At first glance, agribusiness giant ConAgra
But like a bag of popcorn with too many unpopped kernels, ConAgra's stock might disappoint those who expect predictable performance. As fellow Fool Nathan Parmelee wrote recently, things will likely get a bit darker for the company before they brighten.
ConAgra has recently divested many of its commodity businesses to focus on retail products, such as Orville Redenbacher's, Marie Callender's, and Chef Boyardee, which can command higher profit margins than the chicken and beef sold in a grocer's butcher aisle. Retail products now comprise 60% of ConAgra's $14.6 billion in sales and 68% of its $1.7 billion in operating profit. The decision to emphasize branded products is partly driven by the growing consolidation of the retail distributors like Wal-Mart
Unfortunately for ConAgra, consumers still consider the company's brands to be second-tier -- ConAgra's Hunt's ketchup isn't H.J. Heinz
Gary Rodkin has taken over as ConAgra's CEO, and he brings the marketing savvy that he acquired during many years as the head of PepsiCo's
ConAgra is taking the correct steps to improve its competitive position, but its success is far from certain. The company competes with bigger rivals like Kraft
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