Hormel Foods Corporation (HRL) has entered into a definitive agreement to acquire the Country Crock chilled side dish line from Unilever United States Inc., of Englewood Cliffs, N.J. The transaction is expected to close by February 2010. However, the terms were not disclosed.

The Country Crock chilled side dish line consists of 10 varieties of refrigerated, microwaveable, multi-portion, potato-/pasta-based side dish products. The line, first introduced in 2004, is a strong player in the refrigerated side dish segment.

Although, Hormel’s strategy to grow through acquisitions carries several potential risks, it is well positioned for acquisitions to strengthen its growth profile. Given the company’s strong balance sheet and management’s track record of successful acquisitions integrated over the years, we expect acquisitions to play a key role in the company’s growth.

The Country Crock acquisition will help Hormel Foods advance its participation in the growing segments of convenient meals and side dishes. Hormel Foods currently manufactures and sells microwaveable main dishes including Hormel refrigerated entrees and Lloyd’s prepared entrees, consisting primarily of meat or poultry.

Hormel Foods is a leading manufacturer and marketer of various meat and food products. The company’s plans to increase spending on advertising would definitely help maintain and grow its market share. Although the food market is highly competitive, a greater share of value-added branded products in Hormel’s product mix will help strengthen its margins and reduce exposure to commodity prices in the long term. Thus, we maintain our Neutral recommendation on the stock.

Zacks Investment Research

1. (HRL) Hormel Foods Corporation – Annual Dividend was Raised 10.5%Hormel Foods Corporation (HRL), the manufacturer of food and meat products including SPAM, Hormel and...
2. (HRL) Hormel Foods Corporation Earnings Rise 54%Yesterday, Hormel Foods Corp. (HRL) reported heartening performance for the fourth quarter and fiscal year...
3. (HRL) Hormel Foods Corporation Earnings up 50% Quater Over QuarterHormel Foods Corporation (HRL), the food and meat products manufacturer which owns well-known consumer brands...
4. (HRL) Hormel Foods Corporation – Value – Zacks Rank BuyHormel Foods Corporation (HRL), the manufacturer of various food and meat products, reported second quarter...
5. (HRL) Hormel Foods Corporation – Value – Zacks Rank BuyHormel Foods Corporation (HRL), the food and meat products manufacturer, has surprised on estimates 5...
6. (HRL) Hormel Foods Corporation – Value – Zacks Rank BuyHormel Foods Corporation (HRL), the maker of SPAM and Dinty Moore stews, is seeing consumers...

Search Posts by Tag: Hormel Foods Corporation | HRL | Consumer Goods | Meat Products

RSS Feeds by Tag: Hormel Foods Corporation | HRL | Consumer Goods | Meat Products |

Other Posts by: vitalstocks | RSS Feed for this author