|One box contains 12 of these bad boys and within a day all 12 are gone.|
On Friday, November 17, 2017, I received a phone call from my boss at Walmart asking if I could do an 8 hour night shift since the frozen foods guy had to take emergency leave. Now warn you I just worked a 14 hour shift at my main job and I appropriately stated "no" to which he responded "I'll pay you overtime since you already worked 40 hours." Without thinking rationally the mere words of overtime forced my compliance.
Stocking the frozen meals section I started pondering. How could I build a grocery store from the ground up using the stocks I currently possess?
Real estate + land: WMT
General goods/dry food: GIS, HRL, CPB
Bread: FLO, CPB
Snacks: HRL, CPB, TSN, GIS
Breakfast foods: TSN
ready to eat meals/deli foods: HRL, TSN
frozen snacks: GIS
Frozen meals: _________
After researching I found the two major players in the frozen meals section; Nestle and Conagra. Your biggest question is why would I buy Conagra Foods over a super giant like Nestle? Nestle has grown revenue and net income by cutting cost and selling off product lines that didn't produce results. Even now they are in the process of looking for someone to buy their US confectioner brands.
What is Conagra doing? They are trimming off brands that failed to produce a profit. They reorganized their frozen meals to focus on quality over volume. instead of one dollar banquet meals they are now offering three to four dollar meals focusing on offering healthier choices and bigger portions. Conagra is currently in the process of releasing new innovative products for the modern world like non-lactose reddi whip made from almond milk.
But the main reason I decided to buy Conagra was for the CEO. People like their Bezos and Musk, but I love me some Connolly. Recently at Conagra webcast an interesting question was asked. Here's the link How will Conagra compete in a world rejecting brands for private labels? His response? The public is not rejecting brands, it's the brands that are rejecting the public. In other words, brands refuse to innovate for the modern american which left a huge void. Private companies saw the opportunity and jump into the void. How can brands complain of private companies when they themselves don't compete in that area? Accordingly, he argues that brands lack the same weight to the modern generation compared to its historic customers. Modern Americans are willing to pay five dollar for a cup of coffee, but nowhere is anyone offering a full healthy fulfilling meal for that price. Connolly goes on to explain how companies are failing to capture millennials unstable dining schedules (referring to Millennials deciding what they will eat for dinner only a few hours before they actually eat). That Millennials tend to be on a tighter budget and buying fresh organic foods only to see them rot is creating a gap that Conagra frozen meals is trying to capture.
Any avid dividend investor in the food sector should listen to this conference. It's only 45 minutes long and captures everything wrong with the current food companies. Listen on your way to work or before bed to help you sleep at night. All I have to say is buying ConAgra added a bit of spice to my portfolio. A wise man once told me that investing in the market requires more than spreadsheets and analyst opinions. A true investor can stand on his own two legs and with conviction state that X company will grow and make me more money. If you don't have that conviction then you shouldn't be investing in that company.
As of right now ConAgra is my greatest conviction in the market and I will continue to use my walmart money to buy it until I reach 100 shares.