While ModernGraham supports the bottom-up approach to investing, many investors do utilize the top-down method, whereby an industry is selected before the company itself. With that in mind, this article will take a brief look at the best companies of the food processing industry, selecting the most promising investment opportunities within the industry, and giving a broad look into the industry as a whole.
Out of the more than 530 companies reviewed by ModernGraham, 19 were identified as being closely related to the food processing industry. Of those, only one is suitable for the Defensive Investor, six are suitable for the Enterprising Investor, and the remaining twelve are considered speculative at this time. The average company was rated as being priced at 235.71% to its MG Value (estimated intrinsic value), with an average PEmg ratio of 28.42. The industry as a whole, therefore would appear to be overvalued, particularly in comparison to the market (see Mr. Market's Mental State).
Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
Additional disclosure: See a list of my current holdings on ModernGraham.com. This article is not investment advice; any reader should speak to a registered investment adviser prior to making any investment decisions. ModernGraham is not affiliated with the company in any manner. Please be sure to review our detailed disclaimer on ModernGraham.com.