Hain Celestial: Organic Gold

| About: The Hain (HAIN)

Right now, it seems like everywhere I turn, I see an increase in organic and natural food and products offerings. People in this country and abroad are more and more conscious of what they are consuming, both for the sake of the planet and for their own health reasons. A recent New York Times article pointed out how it also has become fashionable to buy organic. This is great news for companies that have long been players in the organic and natural foods market.

One of these is Hain Celestial Group, Inc. (NASDAQ:HAIN), based in Melville, NY. This leader in the natural and organic food and personal care products industry has a strong presence in North America and Europe, and is pushing into Asia.

Anyone who shops in health food stores -- or even in mainstream supermarkets -- has likely seen a HAIN brand. They include Celestial Seasonings®, Terra Chips®, Health Valley®, Earth's Best®, Arrowhead Mills®, FreeBird™, Hain Pure Foods®, Rice Dream®, Soy Dream®, Queen Helene®, Batherapy® and Footherapy®, and the recently acquired Avalon Organics® among many other brands. Hain Celestial provides specifications to independent food processors to produce the various brands.

While in June, HAIN acknowledged that the Securities and Exchange Commission had opened an "informal inquiry" into its stock option practices, the company also has said it will cooperate with the agency, and I don't think that this will turn into a scandal that will cause any lasting damage. The company continues smart growth through acquisitions, most recently acquiring WhiteWave Foods Company, a subsidiary of Dean Foods Company (NYSE:DF), whose tofu and meat-alternative business fills out HAIN's alternative meat offerings. In Asia, it is breaking into the market with a planned expansion of the Singapore-based food and beverage company, Yeo Hiap Seng Limited.

In May, HAIN announced record third quarter earnings, with net sales up 21%, net income up 37%, and earnings per share up 30% over the prior year third quarter. Says its President and CEO, Irwin D. Simon, "The successful execution of our strategy continues to accelerate our sales, margin and earnings growth from our broad portfolio of natural and organic brands in North America and Europe, including the United Kingdom." Given the increased craze for organic and all-natural, and the continued growth of the company, I don't think we're going to see Hains Celestial slow anytime soon.

Type of stock: A leading organic and natural food and personal care products manufacturer that continues to grow through brand acquisitions.

Price target: Currently at $27.21, I feel this solid company will ride the ongoing craze for all things organic and might surpass its 52-week high of $31.93 by the end of the year -- it has the potential to reach $35 by year's end.

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Tagged: , Processed & Packaged Goods
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