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The Best Food Stocks to Buy Now

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  • (0:20) - Disruption In Food Industry: Amazon Acquisition
  • (4:15) - Will Amazon Go On A Buying Spree?
  • (8:50) - Blue Apron IPO
  • (17:50) - Costco: Family Food Shopping
  • (22:30) - Sprouts Farmers Market vs Whole Foods
  • (25:30) - Episode Roundup: Podcast@Zacks.com

Welcome to Episode #87 of the Zacks Market Edge Podcast.

Every week, host and Zacks stock strategist, Tracey Ryniec, will be joined by guests to discuss the hottest investing topics in stocks, bonds and ETFs and how it impacts your life.

In this episode, Tracey is joined by Maddy Johnson, a Zacks Editor, and a user of some of the food delivery services, to discuss the rumors and wishful thinking of investors now that Amazon is going to acquire Whole Foods in a $13.7 billion acquisition.

This is a seminal event in the food industry as it will combine Whole Foods big city stores and upper income customer base, with Amazon’s amazing warehouse and distribution system. The supermarket may never be the same again.

Tracey and Maddy explore what is NOT going to happen in the near term (Amazon acquiring Restoration Hardware (RH), for instance) with discussion of other possibilities like an acquisition of restaurant delivery service GrubHub .

But some companies will be directly impacted by this merger. What does their future hold and should you be investing?

Direct Competitors: Winners or Losers?

1.       Costco (COST - Free Report) has been posting stellar same-store sales growth recently, with US comps of 6% last quarter. Shares are down over 5% since the merger announcement. Is there a buying opportunity in Costco?

2.       Kroger (KR - Free Report) was already hurting before the announcement. Are the general supermarkets still in play?

3.       Sprouts Fresh Market (SFM - Free Report) , a smaller organic supermarket chain, has been partnering with Amazon in some cities to provide Amazon Prime delivery. What happens to that deal now? Should investors be buying in?

4.       Blue Apron (will have a ticker of APRN) is about to go IPO. The meal kit delivery service has never been profitable. Will this IPO go boom or bust?

To understand Amazon, Tracey urges podcast listeners to check out the book “The Everything Store.” Even though it’s a few years old now, it’s key to dialing into Amazon’s culture.

And what about just buying Amazon (AMZN - Free Report) shares? Should investors still be getting in?

Find out the answers to this and more on this week’s podcast.

[In full disclosure, Tracey owns shares of AMZN and RH in her personal portfolio.]

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