We have issued an updated research report on the premium meat products company Hormel Foods Corporation HRL on Dec 28, 2015. The company produces and sells a variety of meat and other food items on a global basis. However, despite holding a high brand value in the market, the firm is currently plagued by certain headwinds in its business.
Bullish Aspects
Hormel Foods’ innovation-based growth strategy helps it enhance the demand in several of its product categories. Moreover, the company’s margin is improving on the back of cost-saving programs and lower input prices. The company is also making concerted efforts to develop its business with the help of competent solutions and value-added marketing strategies. At the same time, recently inked acquisition deals are expected to bear fruits, going ahead.
Few Business Issues
We believe that this Zacks Rank #2 (Buy) stock would continue to improve its top- and bottom-line results in the quarters ahead. However, certain industry-specific negativities might dampen its commercial prospects. For instance, the highly contagious Avian influenza continues to create operational challenges for meat producers such as Hormel Foods. Moreover, the company’s international business is exposed to risks arising from unfavorable currency fluctuations.
Other Stocks to Consider
Other well-ranked stocks in the industry include Tyson Foods, Inc. TSN, Blue Buffalo Pet Products, Inc. BUFF and The Chefs' Warehouse, Inc. CHEF. All three stocks carry the same Zacks Rank as Hormel Foods.
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