World Grain - February 2015 - (Page 54)

FEATURE Investment analysts guarded about W 2015 hile shares of many grain-based foods companies climbed impressively to new highs in 2014, investment analysts were hard pressed to paint an optimistic picture for the segment when considering the stock market outlook for 2015. Viewed from a number of perspectives, the analysts interviewed by Milling & Baking News, sister publication of World Grain, said headwinds facing many companies in the industry created investment risks that overshadowed the attraction that lifted the group for several years, a longer period than many on Wall Street had expected. A consumer migration away from carbohydrates and toward protein, a trend that has shifted in style and emphasis over the years, continued in 2014 and will persist in 2015, said Rob Moskow, an analyst with Credit Suisse, New York. Moskow and the other analysts said companies most able to understand and meet consumer demand for products viewed as "healthier" stand the best chance of prospering ahead. The ready-to-eat cereal, Moskow said. "People are eating less breakfast cereal in the morning and are eating more protein," he said. "They believe lower carb, lower gluten diets are healthier. Consumer packaged foods "When I look at my coverage list of 15 companies, about 10 missed their expectations for the year. That included most of the blue chip branded companies. Protein companies did better, exceeding expectations. I think it's no accident that Hormel and Tyson both had very strong years. In the case of Tyson, top-line success was a key. Chicken demand was very strong. Hormel experienced the same thing. The companies would not have been able to achieve their bottom-line results without having solid supply and demand economics." Many of the companies that struggled were described by by L. Josh Sosland Most are hard pressed to paint an optimistic picture for grain-based food company shares natural and organic companies. "According to Nielsen data, the top 25 food and beverage companies have lost 420 points of basis share to entrepreneurial competitors," he said. "A lot of the brands are losing their resonance with consumers at a slow but steady pace." tional supermarkets and the shift toward other channels will continue in 2015 and will factor in the investment prospects of consumer packaged goods companies in 2015, said Mitchell B. Pinheiro, senior vice-president, Imperial Capital LLC, New York, New York, U.S. "Customers are moving toward the club, dollar and the natural channels," Pinheiro said. "This will continue at a slow but measurable rate. And it will help determine which companies have success or struggles." Among the growing channels, Pinheiro is focused in his practice with Imperial on the natural segment, or health and wellness more generally, for investment opportunities. The proPinheiro said. "You see Whole Foods, Sprouts and Natural Grocers growing at a 15% to 20% clip," he said. "Well those stores don't have than others in getting into these stores. General Mills, Inc. and aged foods companies are losing ground in competition with 54 February 2015 / World Grain /

Table of Contents for the Digital Edition of World Grain - February 2015

World Grain - February 2015
Table of Contents
From the Editor-in-chief - Easing embargo on Cuba a world gain
Calendar of Events
119th Annual IAOM Conference and Expo
News Review - NIBULON reports record grain, oil crop exports
Nidera building silo on Danube in Romania
Algeria’s cereal imports increase by $3.5 billion
ADM strengthens Unilever relationship
Cargill’s net earnings up 41%
Grain, biofuel shipments surge at Port of Prince Rupert
CHS reports 56% increase in first-quarter earnings
KSU names Grain Science and Industry Department head
Port of Paranaguá sets record for grain handling
Bullish economics may force grain prices lower
IGC forecasts world wheat production at 701 million tonnes
Carr’s Milling profit up on strong performance
Bay State Milling expanding in Arizona
AGRANA earnings drop 25%
Canada introduces act to modernize grain industry
Grain Market Review - Rice
Country Focus - Syria
Feature - Ethiopia Striving for Grain Surpluses
Feature - CWB Taken off Life Support
CWB's Asset List
Feature - Europe's Largest Port Keeps Growing
Deep History
Feature - Grain Experts Analyze Black Sea
Feature - Investment analysts guarded about 2015
Feature - Another year of advances
Rice Quarterly - Milling Properties of Commingled Rice
Vietnam’s outlook for rice exports mediocre for 2015
Myanmar’s rice exports to China surge
African countries focus on boosting rice production
Thai rice exports to dominate
Feature - U.K. Milling Industry checking for soy in flour
Feed Operations - Upgrade ideas for your feed mill
Feature - Comparing Major Soybean Exporters
Feature - The importance of Landscaping
Feature - Global feed tonnage increases
Supplier News
Product Showcase
World Grain Archive
Ad Index/Reader Information Form International Faxback Program

World Grain - February 2015