brasil Foods is in some respects a Brazilian version of Tyson Foods (NYSE: TSN). Like Tyson, Brasil Foods operates in a variety of protein markets, including chicken, beef and pork. Unlike Tyson, and perhaps more like Hormel (NYSE: HRL) or Sara Lee (NYSE: SLE), Brasil Foods has a sizable branded business as well.
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Can Brasil Foods Hit Some Impressive Goals?
A Known Quantity In A Major Emerging Market
Although far from a household name in the United States, Brasil Foods is in some respects a Brazilian version of Tyson Foods (NYSE: TSN). Like Tyson, Brasil Foods operates in a variety of protein markets, including chicken, beef and pork. Unlike Tyson, and perhaps more like Hormel (NYSE: HRL) or Sara Lee (NYSE: SLE), Brasil Foods has a sizable branded business as well.
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Can Brasil Foods Hit Some Impressive Goals?
Monday, December 12, 2011
Investopedia: Don't Pig Out On Smithfield Foods
With export demand running strong and grain prices easing, protein producers like Smithfield (NYSE:SFD), Tyson (NYSE:TSN) and Pilgrim's Pride (NYSE:PPC) have been strong this fall. The trouble, though, is that a strong run doesn't erase a basic problem with these companies - they seldom ever earn much (if anything) above their cost of capital, and it's difficult to argue paying any premiums to book value to own these shares.
Less Bad Is Good for the Second Quarter
Smithfield's second quarter highlights how strange the Wall Street world can be, as the company's performance in absolute terms was not all that great. Performance was better than expectation, though, so it will go down as an all-in-all solid performance.
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Less Bad Is Good for the Second Quarter
Smithfield's second quarter highlights how strange the Wall Street world can be, as the company's performance in absolute terms was not all that great. Performance was better than expectation, though, so it will go down as an all-in-all solid performance.
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Friday, November 25, 2011
Investopedia: Hope For Hormel To Get Cheaper
The trouble with quality food companies is that they rarely get cheap, and when they do it's often because of some significant erosion in the fundamentals. That's the case today with Kellogg (NYSE:K), as cutting too deeply as part of a cost restructuring program, has sapped some of the almost-legendary reliability of that company's earnings stream. Perhaps counter-intuitively, investors may need to hope for something similar at Hormel (NYSE:HRL). This is an excellent company in many respects, but it's hard to argue for chasing the stock at these prices.
The End of the Year was Better than It Seems
At first look, it may seem that Hormel's quarter was a laggard, compared to the likes of Sara Lee (NYSE:SLE) or Tyson (NYSE:TSN). Certainly, revenue growth of just 2% does not look all that impressive and it would seem that stronger pricing (up 9%) killed volume (down 7%). All is not always at it seems though; Hormel's volume decline had everything to do with one less week in the quarter and was otherwise basically stable, a result much more in line with its comparables.
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Thursday, November 24, 2011
Investopedia: Tyson Already Looks Overcooked
When last I reviewed Tyson Foods (NYSE: TSN), I commented that it would be an interesting stock to buy around one times book value. As it turns out, the stock briefly touched that level and had a decent run from there. Now, though, it seems there are growing expectations of improvement in the chicken market and sustainable profitability in beef and pork; so much so that there really doesn't seem to be much upside left in these shares.
Familiar Challenges Close Out the Fiscal Year
A lot of what went on in Tyson's fiscal fourth quarter will sound familiar. Sales growth looked impressive at nearly 13%, with very strong price growth in excess of 12% and very modest volume growth of less than 1%. Top line growth was led up an impressive 16% in beef, where prices rose almost 19%, and 14% in pork. Chicken revenue rose a more sedate 9% and prepared food revenue rose less than 4%, on a nearly 3% decline in volume.
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Familiar Challenges Close Out the Fiscal Year
A lot of what went on in Tyson's fiscal fourth quarter will sound familiar. Sales growth looked impressive at nearly 13%, with very strong price growth in excess of 12% and very modest volume growth of less than 1%. Top line growth was led up an impressive 16% in beef, where prices rose almost 19%, and 14% in pork. Chicken revenue rose a more sedate 9% and prepared food revenue rose less than 4%, on a nearly 3% decline in volume.
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Monday, November 21, 2011
Investopedia: How Green Are The Acres At Adecoagro?
It feels like a little bit of the bloom is off the rose that is farmland. About a year ago, farmland was one of the most talked-about investment options, and investors scoured the markets for names like Cresud (Nasdaq:CRESY), Bunge (NYSE:BG) and Syngenta (NYSE:SYT) to find some exposure to the market. While investors no longer have quite the same enthusiasm for these names, patient investors may want to come back around to Adecoagro (NYSE:AGRO). Agriculture is a tough, low-margin business, but short of putting together the considerable capital it takes to buy farmland, Adecoagro may be the next best thing for playing the increasing scarcity of arable land.
An Ok Third Quarter
Variabilities in yields, pricing, forex and futures contracts make this company's quarter-to-quarter performance absurdly volatile, so a longer-term perspective is arguably best. Nevertheless, revenue rose 31% from last year, powered by 46% growth from farming operations and 24% growth from other activities, like sugar and ethanol processing.
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An Ok Third Quarter
Variabilities in yields, pricing, forex and futures contracts make this company's quarter-to-quarter performance absurdly volatile, so a longer-term perspective is arguably best. Nevertheless, revenue rose 31% from last year, powered by 46% growth from farming operations and 24% growth from other activities, like sugar and ethanol processing.
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Thursday, November 3, 2011
Investopedia: Has Kraft Saved The Best For Last?
One of the sell-side analysts whom I follow, has made the comment before that Kraft (NYSE:KFT) has long struggled to walk and chew bubblegum at the same time. Now in the wake of the company's announcement that it will split up, it feels a little ironic that the pieces seem to be working together a little better. Although Kraft shares don't represent a huge value today, investors could see trading opportunities around the split, as institutional shareholders choose sides between the higher-growth snack business and the higher-income grocery business.
A Solid Third Quarter
Maybe it seems strange to get excited that Kraft beat its revenue estimate by 3%, but with a company of this size, where sales data is available on a monthly, or weekly basis, there usually isn't all that much wiggle room. All the same, Kraft reported that revenue rose almost 12% with organic growth of over 8%. Overseas markets are driving good growth as well, as North American revenue was up just a bit more than 4%. One interesting note is that Kraft posted over 1% growth in volume and 7% growth in prices, suggesting that customers are finally accepting higher prices and sticking with brands they like, despite the hikes.
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A Solid Third Quarter
Maybe it seems strange to get excited that Kraft beat its revenue estimate by 3%, but with a company of this size, where sales data is available on a monthly, or weekly basis, there usually isn't all that much wiggle room. All the same, Kraft reported that revenue rose almost 12% with organic growth of over 8%. Overseas markets are driving good growth as well, as North American revenue was up just a bit more than 4%. One interesting note is that Kraft posted over 1% growth in volume and 7% growth in prices, suggesting that customers are finally accepting higher prices and sticking with brands they like, despite the hikes.
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Friday, October 14, 2011
Investopedia: PepsiCo Really Close Now
If there's anything good about widespread market routes, it's that they can often bring expensive stocks back to a more palatable price. That's perhaps the most significant takeaway from PepsiCo's (NYSE:PEP) third quarter earnings; while business continues to move along apace, the stock is finally at a point where long-term investors may see some real value.
A Decent Fiscal Third Quarter
The market seemed to be girding itself for a bad performance, but PepsiCo did alright. Revenue rose more than 13% as reported, with organic growth in excess of 5%. With worldwide organic snack volume growth of 3%, and beverage volume growth of 1%. It's clear that Pepsi products are still finding their way into shopping carts, but the company hasn't really pushed as hard on pricing as other food and beverage companies.
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A Decent Fiscal Third Quarter
The market seemed to be girding itself for a bad performance, but PepsiCo did alright. Revenue rose more than 13% as reported, with organic growth in excess of 5%. With worldwide organic snack volume growth of 3%, and beverage volume growth of 1%. It's clear that Pepsi products are still finding their way into shopping carts, but the company hasn't really pushed as hard on pricing as other food and beverage companies.
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Monday, September 12, 2011
Investopedia: Smithfield's Leverage High On The Hog
Take an unpredictable and cyclical business with narrow margins and then layer on a big dollop of debt and let the fun ensue. That's basically the recipe for Smithfield Foods (NYSE: SFD), for while this company is both the largest pork producer in the country and a well-run agribusiness in general, the combination of a low-margin business and a high-debt balance sheet makes this a never-boring play on protein.
First Quarter Results a Little Undercooked
Smithfield reported that sales rose a little less than 7% for the fiscal first quarter, with the total revenue figure coming in just a couple of percentage points below the average estimate. Sales performance was driven by the pork business (as it virtually always is), and pork revenue rose by 7.6%. Like Hormel (NYSE: HRL), Smithfield understands the virtues of a solid branded/packaged product business, and although packaged pork sales growth trailed the company average (6.4% versus 6.7%), it's still a significant contributor.
Fresh pork saw nearly 9% growth, though volume was down about 2%. Margins were at the high end of the company's historical range. On the packaged side, margins too were above normal levels and the company's sales growth was a byproduct of pricing (up 8%) offset by volume (down 1%).
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Friday, August 26, 2011
Investopedia: Hormel May Be More Organic Than You Think
There's a lot more to Hormel (NYSE:HRL) than Spam, but it takes a long time for common perceptions to change. Hormel is really not a commodity meat company like Tyson (NYSE:TSN) or Smithfield (NYSE:SFD); it has returns on capital much closer to branded packaged goods companies like Kellogg (NYSE:K) or Heinz (NYSE:HNZ). Hormel's processed foods may not be the epitome of healthy or organic eating, but if the company continues to develop popular brands and follow-on products, this could be a much more dynamic company than investors think.
Third Quarter Results on Target
Hormel did more or less as analysts expected it to do for this quarter. Sales rose 10% on flat volume, basically matching the average analyst guess. Sales growth matched that company-wide average in the refrigerated segment, while the grocery business lagged noticeably (up 4%) and Jennie-O and specialty slightly surpassed it.
Read more at the link below:
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Third Quarter Results on Target
Hormel did more or less as analysts expected it to do for this quarter. Sales rose 10% on flat volume, basically matching the average analyst guess. Sales growth matched that company-wide average in the refrigerated segment, while the grocery business lagged noticeably (up 4%) and Jennie-O and specialty slightly surpassed it.
Read more at the link below:
http://stocks.investopedia.
Thursday, August 11, 2011
Investopedia: Tyson Almost Ready To Serve
For the most part, the average investor should approach Tyson Foods (NYSE:TSN) with skepticism. It is the top player in America in its respective markets, but that has never translated into a sustained attractive margin structure or free cash flow record. On the other hand, savvy investors don't turn away from profit-making opportunities, and Tyson's stock may be very close to a point where there is real money to be made.
Familiar Themes Dominate the Third Quarter
Investors who have been following agribusiness are not going to see too many surprises in Tyson's fiscal third quarter results. Revenue was not too bad, as Tyson reported 11% sales growth on a combination of better-than 12% higher pricing and slightly worse than a 1% decline in volume. Sales growth was fairly balanced - all of the major categories had significant sales growth, with beef leading the way at 13.5% price increase. The relatively small prepared food business was the laggard at 9% growth.
Continue to the full piece below:
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Familiar Themes Dominate the Third Quarter
Investors who have been following agribusiness are not going to see too many surprises in Tyson's fiscal third quarter results. Revenue was not too bad, as Tyson reported 11% sales growth on a combination of better-than 12% higher pricing and slightly worse than a 1% decline in volume. Sales growth was fairly balanced - all of the major categories had significant sales growth, with beef leading the way at 13.5% price increase. The relatively small prepared food business was the laggard at 9% growth.
Continue to the full piece below:
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Friday, May 6, 2011
Investopedia: ConAgra And Ralcorp - If You Can't Beat Them...
Everybody knows the old expression, "If you can't beat 'em, join 'em". Apparently ConAgra (NYSE:CAG) is taking a different strategy - "if you can't beat 'em, quit and try something else". With ConAgra publicly making a bid for Ralcorp (NYSE:RAH), it would seem that this large Nebraskan packaged food company is content to cede the field to the likes of Kellogg (NYSE:K), Heinz (NYSE:HNZ), Kraft (NYSE:KFT) and General Mills (NYSE:GIS) in branded foods and focus much more closely on private label and value-oriented products.
The Deal That May Be
A deal between ConAgra and Ralcorp has been running through the rumor mill for a little while now, with Ralcorp recently mentioning that it had declined an unsolicited proposal while also preannouncing better-than-expected quarterly results. Clearly there was a not-so-subtle message here - namely, "we're improving quite well on our own, thanks".
Nevertheless, ConAgra has decided to go public with an offer of $86 per share in cash for Ralcorp. Not only does that represent a 32% premium to the pre-speculation price of Ralcorp, it also represents a sweetening of $4 per share from ConAgra's prior offer.
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The Deal That May Be
A deal between ConAgra and Ralcorp has been running through the rumor mill for a little while now, with Ralcorp recently mentioning that it had declined an unsolicited proposal while also preannouncing better-than-expected quarterly results. Clearly there was a not-so-subtle message here - namely, "we're improving quite well on our own, thanks".
Nevertheless, ConAgra has decided to go public with an offer of $86 per share in cash for Ralcorp. Not only does that represent a 32% premium to the pre-speculation price of Ralcorp, it also represents a sweetening of $4 per share from ConAgra's prior offer.
Please click here for the full piece:
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