Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

General Mills (NYSE:GIS) Is Ready to Feast on the Competition


The company's aggressive overseas expansion and new product launches are starting to pay off.

Top-quality food stocks can make great additions to your portfolio, for a number of reasons.

For one, these companies are more resistant to economic downturns because their products are in no way discretionary purchases: Even when a deep slump hits, people have to eat. That makes their shares much less volatile than the overall market, so they're a good way to temper your exposure to more unpredictable sectors, like technology or resources.

But the best of the best aren't just resting on their laurels; they're also investing in new foods that will help them enter new markets and capitalize on long-term trends, like the move toward healthier eating, which has gained momentum over the past decade.

To top it off, foodmakers' steady sales give them the predictable cash flows they need to pay dividends. And their payouts are often attractive: General Mills (NYSE: GIS), for example, has been paying dividends without an interruption or a cut for longer than most American companies have even been around: 113 years-and counting. Its current quarterly payout of $0.33 a share-or $1.32 a year-yields 3.3%.

The company controls some of the most recognizable brands in the food business, including Hamburger Helper, Cheerios, Wheaties, and Betty Crocker.

Moreover, because of its stability-General Mills stock currently sports a beta rating of just 0.16, with a rating of 1 being equal to the market's volatility-the shares fell less sharply than the overall market during the 2008-2009 financial crisis. However, the stock has languished over the past year, remaining mostly flat, compared to a 21% gain for the Dow (INDEXDJX:.DJI).

One factor holding back all food companies has been rising ingredient costs, which many, including General Mills, have had difficulty passing on to consumers due to the slow economy.
< Previous
No positions in stocks mentioned.
Featured Videos