The following are the top rated Consumer Staples stocks according to Validea's Contrarian Investor model based on the published strategy of David Dreman. This contrarian strategy finds the most unpopular mid- and large-cap stocks in the market and looks for improving fundamentals.
KRAFT HEINZ CO (KHC) is a large-cap stock in the Food Processing industry. The rating according to our strategy based on David Dreman is 76% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: The Kraft Heinz Company manufactures and markets food and beverage products around the world through its eight consumer-driven product platforms: Taste Elevation, Easy Ready Meals, Substantial Snacking, Desserts, Hydration, Cheese, Coffee, and Meats. The Company has two reportable segments defined by geographic region: North America and International Developed Markets. Its other segments, consisting of West and East Emerging Markets (WEEM) and Asia Emerging Markets (AEM), are combined and disclosed as Emerging Markets. It manufactures its products from a wide variety of raw materials. Its brands include Kraft, Oscar Mayer, Heinz, Philadelphia, Lunchables, Velveeta, Ore-Ida, Capri Sun, Maxwell Apartment, Kool-Aid, Jell-O, Heinz, Golden Circle, Watties, Plasmon, Heinz, ABC, Master, Quero, Kraft, and Pudliszki, among others. The Companys products are sold through its own sales organizations and through independent brokers, agents, and distributors.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
| MARKET CAP: | PASS |
| EARNINGS TREND: | PASS |
| EPS GROWTH RATE IN THE IMMEDIATE PAST AND FUTURE: | FAIL |
| P/E RATIO: | FAIL |
| PRICE/CASH FLOW (P/CF) RATIO: | FAIL |
| PRICE/BOOK (P/B) VALUE: | PASS |
| PRICE/DIVIDEND (P/D) RATIO: | PASS |
| CURRENT RATIO: | PASS |
| PAYOUT RATIO: | PASS |
| RETURN ON EQUITY: | FAIL |
| PRE-TAX PROFIT MARGINS: | FAIL |
| YIELD: | PASS |
| LOOK AT THE TOTAL DEBT/EQUITY: | PASS |
Detailed Analysis of KRAFT HEINZ CO
BRITISH AMERICAN TOBACCO PLC (ADR) (BTI) is a large-cap growth stock in the Tobacco industry. The rating according to our strategy based on David Dreman is 64% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: British American Tobacco p.l.c. is a global multi-category consumer goods business company. The Company provides tobacco and nicotine products. Its segments include the United States, Asia Pacific Middle East and Africa, and Americas and Europe. Its product categories include Vapor, Heating Products (HPs), Modern Oral, Traditional Oral, and Combustible cigarettes. Vapor products are handheld, battery-powered devices that heat a liquid to produce an inhalable aerosol, known as vapor. HPs are devices that use heat to generate a nicotine-containing aerosol, which the user inhales. This category includes Tobacco Heated Products and Herbal Products for Heating (HPH). Modern Oral products are smoke-free oral nicotine products called nicotine pouches, designed for use in the mouth. Traditional oral products include snus and snuff. Its brands include Vuse, glo, Velo, Grizzly, Dunhill, Kent, Lucky Strike, Pall Mall, Rothmans, Newport, Natural American Spirit, Camel, and others.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
| MARKET CAP: | PASS |
| EARNINGS TREND: | PASS |
| EPS GROWTH RATE IN THE IMMEDIATE PAST AND FUTURE: | FAIL |
| P/E RATIO: | FAIL |
| PRICE/CASH FLOW (P/CF) RATIO: | FAIL |
| PRICE/BOOK (P/B) VALUE: | FAIL |
| PRICE/DIVIDEND (P/D) RATIO: | PASS |
| CURRENT RATIO: | FAIL |
| PAYOUT RATIO: | PASS |
| RETURN ON EQUITY: | FAIL |
| PRE-TAX PROFIT MARGINS: | PASS |
| YIELD: | PASS |
| LOOK AT THE TOTAL DEBT/EQUITY: | PASS |
Detailed Analysis of BRITISH AMERICAN TOBACCO PLC (ADR)
ALBERTSONS COMPANIES INC (ACI) is a large-cap value stock in the Retail (Grocery) industry. The rating according to our strategy based on David Dreman is 61% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Albertsons Companies, Inc. is a food and drug retailer in the United States. The Company is engaged in the operation of food and drug retail stores that offer grocery products, general merchandise, health and beauty care products, pharmacy, fuel and other items and services in its stores or through digital channels. It operates approximately 2,257 retail stores with 1,720 in-store pharmacies, 405 associated fuel centers, 22 dedicated distribution centers and 19 manufacturing facilities. The Company operates stores across 35 states and the District of Columbia under 22 banners, including Albertsons, Safeway, Vons, Jewel-Osco, Shaw's, ACME, Tom Thumb, Randalls, United Supermarkets, Pavilions, Star Market, Haggen, Carrs, Kings Food Markets and Balducci's Food Lovers Market. Its own brands include Signature SELECT, Open Nature, Lucerne, Waterfront BISTRO, Signature Reserve and Value Corner, among others.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
| MARKET CAP: | PASS |
| EARNINGS TREND: | FAIL |
| EPS GROWTH RATE IN THE IMMEDIATE PAST AND FUTURE: | FAIL |
| P/E RATIO: | PASS |
| PRICE/CASH FLOW (P/CF) RATIO: | PASS |
| PRICE/BOOK (P/B) VALUE: | FAIL |
| PRICE/DIVIDEND (P/D) RATIO: | FAIL |
| CURRENT RATIO: | FAIL |
| PAYOUT RATIO: | FAIL |
| RETURN ON EQUITY: | PASS |
| PRE-TAX PROFIT MARGINS: | FAIL |
| YIELD: | PASS |
| LOOK AT THE TOTAL DEBT/EQUITY: | FAIL |
Detailed Analysis of ALBERTSONS COMPANIES INC
TARGET CORP (TGT) is a large-cap value stock in the Retail (Department & Discount) industry. The rating according to our strategy based on David Dreman is 61% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Target Corporation is a general merchandise retailer selling products to its guests through its stores and digital channels. The Company offers customers, referred to as guests, everyday essentials and fashionable, differentiated merchandise at discounted prices. The majority of its stores offer a wide assortment of general merchandise and food. Its merchandise categories include apparel and accessories, beauty and household essentials, food and beverage, hardlines, and home furnishings and decor. Most of its stores are larger than 170,000 square feet, offer a variety of general merchandise and a full line of food items comparable to traditional supermarkets. Its digital channels include a wide merchandise and food assortment, including many items found in its stores, along with a complementary assortment sold by the Company and third parties. Its brands include A New Day, Ava & Viv, Cloud Island, Favorite Day, and others. It serves guests at nearly 2,000 stores and at Target.com.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
| MARKET CAP: | PASS |
| EARNINGS TREND: | FAIL |
| EPS GROWTH RATE IN THE IMMEDIATE PAST AND FUTURE: | FAIL |
| P/E RATIO: | FAIL |
| PRICE/CASH FLOW (P/CF) RATIO: | PASS |
| PRICE/BOOK (P/B) VALUE: | FAIL |
| PRICE/DIVIDEND (P/D) RATIO: | PASS |
| CURRENT RATIO: | FAIL |
| PAYOUT RATIO: | FAIL |
| RETURN ON EQUITY: | PASS |
| PRE-TAX PROFIT MARGINS: | FAIL |
| YIELD: | PASS |
| LOOK AT THE TOTAL DEBT/EQUITY: | FAIL |
Detailed Analysis of TARGET CORP
About David Dreman: Dreman's Kemper-Dreman High Return Fund was one of the best-performing mutual funds ever, ranking as the best of 255 funds in its peer groups from 1988 to 1998, according to Lipper Analytical Services. At the time Dreman published Contrarian Investment Strategies: The Next Generation, the fund had been ranked number one in more time periods than any of the 3,175 funds in Lipper's database. In addition to managing money, Dreman is also a longtime Forbes magazine columnist.
About Validea: Validea is aninvestment researchservice that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
