J.M. Smuckers…Trying To Buck The Trend

For those who follow me, know I have been a

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on Consumer Staples for the last 12 months.  Due to inflation, interest rates, raw material input cost and Millennials preferring other alternatives, these companies in this sector don’t make money.  However, one company trying to buck the trend in the Consumer Staples sector is J.M. Smucker Company.

The J.M. Smucker Company is a packaged food maker and manufacturer of fruit spreads, retail packaged coffee, peanut butter, shortening and oils, ice cream toppings, sweetened condensed milk, and natural foods products in North America and has been around for more than 115 years.

J.M. Smucker Co announced earnings a couple of weeks ago and beat analysts’ estimates for quarterly sales and profit due to higher demand for its Dunkin’ Donuts-branded coffees and its purchase of premium pet foods maker Ainsworth.  One the news the stock rose $4.

You see, back in 2015, Smucker Company and Keurig Green Mountain, Inc. (Keurig) (NASDAQ: GMCR) expanded their partnership by signing agreements for the manufacturing, marketing, distribution and sale of Dunkin’ K-Cup® packs at retailers nationwide in the U.S. and Canada, and online. 

With more than 18,000 distribution points in nearly 60 countries worldwide, Dunkin’ Brands Group, Inc. (Nasdaq: DNKN) is one of the world’s leading quick service restaurants (QSR) serving hot and cold coffee and baked goods.

In addition, in 2015, Smucker Company acquired Milk Bone-owner Big Heart Pet Brands for $5.8 billion and last year bought Ainsworth Pet Nutrition for $1.9 billion last year.  As a result, Smucker’s U.S. retail pet foods business, the company’s biggest, saw a 35 percent rise in sales in the third quarter.

In business, sometime you need a little luck and sometimes you have to have the right vision and execute.  I would stay Smucker Company to this point has been a forward thinking company.  But because they operate in the consumer staples sector and because 80% of a stock’s move is tied to the index and sector (they are in), I think there are better opportunities out there for investors to put their hard earn money.

This the chart suggests that price will fall further to the monthly demand at $8.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

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