Central Garden & Pet: 14% free cash flow yield with turnaround and takeout appeal.
With the stock market at all-time highs, if a company's stock is at or near 52-week lows, then chances are there are obvious problems with the company. Central Garden & Pet (CENT) is a case in point. CENT is a classic growth-by-acquisition consumer products company that has hit a wall and experienced substantial declines in operating margins. This decline is due to a combination of lack of attention to operating costs and "merger synergies" and an increase in commodity costs that the company has been unable to fully offset with price increases. Like all investments in turnaround stocks, investors have to be of the...
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