CNBC’s Jim Cramer on Friday named packaged meals shares that is perhaps good additions to portfolios, particularly if the financial system is headed for a slowdown. Although they weren’t good, he was inspired by earnings this week from Campbell Soup and J.M. Smucker.
“We’ve had enough signs of weakness that it might be a good idea to own some recession stocks — the stocks of companies that make the same money in good times and bad because their products are essential,” he stated. “For example, the packaged food plays.”
Cramer stated he thinks Campbell Soup and J.M. Smucker each advised “compelling” tales this week, however that he prefers the previous. In keeping with Cramer, Campbell Soup reported stable earnings however weaker steerage, due partly to its expensive acquisition of pasta sauce maker Sovos Manufacturers. He prompt the acquisition can pay for itself over time and was inspired that the corporate appears to be rising gross sales with out elevating its costs.
J.M. Smucker’s gross sales had been softer than anticipated, however Cramer was heartened that the corporate managed to tug off a sizeable earnings beat. He additionally famous that J.M. Smucker’s manufacturers had been rising properly, like Uncrustables sandwiches and pet meals, however stated it wants to enhance its espresso enterprise.
He confused that the entire packaged meals group often does properly in a slowdown and prompt additionally trying into Tyson Meals, Hormel, Common Mills, Conagra and Kellanova.
“Ultimately, I feel incrementally more positive on the packaged food space after hearing from Campbell’s and Smucker,” he Cramer stated. “For those two stocks specifically, I do prefer Campbell’s … but Smucker still has a good value proposition.”
J.M. Smucker and Campbell Soup didn’t instantly reply to a request for remark.
