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B&G Foods Shares Popped: What You Need to Know

By Travis Hoium | More Articles
October 31, 2011 | Comments (2)

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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of B&G Foods (NYSE: BGS  ) jumped as much as 11% in trading today and hit a new 52-week high after the company made a dashing acquisition.

So what: B&G is buying Culver Brands from Unilever for $325 million in cash, a giant deal for the company. Culver's brands include Mrs. Dash, Molly McButter, Bakers Joy, and Static Guard.

Now what: Culver had just $90 million in revenue over the past year and even though this is a high margin business that's a steep price to pay for B&G. Management did say that it expected the acquisition to add to free cash flow and earnings immediately. The market may be cheering the move today, but I'm not seeing great value in this acquisition or in B&G's shares right now, so I'm going to pass on being bullish today.

Interested in more info on B&G Foods? Add it to your watchlist.

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Fool contributor Travis Hoium has no position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.

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Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On October 31, 2011, at 4:51 PM, jjcoxjj wrote:

    I've owned this stock for over a year now. I haven't seen them make many mistakes. I'm betting this will be another great long term deal for them

  • Report this Comment On November 01, 2011, at 8:32 AM, RickRickert4MVP wrote:

    Travis, I own this stock. Thanks for telling me about it popping, but I dislike your negative spin on it. Stay cool.

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Related Tickers

5/25/2012 4:00 PM
BGS $23.13 Up +0.80 +3.58%
B&G Foods, Inc. CAPS Rating: ****

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