Hedgeye CEO Keith McCullough is adding Conagra Brands (CAG) to the long side of Investing Ideas. Below is a brief note.
Some people love to chase price. I love looking for sales.
Conagra Brands (CAG) is on a -2% sale here into the close, signaling immediate-term TRADE #oversold within Consumer Staples analysts (Howard Penney and Daniel Biolsi) Bullish @Hedgeye TREND view.
Here's a little love on that idea from their Institutional Research product:
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Conagra announced on Friday that retail sales for the ten weeks ended May 3 had increased 37.2%. Conagra's grocery and refrigerated sales grew 53.5%, frozen goods grew 29.7%, frozen meals grew 27.1%, and retail snack sales grew by 20.4%. Conagra is different in that the entire COVID-19 period is in a single quarter instead of being split between the stockpiling and elevated spend period. When the company provided the last update at the end of March, QT trends were up 47%. Conagra's sales outperformed in both the stockpiling and elevated spend periods, and market expectations are now aligned. We are adding Conagra to our Long Bias list. Conagra is the fifth-largest food company in the U.S. with only 10% of sales from foodservice companies. We believe there is an upside to consensus estimates driven by the calorie shift to food at home, the strength in the frozen category from COVID-19, and the accelerating growth in snacking during an extended stay at home restrictions. |
Buyem on sale,
KM