Shares of Illinois-based food manufacturer
TreeHouse Foods, Inc.
) reached a new 52-week high of $68.82 on Jul 3 following its
acquisition of Cains Foods - a maker of mayonnaise, dressings and
sauces. The share price of the stock has been on the rise since
the acquisition on Jun 24, gaining 4.3% in just 11 days.
Shares of this Zacks Rank # 2 (Buy) stock closed at $68.66 on
Jul 3, recording a healthy return of 28% on a year-to-date basis.
The company's long-term estimated EPS growth rate is 10.13%.
Average volume of shares traded over the last three months came
in at approximately 116K.
Acquisition of Cains Foods
TreeHouse completed the acquisition of privately-owned Cains
Foods for $35 million. The deal was announced on Jun 24, 2013 and
is expected to boost TreeHouse's earnings by 5 cents per share in
2014. There will be no major impact on 2013 earnings.
Massachusetts-based Cains sells its products through private
label store brands as well as under the Cains, Naturally
Delicious and Olde Cape Cod brands. The company supplies to
leading food service distributors, national chains and retailers.
The deal is thus a strategic fit for TreeHouse, which primarily
serves the retail grocery and foodservice channels. Cains'
popular brands will also enhance TreeHouse's product portfolio,
which includes pickles and related products; non-dairy powdered
coffee creamer; and other food products including aseptic sauces,
refrigerated salad dressings and liquid non-dairy creamer.
The company is keen on expanding its portfolio through
acquisitions. It has appointed Harry J. Walsh as the new
Executive Vice President for its Acquisitions and Integration
unit, which will help the company to expand into new categories
Some recent acquisitions by TreeHouse include - the aseptic
cheese and pudding business from Minnesota-based dairy marketing
cooperative Associated Milk Producers Inc. in Nov 2012 and
Atlanta-based food company, Naturally Fresh, Inc., in the second
quarter of 2012. These acquisitions played an important role in
pulling up the company's revenues in the first quarter of 2013,
results of which were announced in May this year.
Other Stocks to Consider
Other stocks in the food business that are currently doing
well and are worth considering include
Flower Foods Inc.
Omega Protein Corp.
B&G Foods Inc.
), all carrying a Zacks Rank #1 (Strong Buy).
B&G FOODS CL-A (BGS): Free Stock Analysis
FLOWERS FOODS (FLO): Free Stock Analysis
OMEGA PROTEIN (OME): Free Stock Analysis
TREEHOUSE FOODS (THS): Free Stock Analysis
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