After Monday’s Volatility, Consider These 4 High-Growth Consumer Staples Stocks

After Monday’s Volatility, Consider These 4 High-Growth Consumer Staples Stocks

Research  these Stocks on Kapitall’s Playground Now

 
research now

Stocks fell and recovered slightly on Monday amidst fears of the Federal Reserve’s stimulus tapering and China’s cash crunch. The Dow Jones declined 0.94%, the Nasdaq lost 1.09%, and the S&P 500 dropped 1.21%. NBC News reports that the CBOE Volatility Index (VIX), which assesses market expectations of volatility within the S&P 500, was above 20 at the end of trading. A VIX reading below 20 tends to reflect calmer markets while values exceeding 30 usually correlate with great volatility.

The AP writes that each of the S&P 500’s ten industry groups posted losses yesterday, with bank and financial stocks leading the way with a 1.8% loss. Wall Street saw poor performances from financial stocks across the board while defensive sectors, such as consumer staples and utilities, drove the rebound.

Investing Ideas

To construct the list below, we drew our inspiration from Monday’s rollercoaster ride and turned our attention to consumer staples stocks. Consumer staples are regularly purchased goods: examples include beverages, food, cigarettes, toilet paper, and other household items. Since consumer staples are essential products, these stocks are appealing for investors seeking relatively stable investments. We began with a universe comprised of consumer staples stocks, which we subsequently screened for encouraging growth indicators.

For our first screen, we looked for companies experiencing faster growth in revenue than inventory over the last year. As inventory is the portion of goods not yet sold, revenue growth that outpaces inventory growth shows that a company is able to sell its products and has healthy turnover.

We then looked for stocks that are expected to achieve high earnings growth in the future, with 5-year projected EPS growth above 15%. We were left with four stocks on our list.

The List

Do you believe in the growth potential of these stocks? Use this list as are a starting point for your own analysis.

1. Inventure Foods (SNAK, Earnings, Analysts, Financials): Engages in the development, production, marketing, and distribution of snack food products and frozen berry products to grocery retailers, mass merchandisers, club stores, convenience stores, and vend distributors in the United States and internationally.

Market cap at $150M, most recent closing price at $7.81.

Revenue grew by 3.23% during the most recent quarter ($48.54M vs. $47.02M y/y). Inventory grew by -21.23% during the same time period ($22.07M vs. $28.02M y/y). Inventory, as a percentage of current assets, decreased from 58.72% to 47.36% during the most recent quarter (comparing 3 months ending 2013-03-30 to 3 months ending 2012-03-31).

5-year projected EPS growth at 20.0%.
 

2. Farmer Brothers Co. (FARM, Earnings, Analysts, Financials): Engages in the manufacture, wholesale, and distribution of coffee, tea, and culinary products in the United States.

Market cap at $222.14M, most recent closing price at $14.24.

Revenue grew by 3.96% during the most recent quarter ($126.34M vs. $121.53M y/y). Inventory grew by -11.21% during the same time period ($67.27M vs. $75.76M y/y). Inventory, as a percentage of current assets, decreased from 52.89% to 47.03% during the most recent quarter (comparing 3 months ending 2013-03-31 to 3 months ending 2012-03-31).

5-year projected EPS growth at 20.00%.
 

3. Bunge Limited (BG, Earnings, Analysts, Financials): Engages in the agriculture and food businesses worldwide.

Market cap at $10.12B, most recent closing price at $69.00.

Revenue grew by 14.53% during the most recent quarter ($14,785M vs. $12,909M y/y). Inventory grew by -4.62% during the same time period ($6,074M vs. $6,368M y/y). Inventory, as a percentage of current assets, decreased from 43.17% to 30.69% during the most recent quarter (comparing 3 months ending 2013-03-31 to 3 months ending 2012-03-31).

5-year EPS growth at 18.35%.
 

4. Green Mountain Coffee Roasters Inc. (GMCR, Earnings, Analysts, Financials): Engages in the specialty coffee and coffee maker business.

Market cap at $10.91, most recent closing price at $73.33.

Revenue grew by 13.53% during the most recent quarter ($1,004.79M vs. $885.05M y/y). Inventory grew by -2.46% during the same time period ($587.28M vs. $602.12M y/y). Inventory, as a percentage of current assets, decreased from 52.23% to 48.08% during the most recent quarter (comparing 13 weeks ending 2013-03-30 to 13 weeks ending 2012-03-24).

5-year EPS growth at 21.50%
 

 

(List compiled by Mary-Lynn Cesar. Accounting data sourced from Google Finance. All other data sourced from Finviz.)

 

Analyze These Ideas: Getting Started

 

playfor100kwirebanner2png

Leave a Reply

Protected by WP Anti Spam

hrtwirebanner2png