Stephen Simpson, CFA
Long only, growth at reasonable price, value, research analyst

For Pinnacle Foods, Slowly Does It

If you're looking for a dynamic revenue growth story, you probably want to look somewhere other than at Pinnacle Foods (NYSE:PF). Pinnacle's management is realistic, looking for growth in line with the industry categories and focusing instead on optimizing cost and operating leverage. With several other brands and food businesses likely up for sale and opportunities for additional gross margin improvements, Pinnacle Foods still offers some respectable upside for patient investors.

Cost-Focused In A Promotion-Heavy World

One of the first things that jumps out about Pinnacle Foods is the exceptionally low operating expense structure for the company. Overall core SG&A (stripping advertising out of marketing and selling expenses) is in the neighborhood of 9% to 10%, far below...

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