Thu, Apr. 16, 5:17 PM
Mon, Apr. 13, 1:06 PM
- Wal-Mart's (WMT) strategy to increasing pricing pressure on suppliers is likely to be felt by some consumer products giants.
- Though larger suppliers have more leverage with Wal-Mart than smaller companies, an impact on margins could still be felt.
- Listed below are the estimated annual revenue and percentage of total revenue derived from the Bentonville retail giant for some CPG firms.
- Procter & Gamble (NYSE:PG): $12B to mark 14% of total revenue.
- PepsiCo (NYSE:PEP): $8B, 12% of total revenue.
- Kraft Foods (NASDAQ:KRFT): $4.7B, 26% of total revenue.
- Kellogg (NYSE:K): $3.1B, 21% of total revenue.
- Campbell Soup (NYSE:CPB): $1.6B, 19% of total revenue.
- J.M. Smucker (NYSE:SJM): $2.35B, 30% of total revenue.
- Clorox (NYSE:CLX): $1.5B, 26% of total revenue.
- Hillshire Brands (NYSE:TSN): $1.1B, 27% of total revenue.
- Keurig Green Mountain (NASDAQ:GMCR): $799M, 17% of total revenue.
- Energizer (NYSE:ENR): $748M, 17.2% of total revenue.
- Tootsie Roll (NYSE:TR): $129M. 23.7% of total revenue.
- Data compiled by the Cincinnati Enquirer
Thu, Mar. 26, 12:37 PM
- Deutsche Bank thinks 3G Capital will be back in the food sector for a major acquisition faster than some other investment firms anticipate.
- 3G put itself in a stronger position to make a major purchase by not adding debt in the Kraft deal.
- Analyst Eric Katzman sees some food names trading with a premium as the 3G shadow hangs over the sector, while others have downside risk with M&A speculation not making as much sense.
- Premium on: ConAgra (NYSE:CAG), General Mills (NYSE:GIS), Mondelez International (NASDAQ:MDLZ), Pinnacle Foods (NYSE:PF), PepsiCo (NYSE:PEP).
- Premium off: Campbell Soup (NYSE:CPB), Hershey (NYSE:HSY), Hormel (NYSE:HRL), Kellogg (NYSE:K), J.M. Smucker (NYSE:SJM).
- Previously: Investors snapping up food stocks (Mar. 25 2015)
- Previously: Beer fallout from Kraft buyout (Mar. 25 2015)
- Previously: Kraft-Heinz merger has a few ETFs on the move (Mar. 25 2015)
Mon, Mar. 9, 7:37 AM
- Wheat prices took a sharp turn lower last week as traders weighed the large amount of global supply versus a tightening of demand in the U.S.
- Prices have recovered a bit today in front of a Department of Agriculture report, but are expected to see more downward pressure.
- The development should bring some relief for food companies as supplying contracts are reworked.
- Related stocks: SJM, FLO, CAG, POST, CPB, GIS, K, PEP, BUD.
- Related ETF: WEAT.
- Wheat daily price wheat chart.
Mon, Mar. 2, 2:34 PM
- Coffee prices are in retreat as extended rain in Brazil and increased production capacity has helped to soothe the market and push up forecasts on output.
- Data from the U.S. Commodity Futures Trading Commission indicates a sharp drop in bullish bets on coffee as experts now ease off some previous concerns on supply vs. demand.
- Arabica prices are still higher than where they were a year ago.
- There could be a lag factor for many companies to see a benefit from lower coffee commodity costs. Starbucks tipped off during its FQ1 earnings call (transcript) it has 94% of its 2015 coffee needs already priced.
- Arabica coffee price chart
- Related stocks: GMCR, SBUX, JVA, SJM, KRFT, DNKN
- Related ETFs: JO
Thu, Feb. 26, 10:42 AM
- Shares of J.M. Smucker (SJM +1%) and Dunkin Brands' (DNKN +2.9%) are both higher after the two companies sign a deal to broaden distribution for Dunkin' Donuts K-cups.
- J.M. Smucker is handling distribution to grocery stores and club chains, while Keurig Green Mountain (GMCR -0.1%) will cover office supply stores and specialty stores.
- Perhaps the most important aspect of the new distribution deal is that Dunkin' K-Cup packs will now be sold online.
- The K-cup shakeup isn't expected by most analysts to have a major impact on Starbucks (SBUX +0.2%) which is also a Keurig partner. Smaller coffee brands could suffer though.
Thu, Feb. 26, 6:48 AM
- Dunkin' Brands (NASDAQ:DNKN) and J.M. Smucker (NYSE:SJM) expand a partnership with Keurig Green Mountain (NASDAQ:GMCR) for the distribution of Dunkin' K-Cup packet to include retailers and grocery store chains nationwide in the U.S. and Canada.
- The current deal between the companies only includes Dunkin' restaurants in the U.S.
- The development should have positive implications for Keurig Green Mountain (GMCR).
- Financial terms of the arrangement weren't disclosed.
Wed, Feb. 18, 4:02 PM
- The International Coffee Organization expects global coffee demand to rise 25% by 2021.
- Expectations for rising demand in China, India, and Latin America is partially behind the strong forecast.
- The coffee market is under pressure currently from tight supply due to crop difficulties in Brazil.
- A sharp drop in the real has counterbalanced the supply shortage to a degree.
- Related stocks: GMCR, SBUX, JVA, SJM, KRFT, DNKN
- Related ETFs: JO
Sat, Feb. 14, 10:13 AM
- Craft soda is starting to become a trend to watch closely, according to industry insiders.
- Though still accounting for only ~1% of the total U.S. soda market, major retail chains have increasingly been willing to bet on local craft brands in store aisles.
- The craft craze is old news for the beer industry where coming-of-age millennials buy craft/local beers at a 50% higher rate than brand-loyal older generations. Fading stars such as Budweiser and Bud Light are testament to the impact of the millennial paradigm.
- The craft influence in coffee hasn't been lost on Starbucks which has strategically deployed trucks on college campuses in an effort to win over students.
- Despite the progressive reputation of Starbucks, analysts think new upstarts such as Craft (subscription) and Cups (app) have a shot of gaining influence with the Indie-minded millennial crowd on "customization" and pricing.
- What to watch: An increase in M&A activity in the beverage sector is expected as major companies strategically pick off more local craft brands to incubate.
- Craft beer watch: BUD, OTCPK:SBMRY, TAP, OTCQX:HEINY, SAM, BREW, STZ, OTC:BIBLF, OTCPK:BRBMF.
- Craft coffee watch: GMCR, SBUX, JVA, SJM, KRFT, DNKN, QSR, MCD.
- Craft soda watch: PEP, KO, MNST, COT, DPS, OTCQB:JSDA, REED, SODA, FIZZ.
Fri, Feb. 13, 7:54 AM
- J.M. Smucker (NYSE:SJM) warns on continued pressure on its U.S. retail coffee business.
- The company saw a volume decline in Folgers coffee offset gains it made during the quarter with Jif peanut butter, Crisco oils, and fruit spreads in FQ3.
- Revenue growth by segment: U.S. Retail Coffee -1% to $571.8M, U.S. Retail Consumer Foods -2% to $549.5M, International/Foodservice/Natural -3% to $318.7M.
- Price realization added a point of growth during the quarter.
- Gross margin -90 bps to 36.3% as commodity price increase weren't recaptured by price hikes.
- Marketing costs rate -120 bps to 4.2%.
- Operating income rate -30 bps to 17.7%.
- SJM unchanged in early trading.
Fri, Feb. 13, 7:05 AM
Thu, Feb. 12, 5:30 PM
Mon, Feb. 9, 6:43 PM
- J.M. Smucker (NYSE:SJM) COO Vincent Byrd has been named vice chairman. In his new role, Byrd, along with Big Heart Pet Brands CEO David West, will "lead the integration and synergy efforts of the Big Heart Pet Brands transaction." Timothy Smucker remains chairman.
- Mark T. Smucker, formerly the president of U.S. retail coffee, will now be president of Consumer and Natural Foods. Steven Oakland will be president, Coffee and Foodservice, and Barry Dunaway president, International and chief administrative officer. They'll all report to CEO Richard Smucker.
Wed, Feb. 4, 12:03 PM
- FreshPet (FRPT +1.6%) and PetSmart (PETM +0.1%) trade higher following J.M. Smucker's (SJM +5.3%) entry into the pet food business through an acquisition of Big Heart Pet Brands.
- The product category has shown stronger demand from consumers than anticipated by analysts.
- PetSmart etched out an all-time high today of $82.53 - just off its buyout price of $83.
- Though FreshPet is off its IPO highs, the stock trades at a much higher sales multiple than what J.M. Smucker shelled out last night.
Wed, Feb. 4, 9:13 AM
Tue, Feb. 3, 4:57 PM
- J.M. Smucker (NYSE:SJM) is acquiring Big Heart Pet Brands from its P-E owners for 17.9M shares, $1.3B in cash, and $2.6B in debt that will be refinanced (total consideration of $5.8B). For reference, Smucker closed today with a $10.7B market cap.
- Big Heart, known as Del Monte before unloading its consumer products ops, owns the Meow Mix, Kibbles 'n Bits, Milk-Bone, and Natural Balance pet food brands, among others.
- The deal is expected to close by the end of Big Heart's FY15 (ends on May 3). Following its closing Big Heart CEO Dave West will serve as the the president of Smucker's pet food ops.
- Smucker has risen to $110.75 in AH trading, making new 52-week highs along the way.
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