Tag Archives: Kraft Foods

The 3 Silliest Company Name Changes Ever

By Dan Caplinger, The Motley Fool

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The best companies in the world invest huge amounts of money and energy into building name awareness. The right name can be worth tens of billions of dollars to a company, making it all the more important for companies to make the best choice.

Often, though, companies pick what seem on the surface to be ill-considered new names. Inspired by Thursday’s announcement from Coinstar to seek shareholder approval to change its name to Outerwall, here’s a list of five company name changes that earned criticism and even outright mockery when they were first proposed.

2001: Altria
In late 2001, the company then known as Philip Morris made a proposal to change its name to Altria. The origin of the name was founded in the Latin word “altus,” meaning “high,” and was meant to associate the company with peak performance. The “tri” embedded in the name also emphasized the fact that the company at the time had three distinct divisions: domestic tobacco, international tobacco, and its Kraft Foods beverage and food division.

Image copyright Altria Group.

The name change reflected the company’s wish to have consumers and investors see beyond its tobacco business, which at the time was plagued by more substantial legal battles with billions in potential liability hanging in the balance. Shareholders approved the name change in 2002. The irony, of course, is that Altria has since spun off both Kraft and its Philip Morris International global tobacco divisions, leaving Altria holding the old core Philip Morris USA division.

2011: Qwikster
Fortunately, this name change never actually took place, but for the short period that Netflix considered it, Qwikster caused both an uproar among customers and a crisis of confidence for Netflix investors. The idea was to separate out Netflix’s legacy DVD business from its faster-growing, higher-potential video streaming business and rename the DVD-delivery company Qwikster, with the streaming business keeping the Netflix name.

Image: Wikimedia Commons, photographed by user Coolcaesar.

But coming on the heels of a bungled rate-increase announcement that sent costs up as much as 60% for users who wanted to keep both services, the proposed Qwikster name became closely affiliated with the misstep. The stock also plunged, losing half its value — more than $100 per share — in less than a month from the time of the rate increase to the time Netflix backed away from the proposal.

2012: Mondelez International
Kraft has been associated with two different name-change controversies. Last year, the company broke into two parts, with its North American grocery division keeping the legacy Kraft name while its global snack-food business changed its name to Mondelez International . In explaining the change, the company said that Mondelez “is a newly coined word that evokes the idea of a world of ‘delicious products.'”

The company helped come up with the idea by having an

Source: FULL ARTICLE at DailyFinance

Kraft Foods Group Looks Tasty To $55

By Trefis Team, Contributor

In October 2012, Kraft Foods split into Mondelez International and Kraft Foods Group. Mondelez International operates the international snacks business of the parent company with annual revenues to the tune of $32 billion, including popular brands such as Oreo cookies, Trident gum and Cadbury chocolates. Kraft Foods Group manages operations in North America with annual revenues of around $18 billion.

From: http://www.forbes.com/sites/greatspeculations/2013/04/18/kraft-foods-group-looks-tasty-to-55/

"Oh Yeah!" Kraft's Kool-Aid Man Gets A Makeover And Facebook Friends

By Alex Konrad, Forbes Staff

V12 Fiat 500

In his decades as the face of Kool-Aid, the Kool-Aid Man has been known primarily for bursting through walls to offer up his namesake beverage with an “Oh yeah!” catch phrase. On Monday, Kraft Foods gave their brand “spokespitcher” a tech-savvy new look, introducing him to a 2013 world of Facebook, Twitter and Instagram.

From: http://www.forbes.com/sites/alexkonrad/2013/04/15/oh-yeah-krafts-kool-aid-man-gets-a-makeover-and-facebook-friends/

How Hormel Keeps Serving Up Strong Dividends

By Dan Caplinger, The Motley Fool

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Investors have always been interested in stocks that pay dividends, but lately, low interest rates on bonds and other fixed-income investments have made solid dividend payers even more valuable. Among the most promising dividend stocks in the market is Hormel Foods , and one big reason is that it is one of the few exclusive companies to make the list of Dividend Aristocrats.

In order to become a member of this elite group, a company must have raised its dividend payouts to shareholders every single year for at least a quarter-century. Only a few dozen stocks manage to make the cut, and those that do tend to stay there for a long time.

Hormel is famous for Spam, but it offers a full line of meat and other food products, ranging from Chi-Chi’s salsa and tortillas to Dinty Moore beef stew. Like many consumer-oriented businesses, Hormel has built up a reliable customer base that gives it a dependable and predictable flow of cash that it can then funnel out to shareholders. Let’s take a closer look at Hormel to see whether it can sustain its long streak of rewarding dividend payouts to investors.

Dividend Stats on Hormel

 

 

Current Quarterly Dividend Per Share

$0.17

Current Yield

1.7%

Number of Consecutive Years With Dividend Increases

47 years

Payout Ratio

33%

Last Increase

January 2013

Source: Yahoo! Finance. Last increase refers to ex-dividend date.

What’s happening at Hormel?
Hormel has done a good job of handling the challenges it has faced recently. Despite pressures from high feed costs resulting from last summer’s drought, its most recent quarterly results included a 1% gain in net income on a 4% increase in revenue. Moreover, the company boosted its full-year guidance by $0.03 per share, citing improving margins in its pork segment and continued strong performance from its Grocery Products division. Even though grocery products represent a small piece of Hormel’s business, it’s becoming increasingly important, as the recent split of Kraft Foods has created more urgency among competitors like Hormel to defend their turf and seek ways to expand.

Along those lines, the biggest recent news from Hormel came at the beginning of the year, when it announced it would buy the Skippy peanut butter brand from Unilever for $700 million. Somewhat surprisingly, Skippy is a major player not just in the U.S. but in China as well, where it’s the No. 1 peanut butter brand. As a result, the deal helps bolster Hormel’s attempts to expand internationally, and investors have applauded it as the stock that has risen almost 30% in response.

But the key for Hormel remains pork, which still represents the bulk of its business. That industry has seen mixed results lately, as domestic pork consumption has been weak but exports have kept the business growing. Tyson Foods relies more on chicken than pork, but its pork

Source: FULL ARTICLE at DailyFinance

Will Kraft Foods Help You Retire Rich?

By Dan Caplinger, The Motley Fool

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Now more than ever, a comfortable retirement depends on secure, stable investments. Unfortunately, the right stocks for retirement won’t just fall into your lap. As part of an ongoing series, I’m looking today at 10 measures to show whether Kraft Foods makes a great retirement-oriented stock.

Kraft Foods is now a greatly diminished part of its former self, holding the slower-growing North American grocery business after Mondelez took the global snack-food segment in its spinoff. For Kraft, though, competitive pressures still persist as the company refocuses on its well-known grocery brands, including Jell-O, Oscar Mayer, Cool Whip, and its namesake Kraft products. Will the slimmed-down Kraft fare better in the industry? Let’s revisit how Kraft Foods does on our 10-point scale.

The right stocks for retirees
With decades to go before you need to tap your investments, you can take greater risks, weighing the chance of big losses against the potential for mind-blowing returns. But as retirement approaches, you no longer have the luxury of waiting out a downturn.

Sure, you still want good returns, but you also need to manage your risk and protect yourself against bear markets, which can maul your finances at the worst possible time. The right stocks combine both of these elements in a single investment.

When scrutinizing a stock, retirees should look for:

  • Size. Most retirees would rather not take a flyer on unproven businesses. Bigger companies may lack their smaller counterparts’ growth potential, but they do offer greater security.
  • Consistency. While many investors look for fast-growing companies, conservative investors want to see steady, consistent gains in revenue, free cash flow, and other key metrics. Slow growth won’t make headlines, but it will help prevent the kind of ugly surprises that suddenly torpedo a stock‘s share price.
  • Stock stability. Conservative retirement investors prefer investments that move less dramatically than typical stocks, and they particularly want to avoid big losses. These investments will give up some gains during bull markets, but they won’t fall as far or as fast during bear markets. Beta measures volatility, but we also want a track record of solid performance as well.
  • Valuation. No one can afford to pay too much for a stock, even if its prospects are good. Using normalized earnings multiples helps smooth out one-time effects, giving you a longer-term context.
  • Dividends. Most of all, retirees look for stocks that can provide income through dividends. Retirees want healthy payouts now and consistent dividend growth over time — as long as it doesn’t jeopardize the company’s financial health.

With those factors in mind, let’s take a closer look at Kraft Foods.

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Source: FULL ARTICLE at DailyFinance

Factor

What We Want to See

Actual

Pass or Fail?

Size

Market cap > $10 billion

$30.4 billion

Pass

Consistency

Revenue growth > 0% in at least four of five past years

3 years*

Fail

 

Free cash flow growth > 0% in at least four of past five years

As Global M&A Activities Bounce Back, So Does Evercore

By Zacks.com, Contributor

One of the most interesting debates I’ve heard lately about this market is whether or not the increase in M&A activity is bullish. The bearish Doug Kass says it’s not and the ever-eBULLient Jim Cramer says it is. I’m not sure who is right. But I’ll tell you what is right: putting money on the focused, experienced deal-makers at Evercore Partners (EVR). This “boutique” investment bank—I’ve always loved that phrase, like it’s a shop on Fifth Avenue for the 1% (which it is I guess)—was founded in 1996 by current Chairman Roger Altman, a veteran of Wall Street and Washington. Altman served as deputy secretary of the U.S. Treasury in the late 1970s and again in the ’90s and was head of M&A for Blackstone Group (BX) before launching his own firm on the premise that clients would be best served by an investment banking firm free of the conflicts of interest inherent to large, multi-product financial institutions. Kill the Traders and Other Distractions Altman believed that this pure advisory model, not distracted by proprietary trading and sell-side research, would serve clients the best and attract the most talented senior finance professionals to the firm. This is important because while M&A deals seem like quick cash grabs on the surface where big money simply has to make a deal that makes both sides richer, there is a lot more to Evercore’s business, including advising on divestitures, restructurings, specialized financings, public offerings, private placements and other strategic transactions. Special Offer: We asked some of the most successful investors in the country to name their #1 pick for 2013. Get details on their top 10 stocks in this free report, Forbes Top Stocks for 2013…10 to Buy Now. Though global M&A activity rebounded fairly strong in 2010 and 2011 after the financial crisis, Evercore was a slow starter. You can see from the Price & Consensus chart below that earnings estimates would start out rosy for each year 2010 through 2012, only to be taken down. And, of course, the stock price followed. But in late 2012, you can also see that story quickly began to change. Analyst consensus estimates made a dramatic turnaround on the heels of one of the company’s biggest deals ever, advising Kraft Foods on its $36 billion spin-off of Kraft Foods Group. And as corporate deal-making heated up in into the end of 2012, with average Wall Street deal premiums crossing 25%, profit projections for EVR got hotter too. In early December, they signed on to advise McMoRan Exploration in its interest to be acquired by Freeport-McMoRan Copper & Gold (FCX) for $3.2 billion. Evercore has now facilitated more than $1 trillion in transactions, including advising a special committee of Dell’s board of directors in the recent bid to take the company private. And one thing to remember about Evercore is that even if a deal doesn’t close, they still get paid advisory fees for their work. The firm also has a growing Investment Management Services division …read more
Source: FULL ARTICLE at Forbes Latest

The Cookie Crumbles: Can Mondelez Find Its Mojo?

By Jenna Goudreau, Forbes Staff

It’s a bright, warm February day in Boca Raton, Fla., but Irene Rosenfeld doesn’t look happy. At an industry conference one week after reporting disappointing fourth-quarter results, the chairman and CEO of Mondelez International, formerly Kraft Foods, is defending her new company under a barrage of questions from irritated financial analysts. One wants to know what’s really changed after the spinoff. Another barks: “You said you’re getting frustrated? Well, we’re getting frustrated, too.” Yet another wants to know why she didn’t disclose before the earnings release that the company was having execution issues in Brazil and Russia. Beneath her no-fuss cropped red haircut and chic white blazer, her mouth hardens into a thin, straight line. “I deeply regret it impacted my credibility with you, but I don’t know what else could have been done,” she says. “The long-term prospects are quite robust.” …read more
Source: FULL ARTICLE at Forbes Latest

Peter Blair Henry: How America Can Bounce Back From The Economic Crisis

By Dan Schawbel, Contributor

I spoke to Peter Blair Henry, who is the Dean of the Stern School of Business at NYU, about his new book “Turnaround: Third World Lessons for First World Growth”. Before taking this position in January 2010, he was the Konosuke Matsushita Professor of International Economics at Stanford, where he was a faculty scholar, the Associate Director of the Center for Global Business and the Economy at Stanford’s business school, and a Senior Fellow at the Stanford Institute for Economic Policy Research. He served as a member of the Obama transition team and is a member of the President’s Commission on White House Fellowships. He is also a board member at the National Bureau of Economic Research, a member of the Board of Directors of Kraft Foods, a nonresident Senior Fellow at the Brookings Institution, and a member of the Council on Foreign Relations. …read more
Source: FULL ARTICLE at Forbes Latest

Here's What a New Berkshire Director's 2,556%-Gainer Fund Has Been Buying

By Selena Maranjian, The Motley Fool

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Every quarter, many money managers have to disclose what they’ve bought and sold, via “13F” filings. Their latest moves can shine a bright light on smart stock picks.

Today let’s look at Eagle Capital Management, founded in 1988 by Ravenel Boykin Curry III. It has as a general partner Meryl Witmer, who was recently tapped to be a new director at Warren Buffett‘s company, Berkshire Hathaway . Value-oriented Eagle prides itself on its focused portfolio of only a few dozen stocks, as well as its consistency, and long time horizon. Since inception, it has gained 2,556%, versus 769% for the S&P 500.

The company’s reportable stock portfolio totaled $14.1 billion  in value as of Dec. 31.

Interesting developments
So what does Eagle Capital‘s latest quarterly 13F filing tell us? Here are a few interesting details,

The biggest new holdings are Kraft Foods Group and the SPDR S&P 500 ETF . Kraft was spun off last year from the Kraft Foods mothership, which then took on the moniker of Mondelez International . Kraft Foods now specializes in domestic groceries, including brands such as JELL-O, Oscar Mayer, and Planters, while Mondelez focuses on global snacks and beverages, including brands such as Oreo, Trident, Tang, and Cadbury. Kraft recently disappointed investors, with an earnings update featuring earnings down sharply as a result of pension and restructuring charges, among other things. Kraft faces many competitive threats, such as from private labels. On the plus side, it does offer a 4.1% dividend yield.

Among holdings in which Eagle Capital increased its stake was Mondelez, which recently posted slightly disappointing earnings. It has been hurt by weakness in Europe, but bulls have high hopes for operations in developing markets, where growth is often more rapid. It also boasts assets such as boffo brands with pricing power, though it’s also carrying a lot of debt.

Eagle Capital reduced its stake in lots of companies, including U.K.-based Vodafone . Bulls had already been excited about its Smart II low-cost, mass-market smartphone, and its entry into the promising mobile-payments market, as well as a new deal to provide mobile service in 30 nations. Adding to that are reports that Verizon might be interested in ending its wireless-based partnership with the company or perhaps merging with it. Vodafone is huge, with more than 400 million customers, and its stock recently yielded 3.8%.

Finally, Eagle Capital‘s biggest closed positions included Willis Group Holdings and Cimarex Energy . Other closed positions of interest include Motorola Solutions and Waste Management . Fortune magazine named Motorola Solutions as one of America’s Most Admired Companies, and it is earning some investors’ admiration, too, shrinking its debt and growing its free cash flow. It’s trading near a 52-week high and yields about 1.6%. It operates in the field of public safety equipment, and its government contracts business grew 12%  in 2012.

Waste Management, …read more
Source: FULL ARTICLE at DailyFinance

Mary Schapiro Nominated to GE Board of Directors

By Business Wirevia The Motley Fool

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Mary Schapiro Nominated to GE Board of Directors

FAIRFIELD, Conn.–(BUSINESS WIRE)– The Board of Directors of General Electric Company [NYSE: GE] has nominated Mary Schapiro, former chairman of the U.S. Securities and Exchange Commission (SEC), as a GE director. Schapiro will stand for election at GE‘s annual meeting of shareowners on April 24, 2013.

Mary Schapiro will bring valuable expertise to GE, particularly with her experience overseeing U.S. financial markets,” said GE Chairman and CEO Jeff Immelt. “Her understanding of corporate governance and financial regulation will be of great benefit to GE and its shareowners. I am pleased that we have nominated Mary to our board.”

Schapiro served as chairman of the SEC from January 2009 through December 2012. Prior to becoming SEC chairman, Schapiro served as chief executive officer of the Financial Industry Regulatory Authority (FINRA) from 2007 through 2008. She joined FINRA in 1996, serving as president of the National Association of Securities Dealers (NASD) Regulation from 1996 to 2002 and as vice chairman from 2002 to 2006, when she was named chairman.

Schapiro served as a commissioner of the SEC from December 1988 to October 1994, and left the SEC when appointed chairman of the CFTC, where she served until 1996.

Prior to her 2009 SEC appointment, Schapiro also served as a director and chair of the audit committee at Duke Energy, and as lead director and chair of the nominating and governance committee at Kraft Foods.

Schapiro is a graduate of Franklin & Marshall College and earned a law degree from George Washington University Law School.

About GE

GE (NYS: GE) works on things that matter. The best people and the best technologies taking on the toughest challenges. Finding solutions in energy, health and home, transportation and finance. Building, powering, moving and curing the world. Not just imagining. Doing. GE works. For more information, visit the company’s website at www.ge.com.

Media:
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Seth Martin
646-682-5602 (office)
203-572-3567 (cell)
seth.martin@ge.com

KEYWORDS:   United States  North America  Connecticut

INDUSTRY KEYWORDS:

The article Mary Schapiro Nominated to GE Board of Directors originally appeared on Fool.com.

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Source: FULL ARTICLE at DailyFinance

How Much Faster Could We Reach Dow Records on a Kraft Diet?

By Anders Bylund, The Motley Fool

UNH Total Return Price Chart

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The Dow Jones Industrial Average finally made it back to the summit. After sniffing around just below record levels all February long, the blue-chip index broke through to brand-new all-time highs today. The 14,164 high-water mark that was set in 2007 has been washed away.

The index made a significant change in recent months when Kraft Foods spun off its snack food operations as a stand-alone company named Mondelez . Dow component Kraft no longer had the heft to stay on the index, and squeezing Mondelez into an unprecedented 31st seat was an unthinkable break with tradition. So Kraft had to go, replaced by health insurance giant UnitedHealth Group .

What if the Dow board had decided to stick with the new, slimmer Kraft instead of bringing in fresh blood to replace it? UnitedHealth and Kraft have moved in completely opposite directions lately, with UnitedHealth falling while Kraft has outgained the Dow:

UNH Total Return Price data by YCharts.

Staying with Kraft would surely have accelerated the Dow’s rise to record heights. Champagne corks could have popped sooner. But how much sooner?

Not a whole lot, as it turns out.

Kraft shares have gained 8% on a dividend-adjusted basis since being dumped from the Dow. Meanwhile, UnitedHealth shares lost 4.3%. That means UnitedHealth slowed the Dow’s ascent down by 19 points, while Kraft would have added 44 points. With share prices in the neighborhood of $50, either stock represents about 3% of the Dow’s daily movements.

So it’s safe to say that the Dow would have topped record levels yesterday, rather than closing less than 40 points out of reach. Depending on the dynamics of mass psychology in the face of a long-awaited record, the Dow might have scaled the summit at various times last week as well.

Yes, Kraft would have taken us to all-time highs sooner, but not by much. On the flip side, UnitedHealth shouldn’t feel too guilty about slowing down the carousel of progress.

Kraft Foods Group is entering a new era after its recent corporate breakup. Its brand power is indisputable, and its market share dominates, but Kraft’s growth potential is limited, and its heavily commoditized categories face massive pressures. In The Motley Fool’s brand-new premium report on the company, we guide you through everything you need to know about Kraft, including the key opportunities and threats facing the company. To get started, simply click here now.

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Source: FULL ARTICLE at DailyFinance

Tom Ward Of Sandridge Energy: Another CEO That's Got To Go

By Richard Finger

Like another crosstown oil and gas exploration company based in Oklahoma City, Sandridge Energy (SD) is exhibiting the same shareholder inimical corporate governance practices. The good news is the abusive reign of Chesapeake Energy (CHK) king Aubrey McClendon last week came to an abrupt end. The bad news is that Sandridge founder and CEO Tom Ward (also a CHK co-founder) continues presiding unchecked as an autocrat. Like at CHK, Mr. Ward instituted his own analogue version of Aubrey?s Founders Well Participation Program (FWPP), the Sandridge Executive Well Participation Program (SEWPP). While Aubrey got to cherry pick and invest in a 2.5% interest in CHK wells, Mr. Ward felt even more generosity towards himself, upping his take to 3%. Like Aubrey in the past, Mr. Ward is obscenely overpaid. Mr. Ward presides over a sycophantic board that obsequiously bows to Caesars commands. Thanks in large part to the activism of Carl Icahn, Chesapeake, being free of Aubrey and most of his cabal of board members now has a chance to ?right the ship? and create value for shareholders. Now come along hedge fund TPG Axon and CEO Dinakar Singh. Mr. Singh?s hedge fund has acquired a 6.7% stake in the common shares of Sandridge and has undertaken a ?consent solicitation? to replace the entire Sandridge board and the subsequent ouster of Mr. Ward. Sandridge laughably claims the TPG Axon director slate lacks requisite energy experience. Each of the seven potential directors have held high positions at companies like BP, El Paso Eastern Pipeline, Oryx Energy or currently serve on boards of major NYSE companies such as Kraft Foods and AOL. The only commonality of current Sandridge board of directors is a blind obeisance to a CEO who compensates each one around $375,000 annually or for perspective, $80 to $90,000 more than is received by directors of integrated giant Exxon-Mobil, a company over 130 times its market capitalization. Put another way, in just a little more than every two days, Exxon takes in more in revenue than the entire market cap of Sandridge. …read more
Source: FULL ARTICLE at Forbes Markets