Hillshire Brands in focus following strategic acquisition

|About: Hillshire Brands Co. (HSH)|By:, SA News Editor

Shares of Hillshire Brands (HSH) are higher in premarket trading with more analysts backing the company's move to buy Pinnacle Foods (PF) as a strategic long-term play.

Some investors sold off Hillshire yesterday after the company removed its "pure-play" label through its acquisition of Pinnacle and with some speculation a ratings agency downgrade could be down the road.

During a conference call with analysts, Hillshire execs said the deal will deliver "enhanced scale, capabilities, and margins, along with input cost diversification."

Morningstar agrees, noting product diversity and scale could help smooth out margin fluctuations.

Hillshire conference call transcript

HSH +1.9% premarket