Value Investing with Sven Carlin, Ph.D. on $SJM (Nov 3, 2026)
SJM is cheap for a good reason: high debt, declining business and low net sales mean it would need a miracle to hit its long-term growth goals, and its acquisition attempts don't fix that. The speaker sees risks, no catalyst and unattractive risk-reward, and says the market's opinion is correct.
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J.M. Smucker, or how do I pronounce it? Food companies have high debt levels . These people need a miracle to do anything more than they are doing now. Therefore, a continuous recession for the past ten years.
They usually resort again to crazy acquisition deals, trying to manage those cash flows, but they have declining business and low net sales . Yes, long-term goals are for growth, but you need a miracle to achieve that growth.
Therefore, these food companies are cheap for a good reason. I don't see positive aspects, I see risks. Anything is possible. These companies are cheaply priced when you look at their fundamentals, but they are unattractive from a risk-reward perspective.
As a value investor, you are looking for a catalyst, for hidden value, and for something you can rely on regardless of what the market thinks. In this case, the market's opinion is correct.