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  • Sysco Hits Our Upside Target, Retest Should Follow 2 comments
    Dec 9, 2013 1:35 PM | about stocks: SYY

    On September 26, 2013, we purchases a 19% position of Sysco Corporation (NYSE:SYY). Since that time, SYY has gone from near a 1-year low to a 1-year high all within three months. Today it was announced that Sysco Corporation would merge with U.S. Foods. The fair value target in our transaction alert on September 26, 2013 (found here) has been achieved but we expect that the stock will close below the fair value level on the day. Dow Theory suggests that SYY should re-test the fair value level at least once more.

    (click to enlarge)

    Our upside targets for SYY are substantial from a fundamental standpoint. However, we'd rather draw your attention to an article that we posted about companies in the industry and how Warren Buffett is utilizing similar companies as a hedge on the coming inflation. The article, titled "Warren Buffett Leverages Up on Inflation Hedge" (found here), outlines a longstanding thesis we have that if you believe inflation is coming then food processors, producers and distributors is the best way to take advantage of this trend going forward. We recommend considering related stocks once they hit our watch list as SYY at current prices are not as compelling as when we purchased the stock.

    Disclosure: I am long SYY.

    Stocks: SYY
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Comments (2)
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  • The_Hammer
    , contributor
    Comments (5027) | Send Message
    nice call was watching for a new low but it did not happen.
    9 Dec 2013, 02:42 PM Reply Like
  • New Low Observer
    , contributor
    Comments (2453) | Send Message
    Author’s reply » Greetings TH,


    Thanks for your continued commentary on our work it is really appreciated. Your on the right track when watching dividend increasing stocks at a new low. The one year performance of many down and out stocks from our prior lists suggests many opportunities still abound.


    Two stocks that were recently on our watch list are (LNN) & (VMI). Both stocks are in an industry that Warren Buffett specifically mentioned at the last shareholder meeting as mentioned in our BRK debrief (found here:


    Due diligence is worth your time on these two stocks.


    Again, thanks for your commentary.


    9 Dec 2013, 06:04 PM Reply Like
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