Hormel Foods Corporation (HRL): Should You Lose Your Appetite For This Food Stock?

Page 1 of 2

Companies that make and sell products we all use on a regular basis have been some of the best performing stocks to hold over long periods of time. Their stable businesses mean consumers buy their products regardless of the economic climate.

In addition, that financial stability is often accompanied by steady dividend payments, year in and year out. Over many decades, those dividends add up to huge returns for shareholders. One such company that exhibits all these qualities is Hormel Foods Corporation (NYSE:HRL), which, until recently, was on a nearly uninterrupted rally.

Hormel Foods Corporation (NYSE:HRL)

On June 18, Hormel cut its fiscal 2013 profit outlook, sending shares down more than 3% on a day in which the Dow rose nearly 140 points. Should investors put this food stock back on the shelf? Or is there still reason to add Hormel to your shopping cart?

Hormel: A long and proud history

Hormel Foods Corporation (NYSE:HRL) is a company that likely flies under the radar of many investors. That’s because in the packaged food space, it’s a smaller competitor to industry giants like Kraft Foods Group Inc (NASDAQ:KRFT) and ConAgra Foods, Inc. (NYSE:CAG).

That being said, Hormel is a company with a long history of satisfying its hungry customers and shareholders alike.

Hormel was founded in 1891, and has since sold its flagship Spam and Hormel Chili to consumers. However, the company has broadened its product portfolio over the years. The company holds the Jennie-O brand, and earlier this month announced the acquisition of the Skippy peanut butter line.

Moreover, Hormel Foods Corporation (NYSE:HRL) has an enviable dividend track record: the company has provided investors an astounding 47 consecutive years of dividend increases.

The grocery aisles are packed with competitors

ConAgra has a market value of $14 billion and many household brands, including Healthy Choice, Hebrew National, and Del Monte. ConAgra’s consumer brands can be found in 97% of America’s households, and 28 of them are ranked first or second in their category.

ConAgra has executed strongly for many years, and its shareholders have benefited handsomely. The company was founded all the way back in 1919 and has demonstrated a clear intention of rewarding shareholders. Last year, the company raised its dividend by 4% and yields nearly 3% at recent prices. Moreover, ConAgra realized 8% sales growth in 2012.

Kraft, meanwhile, almost needs no introduction. The $33 billion packaged food giant holds a stable of brands that can be found in virtually every household in America. Some of these include Miracle Whip, Jell-O, Oscar Mayer, Planters, and Velveeta.

Page 1 of 2
Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The 10 Largest Pharmaceutical Companies In the World

The 10 Most Expensive Android Apps

The 9 Most Expensive Designer Bags in the World

The 7 Most Expensive Real Estate in the World

The 10 Most Expensive eBay Items Ever Sold

The 10 Most Expensive iPhone Apps

The 9 Most Expensive Designer Shoes in the World

The 10 Most Expensive Cigarette Brands

The 10 Most Expensive Law Schools in the US

The 10 Best Wall Street Movies

The 10 Most Expensive Golf Clubs Ever Sold

The 10 Most Expensive Golf Memberships

The 10 Best Disney Characters Ever Created

The 8 Best Foods for Gaining Weight

The 10 Most Expensive Colleges in the World

The 7 Most Memorable Ad Campaigns of All Time

The 7 Most Expensive High Schools in the World

The 10 Electric Vehicles with the Longest Range

The 10 Cities with the Worst Drivers in the World

The 10 Most Expensive Dresses Ever Created

10 Islands to Visit Before You Die

10 Famous Celebrities Who Needed Rehab

The 15 Countries with the Largest Oil Reserves

The 10 Most Overused Excuses in the World

The 5 Best iOS Apps You Can’t Get on Android

5 Companies Damaged By Social Media Blunders

The 10 Most Legendary Blues Songs

The 10 Most Lawless Places in the World

4 Reasons China is a Threat to the US

The 17 Most Sugary Drinks in the World

The 10 Most Ruthless Rulers in History

The 10 Greatest Generals in History

Top 8 Travel Destinations for 2015

The 10 Safest Dog Breeds for Children

The 10 Most Stolen Vehicles in the US

The 7 Most Expensive Celebrity Weddings

The 10 Best LoL Teams in the World

Top 10 Worst Marketing Campaigns Ever Produced

Top 5 Diets that Help You Lose Weight

The 10 Best Ways to Stay Awake

7 Artists That Switched Musical Genres

The 10 Most Expensive Cities to Live in New Jersey

The 10 Best High Schools in New York

The 10 Countries With the Least Gender Inequality

The 6 Biggest Musician-Manager Feuds

The 10 Countries with the Cheapest Gas Prices

The 7 Most Theatrical Bands of All Time

The 8 Worst Band Breakups of All Time

The 10 Most Important South American Leaders

The 7 Most Successful Casting Show Winners

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!