Hello Friends! You can tell that it is earnings season because our kind of stocks are showing up on the list of movers....first the GREAT earnings and then the BIG move...that is the premise that this entire site operates under...that earnings will eventually drive stock price! As always, I need to repeat the disclaimer you will find throught this website, PLEASE do your own investigation (due diligence) of all stock investment ideas suggested here, and PLEASE consult with your investment advisor as to the suitability and advisability of any investment here as they are PROFESSIONAL investment advisors and I am but an AMATEUR! Sigh. Just a BLOGGER.
Came across this one this afternoon while perusing the lists of movers...J&J Snack Foods Corp (JJSF). This is definitely NOT one of those hi-tech dot.com's! J&J is having a nice day today after posting earnings yesterday. As I write, JJSF is trading at $44.07, up $4.78 or 12.17% on the day. According to the Yahoo "Profile", J&J "...manufactures nutritional snack foods and distributes frozen beverages, which it markets throught the United States to the foodservice and retail supermarket industries. Its principal snack food products are soft pretzels marketed primarily under the brand name Superpretzel and frozen juice treats and desserts marketed primarily under the Luigi's, ICEE, Barq's, Chill and Minute Maid brand names." O.K. aren't you glad I wrote this AFTER lunch, I mean just writing about all that JUNK could give me a very bad case of the Munchies :).
Yesterday, after the close of trading, JJSF announced 2nd quarter 2004 results. For the quarter ended March 27, 2004, sales increased 17% to $95.2 million from $81.4 million the prior year. Earnings per share came in at $.36/diluted share vs $.33/diluted share last year.
What about longer-term? Checking "5-Yr Restated" financials on Morningstar.com, we can see the steady improvement in revenue from $288.4 million in 1999 to $367.3 million in the trailing twelve months. Earnings/share, after taking a dip to $1.10 in 2000, have improved steadily to the current $2.27 in the trailing twelve months.
How about free cash flow? This has been solidly positive, with $32 million reported in 2001, and $28 million reported in the trailing twelve months.
And the balance sheet? Per Morningstar.com, JJSF has $40.2 million in cash and $58.8 million in other current assets. This is PLENTY to cover BOTH the $34.8 million in current liabilities, and the $14.0 million in long-term liabilities.
How about Valuation? If we check "Key Statistics" on Yahoo we can see that this is a small cap company with a market cap of $382.05 million. The trailing p/e is very reasonable at 18.73 (imho), with a forward p/e (fye 27-Sep-05) at 14.82. Thus, the PEG is nice at 1.22, and the price/sales also nice at 0.94.
Yahoo reports only 8.80 million shares outstanding with 6.50 million of them that float. Currently, as of 3/8/04, there are 77,000 shares out short, which due to the low trading volume represents 2.567 trading days of short coverage. This represents only 1.18% of the float.
No cash dividends are paid and the last stock dividend reported on Yahoo is a 2:1 split last paid out on 8/15/89.
And how about Technicals? Looking at a "Point and Figure" chart on Stockcharts.com, we can see that the stock has been trading relatively sideways until early 2003 when it broke through a resistance level at $33 and has traded higher since. Recently the stock actually broke down through a support level of $45 in March, 2004. Today's move to $44 plus, gets it back to the previous support level.
What do I think. I love ICEE's. I love those big pretzels. And come to think of it, I love this stock. The valuation is beautiful with a moderate p/e and wonderful PEG and Price/Sales ratios. The balance sheet looks nice. Well what is stopping ME from buying some (I do not own ANY shares.)...do I need to REPEAT myself...but yikes, I am up to my ears in Margin and better wait, until, as planned, I sell a portion of one of my holdings at a gain...so I can add a new position! Ultimately, as you may recall, my goal is 25 stocks. You can view my current trading porfolio and see my current investments and past performance!
Thanks so much for stopping by. PLEASE feel free to email me if you have any questions, comments, or words of encouragement. Please let me know if you know of other similar investment BLOGS...I have linked to a few I know about...would be happy to share links with YOU if you have an investment blog..anyhow, email me at bobsadviceforstocks@lycos.com if you have anything you would like to tell me!
Bob