JM Smucker (“SJM”) is a smaller-sized, large-cap stock that is historically well-run, delivers consistent returns on capital and produces significant cash flow. The business is focused on a diversified portfolio of simple brand names that are found in most kitchens throughout the United States. SJM is at an inflection point in which its top line growth has decelerated, margins have compressed, and management is optimizing their product portfolio through prudent balance sheet management and strategic initiatives. Management incentives are aligned with shareholders and their CEO has been purchasing the stock recently. I believe investors have been overly pessimistic given the firm’s recent headwinds and have oversold the stock, leading to an attractive price to initiate a long-term position in a quality company. You can find my analysis here:
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- Uncle PennyBags