Even though the market is in a correction,B&G Foods (
) is showing relative strength.
The stock has rallied in the past three weeks, scoring gains
in heavy volume. So far this week, it's tacking on more
The stock hit a record high Monday after staging an upside
reversal. It notched another all-time high in Tuesday's
B&G Foods cleared a 33.24 buy point in a four-month
consolidation June 18 in soft turnover. But big volume came in
three sessions later.
Gains in high volume are signs of professional buying. At the
end of the first quarter, 268 mutual funds owned shares, up from
252 funds at the end of the third quarter of 2012.
The Parsippany, N.J.-based company makes a barrage of food
items such as Cream of Wheat, Mrs. Dash, Molly McButter and the
Ortega line of Mexican food products. Although earnings fell 21%
in 2008, they have grown by double digits each year since.
Analysts polled by Thomson Reuters see profit rising 16% to $1.56
Buyouts have been key to B&G's growth. Earlier this year,
the company agreed to buy Pirate Brands for about $195 million in
cash. Pirate's Brands makes Pirate's Booty and Smart Puffs
snacks. Last year, B&G Foods acquired New York Style and Old
London brands from from Chipita America for around $62.5
Besides delivering growth, B&G Foods also doles out a
healthy dividend. The firm currently pays 29 cents a share
quarterly. B&G last raised its dividend by 7% to the current
rate of 29 cents in October.
On an annual basis, B&G Foods pays $1.16 a share to
shareholders, which works out to a yield of about 3.4%. B&G
Foods has the third-highest yield among the 17 dividend-paying
stocks in the Foods-Packaged group.