Food Plays: Supermarket Stocks

Andrew Fisher

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."

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Auxier owns Tesco, Kroger and Safeway through his fund.