In this article, we discuss the 5 best food stocks to buy now. If you want to read our detailed analysis of the food stocks and the overall industry, go directly to see the 10 Best Food Stocks To Buy Now.
5. Tyson Foods, Inc. (NYSE:TSN)
Number of Hedge Fund Holders: 33
Tyson Foods, Inc. (NYSE:TSN) is an American food company that is one of the largest producers of chicken, beef, and pork and is also the largest exporter of beef in the country. The stock gained on November 14, after it topped consensus estimates for its fiscal Q4 earnings, making it one of the best food stocks to buy now. Tyson Foods, Inc. (NYSE:TSN) posted an EPS of $2.30, beating the estimates by $0.08.
At the end of June, 33 hedge funds tracked by Insider Monkey reported owning stakes in Tyson Foods, Inc. (NYSE:TSN), valued at $743.7 million. In the previous quarter, 28 hedge funds had positions in the company, highlighting a positive hedge fund sentiment in Q2.
On November 16, both BMO Capital and Stephens raised their price targets on Tyson Foods, Inc. (NYSE:TSN) to $103 and $100, respectively, after the company posted strong quarterly results. The analysts appreciated a 15.4% year-over-year growth in the company’s beef sales in fiscal Q4 2021.
4. The Kraft Heinz Company (NASDAQ:KHC)
Number of Hedge Fund Holders: 33
The Kraft Heinz Company (NASDAQ:KHC) reported Q3 earnings on October 27 and posted an EPS of $0.65, beating the estimates by $0.07. The company’s revenue for the quarter stood at $6.32 billion, beating the consensus by $240 million. With a surprising 2% q/q growth in organic sales, The Kraft Heinz Company (NASDAQ:KHC) remains one of the best food stocks to buy now.
Recently, The Kraft Heinz Company (NASDAQ:KHC) announced a quarterly dividend of $0.40 per share. The stock’s dividend yield stands at 4.39%. The company’s dividend payout ratio stands at 55.56%. In September, Morgan Stanley resumed its coverage on The Kraft Heinz Company (NASDAQ:KHC) with an Equal Weight rating and a $37 price target.
At the end of Q2 2021, 33 hedge funds tracked by Insider Monkey reported owning stakes in The Kraft Heinz Company (NASDAQ:KHC), the same as in the previous quarter. These stakes are valued at over $13.5 billion. Warren Buffett’s Berkshire Hathaway is the largest shareholder of The Kraft Heinz Company (NASDAQ:KHC) in Q3, owning shares worth roughly $12 billion.
3. General Mills, Inc. (NYSE:GIS)
Number of Hedge Fund Holders: 37
General Mills, Inc. (NYSE:GIS) is an American multinational food company that sells food and related products through retail stores. As of Q2, Insider Monkey’s data shows that hedge fund interest is increasing in General Mills, Inc. (NYSE:GIS) as 37 hedge funds tracked by Insider Monkey remained bullish on the company, up from 31 in the previous quarter. The total worth of these stakes is roughly $745 million.
In fiscal Q1, General Mills, Inc. (NYSE:GIS) posted an EPS of $0.99, beating the estimates by $0.10. The company’s revenue for the quarter stood at $4.54 billion, up 4.5% from the prior-year quarter.
Recently, Citigroup lifted its price target on General Mills, Inc. (NYSE:GIS) to $70, while upgrading the stock to Buy. The firm’s analyst appreciated the company’s position in the market.
Oakmark Funds mentioned General Mills, Inc. (NYSE:GIS) in its Q3 2021 investor letter. Here is what the firm has to say:
“In the 1970s, blackout rules prevented televising NFL home games that weren’t sold out. It was always uncertain whether or not the Minnesota Vikings’ games would be televised. I remember how excited I’d be each week hearing that General Mills had purchased the remaining tickets, allowing the game to be on TV. Some said General Mills did this for its stakeholders—its employees and community—as opposed to maximizing profits for its shareholders. I believe stakeholders and shareholders both benefitted.
Consider the long-term benefits of General Mills being the hero that let us watch those games. It made employees proud of their employer and maybe helped with talent acquisition. The thousands of disadvantaged kids who got to attend NFL games were perhaps more likely to become General Mills customers or employees. And across the state, maybe we were all more likely to buy Betty Crocker cake mix instead of Duncan Hines. While the tickets were purchased in the name of being a good corporate citizen, I believe it was the most effective marketing ever done by General Mills and clearly benefitted the company’s shareholders.
Would Friedman argue against this spending because it reduced profits? Absolutely not. His writing from more than 40 years ago sounds eerily timely: “In the present climate of opinion, with its widespread aversion to ‘capitalism,’ ‘profits,’ the ‘soulless corporation’ and so on, this is one way for a corporation to generate goodwill as a by-product of expenditures that are entirely justified in its own self-interest.”
General Mills accepted lower short-term profits in its pursuit of higher long-term value. And the stakeholders also benefitted. In The Heart of Capitalism, Joly states that “shareholder or stakeholder” tradeoffs are artificial because an “and” solution often exists. “We maximize performance not by choosing between stakeholders, but by embracing all of them. We choose employees and customers and shareholders and the community.” Joly cites examples from his time at Best Buy, including reducing its carbon footprint by installing LED lights throughout the stores. “This helps the environment and helped us save money on our energy consumption. Again, not a zero-sum game.”
2. Mondelez International, Inc. (NASDAQ:MDLZ)
Number of Hedge Fund Holders: 53
Mondelez International, Inc. (NASDAQ:MDLZ) is an American confectionery and food holding company, based in Chicago, U.S. Mondelez International, Inc. (NASDAQ:MDLZ) announced its Q3 earnings on November 2. The company posted an EPS of $0.71, beating the estimates by $0.01. Its revenue for the quarter grew by 7.6% from the same period last year, at $7.18 billion.
This September, Morgan Stanley initiated its coverage on Mondelez International, Inc. (NASDAQ:MDLZ) with an Overweight rating and a $69 price target, as the company expects growth in its long-term organic sales. Moreover, the firm believes that the company has strong pricing power and is leveraged to a post-Covid recovery, which makes it one of the best food stocks to buy now.
At the end of Q2, 53 hedge funds tracked by Insider Monkey reported owning stakes in Mondelez International, Inc. (NASDAQ:MDLZ), valued at roughly $3 billion. In the previous quarter, 45 hedge funds had stakes in the company, worth $2.8 billion, which highlights a positive hedge fund sentiment in Q2. Ric Dillon’s Diamond Hill Capital is the largest shareholder of Mondelez International, Inc. (NASDAQ:MDLZ) in Q3, owning roughly 10 million shares.
1. PepsiCo, Inc. (NASDAQ:PEP)
Number of Hedge Fund Holders: 66
PepsiCo, Inc. (NASDAQ:PEP) is an American food, beverage, and snack company. Recently, Barclays raised its price target on PepsiCo, Inc. (NASDAQ:PEP) to $168, with an Overweight rating on the shares, after the company posted solid Q3 earnings and provided next year’s outlook.
Recently, PepsiCo, Inc. (NASDAQ:PEP) announced to receive delivery of its first batch of Tesla Semi Trucks by the end of the year as a part of its broader plan to cut transportation emissions. In Q3, the company posted an EPS of $1.79, beating the estimates by $0.06. PepsiCo, Inc. (NASDAQ:PEP) saw a 9% growth in its organic revenue in the third quarter.
Of the 873 hedge funds tracked by Insider Monkey, 66 hedge funds had stakes in PepsiCo, Inc. (NASDAQ:PEP) in Q2, up from 61 in the previous quarter. The total value of these stakes is over $5 billion, compared with $4.8 billion in Q1 2021. Fundsmith LLP is the company’s largest shareholder in Q3, owning shares worth $1.5 billion.
You can also take a look at Top 10 Food Delivery Stocks to Buy in 2021 and 10 Biggest Fast Food Chains in the World
