The market's negative reaction to Fresh Del Monte Produce's stock may be due to a disconnect between EPS growth and falling share price, or previous over-optimism. The company's revenue drop is seen as mediocre, but if the market expected consistent top line growth, this could explain the share price weakness.
Insider sale of Fresh Del Monte Produce shares over the past year raises concerns. Their lack of recent insider buying despite significant ownership doesn't inspire confidence.
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$Dole plc (DOLE.US)$$Fresh Del Monte Produce (FDP.US)$I will state some reasons why I think DOLE should trade at a minimum of $20/ share right now. It currently trades at $13.8. The new company formed after the combination of Total Produce and DOLE will be the largest fresh produce company by revenue. DOLE PLC ($9.0 BN) GREENYARD ($5.2 BN) FRESH DEL MONTE ($4.2 BN) These companies are completely recession proof and can only suffer with short term raw material price increases, as they can't rise prices at the same rate. In Dole's case, the vertically integrated business model allows them to prevent some of these issues. DOLE owns 16 vessels and more than 160 facilities around the world. This is an industry with many barriers of entry, which makes it very difficult for new competitors to increase their respective market share. Companies such as these historically trade at 15x earnings. However, DOLE trades at just 9-10x earnings given the current EPS estimate of $1.39 for 2021. I believe a company of DOLE's quality should be trading between 14 and 18 times earnings.
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it already trading 22times PE at its current price. yet to dole out any dividend yet.
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Fresh Del Monte Produce Stock Discussion
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The new company formed after the combination of Total Produce and DOLE will be the largest fresh produce company by revenue.
DOLE PLC ($9.0 BN)
GREENYARD ($5.2 BN)
FRESH DEL MONTE ($4.2 BN)
These companies are completely recession proof and can only suffer with short term raw material price increases, as they can't rise prices at the same rate.
In Dole's case, the vertically integrated business model allows them to prevent some of these issues.
DOLE owns 16 vessels and more than 160 facilities around the world.
This is an industry with many barriers of entry, which makes it very difficult for new competitors to increase their respective market share.
Companies such as these historically trade at 15x earnings. However, DOLE trades at just 9-10x earnings given the current EPS estimate of $1.39 for 2021.
I believe a company of DOLE's quality should be trading between 14 and 18 times earnings.
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