The New Amazon Whole Foods Monster Means You Should Avoid Organic Food Stock – TheStreet.com

Posted: September 4, 2017 at 8:43 pm


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As geopolitical tensions with North Korearise, shares of Hain Celestial Group, Inc. (HAIN) are all over the place. First up 1.6%, to $41.25, now down 0.12% Tuesday. Shares are off their early morning highs, though, opening near $43 after the company beat on earnings per share and revenue expectations.

Hain stock had been on a tear, but accounting issues derailed the stock over the last few years. Those issues are in the past and Hain is now doing OK, TheStreet's founder Jim Cramer, who also manages the Action Alerts PLUS charitable trust portfolio, said on CNBC's "Mad Dash" segment.

The big concern is Whole Foods Market (WFM) . The natural and organic food trend is still very much alive, which plays right into Whole Foods' wheelhouse. However, now that Amazon.com, Inc. (AMZN) is running Whole Foods, there are questions as to what role Hain will play and whether it will lose pricing power as a result.

Taking a broader look at consumer packaged food companies and retailers in general, Cramer pointed out that their "dividend is not protecting [them] anymore."

Expanding on that thought, he explained that investors are so unsure of the operating environment and what disruptions Amazon may introduce -- which can also be a negative for Amazon -- that the dividend yield is no longer enticing enough. Even though many of these dividend yields continue to rise, investors aren't taking the bait.

Getting back to Hain, the company is doing OK, but there are a few question marks remaining, Cramer concluded.

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The New Amazon Whole Foods Monster Means You Should Avoid Organic Food Stock - TheStreet.com

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Written by grays |

September 4th, 2017 at 8:43 pm

Posted in Organic Food