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Strategies & Market Trends : Value Investing
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To: Paul Senior who wrote (61489)11/30/2018 3:35:28 PM
From: E_K_S  Read Replies (1) of 78715
 
RE: UNFI (forward PE=8.64)

Been watching this one too but have already been down this road when SuperValue bought Albertsons. Made money but took a long time, hedged w/ ABS bonds (which were paid off at PAR).

My lesson was to focus on those food companies that supply higher margin products to these supermarkets but pay a value/bargain price. I now own BGS & DF and even these food suppliers have their warts too.

FWIW, Am looking to add more DF at/below $5/share (maybe a bit more tax loss selling next few days/weeks) as they are now selling at 80% of BV (BV=$6.25/share). Company just cut their dividend which now yields 2.5%.

DF has been investing in their processing facilities updating all their equipment w/ state-of-the-art milk processing equipment from Sweden/Norway. They produce milk, butter ice cream and have recently diversified into no dairy drink (think soy milk).

Maybe the best approach is just owning a basket of all these food stocks including the supermarkets. Wish I could buy Trader's Joes but that is a private company. Seems like I spend more there than other markets almost as much as my Costco runs.

Also had my eye on WallMart but no buys yet (PE=20 so no bargain). I recently completed an online order and got some jeans at a better price than AMZN but free delivery took 10 days. When I visited our local neighborhood Wallmart store, a guy was coming out w/ new tires. It seems many people use their local stores as drop off/pick up locations.

Good luck w/ UNFI as their forward PE is at a value/bargain price of 8x.

EKS
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