Snack on Inventure Foods

06/10/2014 7:00 am EST


James Oberweis

President, Oberweis Asset Management, Inc.

This featured recommendation is a leading marketer and manufacturer of healthy/natural and indulgent specialty snack food brands, explains small-cap expert Jim Oberweis, Jr., editor of The Oberweis Report.

Inventure Foods, Inc. (SNAK) operates two segments: frozen products and snack products. The frozen products segment produces frozen fruits, vegetables, and beverages for sale primarily to groceries, club stores, and mass merchandisers.

The snack products segment produces potato chips, kettle chips, potato crisps, potato skins, pellet snacks, sheeted dough products, and extruded products for sale primarily to snack food distributors and retailers.

In the healthy/natural food category, products include Rader Farms' frozen berries, Boulder Canyon Natural Foods brand kettle cooked potato chips, Willamette Valley Fruit Company (acquired in May 2013), and Fresh Frozen (acquired in November 2013) frozen fruits and vegetables.

In the indulgent specialty snack food category, products include T.G.I. Friday's brand snacks, Nathan's Famous, Vidalia, Poore Brothers' Bob's Texas Style and Tato Skins. Inventure has multiple facilities that grow, process, and freeze millions of pounds of fruits and vegetables annually.

The company is currently increasing its individually quick frozen capacity by 30% to 40%, which we believe will increase gross margins later in 2014.

In the company's latest reported first quarter, sales increased approximately 39% to $67.5 million from $48.5 million in the first quarter of last year.

Inventure Foods reported earnings per share of $.08 in the latest reported first quarter versus $.05 in the same quarter of last year.

Clients of Oberweis Asset Management own approximately 87,000 shares. These shares may be appropriate for risk-oriented investors.

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