1. Albertsons Companies, Inc. (NYSE:ACI)
Number of Hedge Funds Holders: 59
Next stock in the list of 7 best beef stocks is Albertsons Companies, Inc. (NYSE:ACI) which operates food and drug stores across the United States. It also manufactures and processes food products, including beef steaks, beef whole cuts, and ground beef. Notable brands in the product portfolio include Albertsons, Safeway, and Tom Thumb.
In July 2024, the company expanded its beef offerings by bringing in Godshall’s beef bacon in its California, Colorado, and Southwest stores. This aligns with the Albertsons’ strategy to offer a wide range of high-quality meats. In addition to beef bacon, it has also brought in Godshall’s turkey bacon, which offers a healthier alternative to pork bacon.
Albertsons Companies, Inc. (NYSE:ACI) generated $24.3 billion in revenue in the first quarter of 2024. This represents an increase from $24.1 billion on a YoY basis. The increase was primarily driven by the company’s 1.4% increase in identical sales. Higher pharmacy sales contributed to the growth in identical sales. The company also reported a 23% growth in digital sales during the first quarter.
With increased sales, the gross profit margin rose to 27.8%. However, the selling and administrative expenses also increased to 25.9% of net sales during the first quarter. This increase was due to higher operating expenses for the ongoing development of digital and omnichannel capabilities, third-party security services, and increased store occupancy costs. This was partially offset by the benefits of productivity initiatives.
Interest expenses fell to $145.7 million in the first quarter of fiscal 2024, down from $154.9 in the same period of fiscal 2023. This decrease was due to reduced average outstanding borrowings. Therefore, Albertsons Companies, Inc. (NYSE:ACI) was able to earn a quarterly net income of $391.6 million.
The company announced a merger plan with The Kroger Co. in early 2024. According to the plan, Kroger Company will acquire all outstanding shares of Albertsons. The merger is now facing trial due to concerns about its impact on competition in the grocery industry. Thus, investors should watch closely to see if the deal gets finalized or falls through.
Nevertheless, 59 hedge funds have invested $4.2 billion in Albertsons Companies, Inc. (NYSE:ACI) as of Insider Monkey’s database of Q2 2024. Also, the stock carries an upside potential of 31%, according to six analysts’ predictions.
Overall, Albertsons Companies, Inc. (NYSE:ACI) ranks first on our list. While we acknowledge the potential for ACI to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than NVDA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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