Food Plays: Supermarket Stocks
Shopping for promising stocks? Where better than at the supermarket? Jeff Auxier of Auxier Asset Management has some tasty food-business selections for investors.
His Auxier Focus Fund is up an average of 10.5 percent per year over the last five years.
Auxier's list begins with British-based Tesco. "Tesco's probably the best-run supermarket chain in the world," he said.
"They're heavily levered into Eastern Europe and China, and they really out-compete all the other supermarkets in the world, including Wal-Mart."
He also likes Kroger.
"They've done a really good job competing, sticking to their knitting, keeping their costs down," he said. "They've got a very low cost structure, and...there's this trend toward private label and dining in; they're really adding to market share right now."
Also on his list is Safeway, another passenger on the private-label bandwagon.
"That's very profitable for these grocers,' he said. "[Safeway has] double-dight earnings and sales growth."
Auxier owns Tesco, Kroger and Safeway through his fund.