What Annies Inc’s (BNNY) Needs: Healthier Growth

Now that industry giant Kraft Foods Group Inc (NASDAQ:KRFT) is focusing solely on its North American grocery business, it will likely hone in on the opportunity in the natural and organic segment, leveraging its brand awareness to drive sales of its own competing products. That won’t affect loyal Annie’s customers, but it might nevertheless slow the flow of new customers toward the company’s offerings.

In Annie’s quarterly report, watch for how the company’s operating margins compare to those of its competitors, both within the natural-foods niche and in the broader food-production industry. In order to make the most of its emerging brand, Annie’s should look for ways to boost margins. Especially as sales growth inevitably slows, it’ll be increasingly important for Annie’s to make the most of every dollar that comes in.

The article What Annie’s Needs: Healthier Growth originally appeared on Fool.com is written by Dan Caplinger.

Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter @DanCaplinger. The Motley Fool recommends and owns shares of Hain Celestial and Whole Foods Market.

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