Consumer Stocks Poised to Rise as Economy Improves: The Clorox Company (CLX), Dean Foods Co (DF), Diamond Foods, Inc. (DMND)

Page 1 of 2

A multitude of positive news on the economic activity front has led to a strong rally in consumer stocks.

First off, fewer than expected Americans filed applications for unemployment benefits last week, indicating that companies are cutting fewer workers and may be willing to hire more.

Unemployment benefit claims fell 22,000 last week, according to data released by the Labor Department. This is no flash in the pan as the four-week moving average –thought to be a better indicator than a single week’s data– also dropped by 6,750 to 355,000. In fact, the drop is part of a longer declining trend which has seen jobless claims falling almost 11 percent since November. After adding 157,000 jobs in January, the job market is looking much better than three months ago.

The Clorox Co (NYSE:CLX)After taking several hits in recent months due to the fiscal cliff issues, debt ceiling crisis, and expiration of the payroll tax cut, U.S. consumer confidence also edged up in February.  According to data released by the Conference Board, the U.S. Consumer Confidence Index increased 11.2 points in February to 69.6, marking the first increase since October.

The rally in consumer confidence was broad-based, with almost every major subindex increasing. Some more positivity flowed in the market after the Commerce Department’s revised figures revealed that the economy expanded, although marginally, in the fourth quarter. Even though the growth at 0.1 percent was not very high, it was a reversal from initial reports of a contraction.

While these upbeat performances are likely to have a positive impact on the entire economy, consumer stocks are the ones which stand to gain the most and quickly.

Consumer stocks such as Diamond Foods, Inc. (NASDAQ:DMND), Dean Foods Co (NYSE:DF), and The Clorox Company (NYSE:CLX) have already started moving up, taking cues from what is happening to general economy.

San Francisco-based branded packaged food company Diamond Foods is one such stock which has been moving up lately. Up nearly 6 percent in the last month, Diamond Foods, Inc. (NASDAQ:DMND)’s undervalued position attracted investment firm BlackRock which disclosed recently that it picked up a 7.85 percent stake in the company.

With a market capitalization of just $336.57 million and stung by improper accounting practices in the past, the company does not quite make it to institutional buyers’ lists. However, the latest development seem to have vaulted the stock in a new orbit altogether.

Similarly, value has emerged in Dallas based Dean Foods Co (NYSE:DF) which lost in double digits a couple of weeks back after giving a below-expectation profit forecast for the next quarter. Dean Food’s report card for the latest quarter was pretty good, with the company swinging to a profit of $37 million against a loss of $9.9 million in the same period last year.

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

The 10 Richest Stand Up Comedians in the World

The 10 Fattest Countries in the World

The 5 Best Summer Jobs for Teens

The 10 Most Religious Countries in the World Keeping the Faith

The 10 Most Educated Countries in the World

The 10 Most Popular Cell Phones in the World

The 10 Drunkest Countries in the World

The 10 Most Expensive Private Schools in the World

The 10 Smallest Countries in the World

Walking Dead Season 5 Spoilers You’ll Wish You Didn’t Know

The 10 Poorest Countries in the World

The 10 Greenest Countries in the World

The Top 10 Countries with the Highest Population in the World

The 10 Most Visited Countries in the World

The Top 10 Star Wars Characters in the Iconic Series

The 10 Most Expensive Android Phones in the World

5 Reasons Why The Illuminati Is Real and a Threat to Society

The 6 Scariest Halloween Costumes Ever Screamed At

The 4 Biggest Hedge Fund Managers in the World Today

The 15 Most Densely Populated Countries in the World

The 10 Biggest Tea Drinking Countries in the World

Top 6 Ways to Improve Your Checkout Process and Close Sales

The 5 Most Profitable Online Businesses You Can Start Today

The 20 Most Profitable Hospitals in the US

The 5 Most Profitable Home Businesses to Start

The 7 Teams that Will Win the Stanley Cup in 2015

The Top 10 Most Expensive Digital Cameras to Snap Stunning Shots With

The 10 Highest Quality Fast Food Restaurants In America Today

The 8 Best Halloween Decorating Ideas to Spook Up Your House

10 Marvel Women that Should Get a Movie Right Now

The 20 Best Remixes of Popular Songs that Will Make You Forget the Originals

7 Most Expensive Cities in the World

5 Least Expensive Cities in the World

10 Celebrities Who Believe In Scientology

10 High Margin Food Products to Build a Business Around

The 10 Most Expensive Clothing Stores in the United States to Get Decked Out At

The 5 Biggest Kickstarter Scams That Swindled Backers’ Donations

The 10 Most Expensive Boarding Schools In the World

50 Crazy Facts About Japan You Won’t Believe

Top 10 Least Expensive Hybrid Cars to Save the Planet With

The 10 Biggest ‘Gate’ Controversies in History

The 10 States with the Highest Nursing Shortages Leaving Their Hospitals Depleted

The 10 Best Value Investment Blogs that Every Investor Must Read

The 6 Cheapest Boarding Schools in Europe 2015

The 5 Most Expensive Cars To Insure in the World

The 10 Most Common Genetically Modified Foods

10 Self-Made Billionaires Who Came From Nothing

The 10 Most Expensive Cities to Live in North America

The 13 Most Expensive Headphones in the World to Represent

The Top 20 Wealthiest Soccer Teams in 2014

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!