9/14/2023 0 Comments Pinterest foods![]() The underlying business, in other words, appears to be moving in the right direction as the company takes the normal industry approach to the headwinds it's facing. Notably, the year ended on a strong note, with the fourth-quarter adjusted gross profit margin up from 19.7% in the final stanza of 2021. But it recovered to 20.4% in the third quarter and 20.6% in the fourth. That fell to 16.5% in the second quarter, removing the impact of acquisitions and divestitures. ![]() For investors who likes to take a contrarian approach, B&G Foods' business model should be of interest.įor example, B&G's gross profit margin in the first quarter of 2022 was 19%. A good example here is Pirate's Booty, which B&G Foods acquired in 2013 for $195 million and sold in 2018 for $420 million to Hershey (NYSE: HSY). ![]() One of the first things B&G Foods did was introduce new flavors, a fairly simple decision, but one that probably couldn't compete with other uses of capital at Kraft.ī&G Foods also buys smaller brands that it nurtures, given that it often has a larger distribution network and greater advertising strength than what it's buying. B&G Foods takes the brand and gives it the love it lacked when it had to compete within a larger brand portfolio.Īn example is Cream of Wheat, which B&G Foods bought in 2007 from Kraft, back before it became Kraft Heinz (NASDAQ: KHC). This approach allows big companies to jettison unwanted and often lower-margin items so they can invest all of their time and money into their most profitable products. Essentially, B&G Foods buys from larger competitors brands that have fallen out of favor.
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