Conagra Brands: Slim Jim to Chef Boyardee

04/09/2019 5:00 am EST

Focus: COMMODITIES

Vita Nelson

Founding Publisher and Editor, Moneypaper

Conagra Brands, Inc. (CAG) sells branded and customized food products, as well as commercially branded foods. It also supplies vegetable, spice and grain products to a range of restaurants, foodservice operators and commercial customers, suggests dividend expert Vita Nelson, editor of DirectInvesting.

Its brands include Marie Callender's, Healthy Choice, Slim Jim, Hebrew National, Orville Redenbacher's, Peter Pan, Reddi-Wip, PAM, Snack Pack, Banquet, Chef Boyardee, Egg Beaters, Rosarita, Fleischmann's and Hunt's.

CAG is considered a defensive stock, because it provides a constant dividend and stable earnings, regardless of the state of the overall stock market, because of the constant demand for its products.

s a defensive stock, it tends to remain stable during the various phases of the business cycle and tends to perform better than the broader market during recessions. Its current total market capitalization of $13.3 billion makes

CAG a large capitalization stock with a long history of consistent dividend payments and revenues and earnings growth. It is considered a diversified business with a durable competitive advantage over its rivals that enjoys solid management and corporate culture.

According to Yahoo! Finance, consensus estimates call for the company to earn about $2.05 per share this year, and to go to about $2.17 per share next year.

The company has paid dividends to investors since 1976, and during the past thirty years has increased the dividends from 4 cents per share quarterly in the year 1989, to 21 cents per share quarterly today. Its current trailing 12-month dividend yield is 3.21%.

Technically, CAG also looks attractive, after clearing a three-month price consolidation pattern with above-average volume. Despite the price breakout, the stock is still trading 30.8% below its 52 weeks high.

With the stock being fundamental and technically attractive, this company is an appropriate holding for investors who wish to build a holding over the long term. 

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