Smithfield Foods: Half-Off Sale Presents Buy Opportunity - Mark Krieger

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Smithfield Foods: Half-Off Sale Presents Buy Opportunity
Jul 02, 2008 02:47 PM UTC

Mark Krieger

Return	Risk
-2.56%	MID

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Symbol	Sentiment	Start	Return	Closed
SFD		07/02/08	-8.06%	--

Via Long Investment Ideas from Seeking Alpha:

Smithfield Foods (SFD) has seen its shares trimmed nearly 50% in just the past four weeks. The main culprit: soaring feed corn costs trimmed Q4 earnings by 94%. A series of events then unfolded to systematically destroy the share price:

(1) S&P downgraded SFD's debt ratings
(2) D.A. Davidson cut its opinion from neutral to under-perform
(3) COFCO, China's largest pork producer announced its intention to purchase a 5% stake
(4) SFD announced a plan to raise $350 million through the sale of senior notes.

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