Bull’s Eye: Post Holdings (POST)

Packaged foods stocks are looking very strong

   

At StateoftheMarkets.com, we strive to “own the best and ignore the rest” in our equity portfolios. Toward this end, each day we search our database for a “top stock” (a top rated company in terms of earnings strength as well as company and industry performance) that presents a strong technical “set up” and a good entry point.

In short, when our equity team is looking to add a stock to one of our portfolios, the “bull’s eye” stock shown below is generally their first choice.

Company Symbol Industry Stock Rating YTD% Gain S.T. Stop Loss
Post Holdings Inc POST Packaged Foods & Meats 7.2 +23.59% $43.20

Why We Like The Stock:

Post Holdings (POST) is our most compelling buy today due to the fact that it is a top rated stock (in terms of earnings strength and company/industry performance) with a positive technical set-up. 2013 has been kind to the packaged foods space, as evidenced in big gainers like Dean Foods (DF), B&G Foods (BGS), Sanderson Farms (SAFM), and POST. We like POST in particular among these stocks for its strong long- and intermediate-term uptrend, as well as its prospects in the short-term.

Recently, the stock traded as high as $47.13 in mid-June before pulling back and basing around $44. Currently, the stock has just crossed above all of its major short-term moving averages and is back on the upswing. POST has support at $44, and again at $42, which makes it a relatively safe bet moving forward. We like the stock at current prices for a run back to its $47.13 resistance, though if it failed to break out there, we would sell and take the +5% gain.

We Would Be Buyers:

At the current price (~$44.92).

Company Profile:

Post Holdings, Inc., is a holding company. The company is a manufacturer, marketer and distributor of branded ready-to-eat cereals in the United States and Canada. The company’s portfolio of brands includes Honey Bunches of Oats, Pebbles, Great Grains, Grape-Nuts, Shredded Wheat, Raisin Bran, Golden Crisp, Alpha-Bits and Honeycomb. In May 2013, Post Holdings Inc. completed the previously announced acquisition of the branded and private label cereal, granola and snacks business of Hearthside Food Solutions, a portfolio company of Wind Point Partners.

Stock Rating: 7.2

The Stock Rating indicates the combined score of our proprietary Earning Strength and Company Performance models. The rating scale is 0 – 10 with 10 being the highest.

Post Holdings – Last Three Months

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Post Holdings – Last 12 Months

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Post Holdings – Last Five Years

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At the time of publication the editor and affiliated companies own the following positions: None

Note: Positions may be bought or sold while this publication is in circulation without notice.


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