ing_rivera

Sanderson Farms: Modest Upside, Possible Short Squeeze

Low debt, focus and great management (specially the CFO which started in 1998 and has turned things around dramatically) in a very fragmented industry, gives Sanderson a competitive advantage which have allowed them to perform better than its peers in the last couple of years, returning around 5% better on equity. Their fair value is $40, I'll buy for $24 at 0.6 their value to assure a 50% year over year return.

The author was right on his 42 number but at the end he said 55 which is too much and was based on increased market share and increase per capita consumption....well first Tyson is a great competitor and won't allow those share gains so easily, second people won't eat more chicken, beef, pizza or whatever next year...well at least I won't do you? Food habits are pretty stable.