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Get Over the Meme Frenzy, Dig Into These 4 Food Stocks Instead
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Not all that glitters is gold. Likewise, appears to be the whole meme mania. While meme stocks have garnered too much attention lately, thanks to robust returns, these stocks usually lack fundamental strength and have no positive news triggering the upside. The stupendous momentum they have been witnessing is mainly driven by their popularity among retail investors on social media platforms like Reddit and Twitter.
Majorly led by video-game retailer GameStop Corp. (GME - Free Report) , the much-talked about meme rally was joined by AMC Entertainment Holdings, Inc. (AMC - Free Report) and BlackBerry Limited (BB - Free Report) . While shares of GameStop and AMC Entertainment have soared more than 1000% so far this year, BlackBerry has seen a greater than 80% jump in the same time frame.
Be Wise, Penny Wise
Delving too much in this social-media driven meme rally may not be the best thing to do in the long run. Instead, it is wiser to grab stocks with sound fundamentals and favorable economic factors acting as support. On that note, we have shifted our focus to food stocks, which form an essential part of the Consumer Staples sector – largely familiar as the defensive zone.
We note that food stocks have been benefiting from increased consumer demand amid the pandemic-induced elevated at-home consumption. Although things have opened up and people have started stepping out, the at-home dining trends are likely to stay, or at least improve from the pre-pandemic levels as a number of Americans have cultivated cooking and baking at home as a new habit since the onset of the pandemic. That being said, the away-from-home food demand is likely to keep recovering, with restaurants, cafes, offices and other social institutions opening up. In fact, in the last earnings season, many food companies spoke about witnessing a rebound in their foodservice channels.
A number of food companies have been making the most of these trends on the back of their concerted strategic endeavors like focus on innovation, product upgrades and portfolio refinement via prudent buyouts and divestitures. Also, companies have been undertaking efforts to resonate with consumers’ changing tastes and preferences. Speaking of which, they have been coming up with organic and natural food choices – as health and wellness have gained further importance amid the pandemic. Apart from this, some companies have been investing in digital capabilities, given consumers’ growing inclination toward online shopping.
All said, we have hand-picked four delicacies from the Zacks Food – Miscellaneous space. These favorably-ranked stocks with impressive fundamentals have seen their shares surge at least 25% in the past year – outdoing the industry’s growth of 23.4%.
Image Source: Zacks Investment Research
4 Stocks Worth Relishing
Darling Ingredients Inc. (DAR - Free Report) is a robust bet, with its shares soaring a significant 183.3% in a year. The global provider of natural ingredients is benefiting from focus on boosting portfolio through innovation. Moreover, the company’s capacity expansion investments bode well. Apart from these, Darling Ingredients’ feed segment is benefiting from a favorable commodity price environment for proteins and animal fats, among others. The Zacks Consensus Estimate for its current fiscal-year earnings indicates an increase of 55.6% from the year-ago period’s reported figure. The Zacks Rank #1 (Strong Buy) company has a trailing four-quarter earnings surprise of 29.8%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
Medifast, Inc. (MED - Free Report) is another lucrative option, which has gained a whopping 94% in the past year. This manufacturer and distributor of clinically-proven healthy living products and programs has been flourishing on strength in its OPTAVIA lifestyle solution and coaching support system, given the evolving consumer interests in health and wellness. Moreover, management is focused on optimizing and increasing capacity by strengthening its network of co-manufacturers. Apart from this, Medifast’s focus on the development of a digital-first approach is yielding results. The Zacks Consensus Estimate for its current fiscal-year earnings suggests growth of 49.1% from the figure recorded in the year-ago period. Impressively, the Zacks Rank #1 company has a trailing four-quarter earnings surprise of 12.7%, on average.
The Hain Celestial Group, Inc. (HAIN - Free Report) is also worth mentioning. The manufacturer, marketer, and seller of organic and natural products has been gaining from prudent investments in key brands and transformation efforts, including SKU rationalization. Also, its well-chalked supply chain initiatives have been yielding well. Notably, this Zacks Rank #2 (Buy) company has seen its shares increase 27.9% over the past year. The Zacks Consensus Estimate for its current fiscal-year earnings calls for a solid 72.6% rise from the prior year’s reported number. Hain Celestial has a trailing four-quarter earnings surprise of 26.4%, on average.
Investors’ appetite can be satiated with Nomad Foods Limited (NOMD - Free Report) , which flaunts a Zacks Rank #2. This provider of frozen foods is gaining on solid brand-building investments along with its effective advertising and innovation. Moreover, the company’s planned acquisition of Fortenova's Frozen Food Group bodes well. The Zacks Consensus Estimate for its current fiscal-year earnings calls for growth of 24.7% from the prior-year’s reported figure. Nomad Foods has a trailing four-quarter earnings surprise of 10.3%, on average. Shares of the company have rallied 32.9% in a year’s time.
Zacks Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
Image: Bigstock
Get Over the Meme Frenzy, Dig Into These 4 Food Stocks Instead
Not all that glitters is gold. Likewise, appears to be the whole meme mania. While meme stocks have garnered too much attention lately, thanks to robust returns, these stocks usually lack fundamental strength and have no positive news triggering the upside. The stupendous momentum they have been witnessing is mainly driven by their popularity among retail investors on social media platforms like Reddit and Twitter.
Majorly led by video-game retailer GameStop Corp. (GME - Free Report) , the much-talked about meme rally was joined by AMC Entertainment Holdings, Inc. (AMC - Free Report) and BlackBerry Limited (BB - Free Report) . While shares of GameStop and AMC Entertainment have soared more than 1000% so far this year, BlackBerry has seen a greater than 80% jump in the same time frame.
Be Wise, Penny Wise
Delving too much in this social-media driven meme rally may not be the best thing to do in the long run. Instead, it is wiser to grab stocks with sound fundamentals and favorable economic factors acting as support. On that note, we have shifted our focus to food stocks, which form an essential part of the Consumer Staples sector – largely familiar as the defensive zone.
We note that food stocks have been benefiting from increased consumer demand amid the pandemic-induced elevated at-home consumption. Although things have opened up and people have started stepping out, the at-home dining trends are likely to stay, or at least improve from the pre-pandemic levels as a number of Americans have cultivated cooking and baking at home as a new habit since the onset of the pandemic. That being said, the away-from-home food demand is likely to keep recovering, with restaurants, cafes, offices and other social institutions opening up. In fact, in the last earnings season, many food companies spoke about witnessing a rebound in their foodservice channels.
A number of food companies have been making the most of these trends on the back of their concerted strategic endeavors like focus on innovation, product upgrades and portfolio refinement via prudent buyouts and divestitures. Also, companies have been undertaking efforts to resonate with consumers’ changing tastes and preferences. Speaking of which, they have been coming up with organic and natural food choices – as health and wellness have gained further importance amid the pandemic. Apart from this, some companies have been investing in digital capabilities, given consumers’ growing inclination toward online shopping.
All said, we have hand-picked four delicacies from the Zacks Food – Miscellaneous space. These favorably-ranked stocks with impressive fundamentals have seen their shares surge at least 25% in the past year – outdoing the industry’s growth of 23.4%.
4 Stocks Worth Relishing
Darling Ingredients Inc. (DAR - Free Report) is a robust bet, with its shares soaring a significant 183.3% in a year. The global provider of natural ingredients is benefiting from focus on boosting portfolio through innovation. Moreover, the company’s capacity expansion investments bode well. Apart from these, Darling Ingredients’ feed segment is benefiting from a favorable commodity price environment for proteins and animal fats, among others. The Zacks Consensus Estimate for its current fiscal-year earnings indicates an increase of 55.6% from the year-ago period’s reported figure. The Zacks Rank #1 (Strong Buy) company has a trailing four-quarter earnings surprise of 29.8%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
Medifast, Inc. (MED - Free Report) is another lucrative option, which has gained a whopping 94% in the past year. This manufacturer and distributor of clinically-proven healthy living products and programs has been flourishing on strength in its OPTAVIA lifestyle solution and coaching support system, given the evolving consumer interests in health and wellness. Moreover, management is focused on optimizing and increasing capacity by strengthening its network of co-manufacturers. Apart from this, Medifast’s focus on the development of a digital-first approach is yielding results. The Zacks Consensus Estimate for its current fiscal-year earnings suggests growth of 49.1% from the figure recorded in the year-ago period. Impressively, the Zacks Rank #1 company has a trailing four-quarter earnings surprise of 12.7%, on average.
The Hain Celestial Group, Inc. (HAIN - Free Report) is also worth mentioning. The manufacturer, marketer, and seller of organic and natural products has been gaining from prudent investments in key brands and transformation efforts, including SKU rationalization. Also, its well-chalked supply chain initiatives have been yielding well. Notably, this Zacks Rank #2 (Buy) company has seen its shares increase 27.9% over the past year. The Zacks Consensus Estimate for its current fiscal-year earnings calls for a solid 72.6% rise from the prior year’s reported number. Hain Celestial has a trailing four-quarter earnings surprise of 26.4%, on average.
Investors’ appetite can be satiated with Nomad Foods Limited (NOMD - Free Report) , which flaunts a Zacks Rank #2. This provider of frozen foods is gaining on solid brand-building investments along with its effective advertising and innovation. Moreover, the company’s planned acquisition of Fortenova's Frozen Food Group bodes well. The Zacks Consensus Estimate for its current fiscal-year earnings calls for growth of 24.7% from the prior-year’s reported figure. Nomad Foods has a trailing four-quarter earnings surprise of 10.3%, on average. Shares of the company have rallied 32.9% in a year’s time.
Zacks Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>