Monday, April 30, 2007

Got Milk Stocks?

Because of concerns of children’s health and obesity, yogurt may start appearing in schools as a snack, due to recommendations from The Institute of Medicine. News continues to come out about the health benefits of yogurt, one of the products made from milk.

Companies in the dairy products business with market capitalizations above $350 million are limited. The largest in terms of market cap is Groupe DANONE (DA), is a French company founded in 1899 which has ADR’s that trade on the New York Stock Exchange; however, they are planning on delisting their ADR’s due to the cost. They produce fresh dairy products under Danone brand, including yogurts, dairy desserts, infant foods, and probiotic dairy products. One of their major brands is Dannon yogurt. They also distribute Evian water. The stock has a P/E of 22 and a PEG ratio of 1,9, with a dividend of 1.1%.

Second largest at one tenth the size by market cap is Dean Foods Co. (DF). This Dallas, Texas based company distributes branded and private label dairy products, including yogurt, butter, cheese, cottage cheese, sour cream, half-and-half, whipping cream, dairy coffee creamers, and ice cream. Their P/E is 22.4 with a PEG of 1.9. Their earnings call is scheduled for May 3.

Wimm-Bill-Dann Foods OJSC (WBD) is the third largest company, and is based in Moscow, Russia. They produce pasteurized milk, yogurt, butter, cream, cheese, kefir, cottage cheese, sour cream, puddings, and cheese. The P/E is 37, their PEG is .4 and they pay a small yield of .3%.

A U. S. based company with an international flavor is Synutra International Inc. (SYUT), which is in the business of marketing dairy-based nutritional products, nonfat dry milk and anhydrous milk-fat in China. The stock carries a P/E of 25. Their Price Sales ratio is 3.2. They don’t pay a dividend.

As you can see, publicly traded dairy stocks are few and far between, and the ones that are public are from all over the world.

Author does not own any of the above.

1 comment:

Bob said...

One that could be added to this list is LWAY (Lifeway).