Del Monte Foods may have jumped 7% on Thursday after reporting a strong fourth quarter, but Cramer thinks the stock is still cheap.
He recommended DLM back on March 9 as part of his call on the mini-bull market in all things pet related, and it’s up 10% since then. The S&P 500, however, is down 5% in the same period. Today, on top of beating the Street’s earnings estimates, also upped its dividend a full 80% and announced a big stock buyback.
Of course, the quarter wasn’t perfect, with sales falling short of analysts’ expectations. But Cramer said that was offset by productivity savings and lower input costs, as well as strength in the pets business. Sales of new products looked bullish, too.
Either way, Cramer thinks DLM, trading at 11 times next year’s earnings and a 10.6% long-term growth rate is a steal. To get a closer look at the company, he invited Chairman, CEO and President Richard Wolford onto the show. Watch the video for the full interview.
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