W) Is Best Foods a turkey
Rated a Watch
A flood of upgrades and a bullish chart got me digging.
Business
Bestfoods is among the largest U.S. consumer food companies with operations in more than 60 countries of North America, Europe, Latin America, Asia, the Middle East, and Africa and products sold in about 110 countries. The Company markets various leading food brands, and operates over 115 plants around the world through retail outlets and its foodservice business. The Company's products include Knorr soups, sauces, bouillons and related products; Hellman's and Best Foods dressings; Mazola corn and canola oils; Skippy peanut butter; Entenmann's sweet baked goods; Thomas' English muffins; Oroweat, Arnold, and Freihofer's breads; Mueller pasta products; Maizena corn starches; Boboli Italian pizza crusts; Alsa desserts; Pfanni potato products; and Pot Noodle instant hot snacks. Mayonnaise sales accounted for 12.6% of consolidated net sales in 1998. Bestfoods is also the largest fresh premium baker in the United States.
Analysts
08-May-00 10:00 -- 11:00 ET
Bestfoods (BFO) 63 1/4 -1/2: CSFB upgrades to BUY from HOLD. Analyst: D. Nelson says he believes the deal with Unilever (UL) will go through, probably at a higher price, perhaps $75.
03-May-00 10:00 -- 11:00 ET
Bestfoods (BFO) 61 13/16 +11 1/4: DLJ upgrades to BUY from MARKET PERFORM rating with a price target of $65; company rejected an unsolicited $18.4 bln all cash offer from Unilever (UN -3 7/16) late yesterday.
18-Feb-00 15:00 -- 16:00 ET
Bestfoods Inc. (BFO) 42 15/16 -15/16: Janney Montgomery Scott initiates coverage of consumer food company with a BUY rating and a 12-month price target of $55; expects FY00 and FY01 earnings growth of 11% and 13%, respectively.
News
10-May-00 05:47 ET
Bestfoods (BFO) 63 1/2: WSJI reports today that BFO is seeking to find a 'white knight' after Unilever NV's (UN: 43 7/8) unsolicited $18.4 bln bid. Bestfoods is also understood to be looking at a variety of options including potential acquisitions to prevent the takeover. Analysts contend Bestfoods is after an improved price
16-Mar-00 BEFORE THE OPEN
Procter & Gamble (PG) 58 1/2: Company to collaborate with Nestle USA, HJ Heinz (HNZ 33 7/8), Bestfoods (BFO 41 1/2) and Philip Morris Cos. (MO 20 1/8) as well as PricewaterhouseCoopers and the Grocery Manufacturers of America to create a global, industry-wide Internet marketplace according to the Wall Street Journal.
Briefing.com
05-May-00 08:41 ET
Bestfoods Inc. (BFO) 62 5/64: The deal is not done yet, but it seems that both sides in this possible friendly merger are willing to talk. Or at least it appears this way as last night Unilever NV (UN 43 3/16) decided to lift its deadline in its unsolicited pursuit of consumer food company Bestfoods. With Bestfoods having already rejected the unsolicited $66 per share offer made by Unilever earlier this week and calling it inadequate, UN had initially said that it wanted a formal response from the board of Bestfoods by Thursday evening. However, realizing that such a deadline would force them to act in a hostile manner in pursuit of the US-based consumer company, management at Unilever felt it was in their best interest to go after the soft-sell rather than the hostile route. Accordingly, the $66 per share offer is still on the table, but Unilever is seeking to sit down with the board of Bestfoods and talk about its offer. Obviously, Unilever realizes that the hostile route would prove to be much more expensive and more time consuming than doing a friendly deal. While the outcome is still very much in doubt, it seems that both sides are willing to talk and the likely outcome is that they will reach an agreement. Instead of $66 per share, expect the deal to be more in the range of $20 billion, or a bit more than $70 per share as already Bestfoods has said that the original bid was too low, suggesting that a higher bid is welcomed and would be considered. While in takeover cases, one always looks for a white knight, or certainly, a countering offer from a third party, at the price tag that Unilever and Bestfoods are talking about pretty much eliminates most bidders, including H.J. Heinz (HNZ 38 3/8), contrary to the report in USA Today. Possibly Philip Morris (MO 23 5/16) could still be interested at this lofty price or Swiss-based Nestle. However, given the posturing and concession that BFO and UN have made sofar, expect these two consumer food companies to walk down the aisle in the end. - Raul Nicho, Briefing.com
Posts of Note
BFO - Best Foods would be my #1 today, think it will be taken over. Only question is by whom and at what price. If not taken over, will have to recapitalize and do huge buy back or special dividend. the stock is in play, my experience of stocks in play is that they get taken out, usually at a price higher than anyone expects initially.
5/9/00
Message 13591154
The 18.4 b offer was rejected by the board.(cnbc)eom.
5/2/00
ragingbull.com
Numbers
52-Week Low on 7-Mar-2000 $35.75
Recent Price $64.75
52-Week High on 11-May-2000 $66.188
Market Capitalization $17.8B
Shares Outstanding 274.5M
Float 271.8M
Annual Dividend (indicated) $1.06
Dividend Yield 1.64%
Price/Book (mrq) 28.12
Price/Earnings (ttm) 25.45
Price/Sales (ttm) 2.14
Rev 2,187.0M to 2,155.0M to 2,064.0M to 2,223.0M to 2,218.0M Mar00
EPS 0.49 to 0.61 to 0.64 to 0.74 to 0.56 Mar00 Briefing.com
Chart
Bullish 10/50/200 stack. Gapped from $50 to $60 on May 3, 2000 which is a bullish sign. MACD positive since March 15.
Biggest days in three months were last week and all green.
Summary
I like Entremann, but the rest of the line is a pass. Company is flat for growth and without the deal, no one would bother. Purely momentum on a Mayonnaise company.
Jack |
