Despite its name, which might make you think the company was founded by Alcatraz farmers, food producer ConAgra (NYSE:CAG) deserves the same respect as competitors like H.J. Heinz (NYSE:HNZ) and Sara Lee. And with ConAgra's stock trading at a discount to its peers, investors who act now might enjoy an early-bird special.

Heating up results
Years of restructuring have made ConAgra, whose brands include Orville Redenbacher's, Hunt's, and Slim Jim, a more focused and profitable operation. Its newly notable strengths include innovations in the frozen-food category. Management is particularly high on the repackaged Healthy Choice brand, which includes the Healthy Choice Naturals and Steamers lines, with a new ad campaign featuring a spunky Julia Louis-Dreyfus. At the economy end of the price spectrum, Banquet frozen meals -- selling for as little as a buck apiece -- saw double-digit net sales growth and wider margins in the recently completed quarter. Trends of affordable at-home eating should keep both of these brands growing at a healthy clip.

Excluding the boost provided by an extra week in this year's quarter, it appears that ConAgra's commercial food-service segment saw roughly flat volume in fiscal 2009's fourth quarter -- essentially in line with food-service results recently posted by J.M. Smucker (NYSE:SJM) and others. A core business of providing specialty potato products, mostly to quick-service restaurants such as McDonald's (NYSE:MCD) and Yum! Brands (NYSE:YUM), should help the segment withstand the broad slump in dine-out eating. However, at 37% of ConAgra's total sales, more than double that of other food makers, the segment could deep-fry overall growth if consumers reverse their trend toward cheaper fast-food eateries.

Shares at cost-cutter prices
Management has recently done a commendable job of hacking away at operating costs, and continued productivity gains look like a significant near-term financial opportunity. While it's not as well-defined as Kellogg's (NYSE:K) $1 billion-"K-Lean" savings initiative, ConAgra's efficiency focus may yield a similar result in coming years. Moreover, if the recent fiscal year is a reliable guide, the up-front costs of achieving those savings will be dramatically lower than Kellogg's. How's that for a shareholder coupon?

Brand competition and commodity costs notwithstanding, the most noticeable threat to ConAgra's prospects may be operational execution. Although it looks like the company's checkout line is poised for brisk business, management needs to prove that it can make that happen after years of acquisitions and divestitures. The market, for one, seems to want an extra helping of proof with its pudding.

Personally, I think that the stock's 10.7 forward P/E is an overly steep discount to peer companies such as Kraft (NYSE:KFT), which trades at a 25% higher valuation.

If management can hit its earnings-per-share growth target of 8%-10% going forward, investors who buy now may eventually look back with a well-fed smile, recalling how they conned Mr. Market.

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