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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Elroy who wrote (61755)	2/26/2019 9:06:55 AM
From: E_K_S	Read Replies (3) \| Respond to of 78701

Re: BGS Check out their FCF over last few quarters. It's quite good. CEO was paying down debt (I think $250mln) and even buying back shares while paying their dividend. There was some concern that to help their product portfolio they may make a large acquisition which would put them back into their high debt profile again. Now w/ this sale to Hershey will that impact their FCF to the downside significantly? Not sure, but I suspect that was figured into the total picture. 2019/2020 EPS may get reduced as a result, so that is why GN valuation at around $25.50/share is now fair value. Market is still trying to figure out if that dividend is sustainable long term. I say based on the other food stocks in the sector, EPS could be strained. Look at SJM. They have one of the lowest debt profiles and many high margin products (like their spice division). SJM has sold off w/ the rest of them. It's all about the future EPS, so hard to know but based on some large PUT Options traded yesterday, there is at least one investor betting this stock goes much lower. I am betting on their FCF numbers numbers, reversion to the mean and some lower adjustment based on their product portfolio composition. I have been wrong and there are many other analysts/investors w/ more information and much smarter than me, so buyer beware. EKS