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Yahoo
14-05-2025
- Business
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The J. M. Smucker Company (SJM): Among the Best Dividend Growth Stocks with High Yields
We recently published a list of the . In this article, we are going to take a look at where The J. M. Smucker Company (NYSE:SJM) stands against other best dividend growth stocks. Dividend-paying stocks have been gaining popularity among investors due to their long-term advantages. According to Jeremy Zirin, who leads the US equity team for private clients at UBS Asset Management, companies with a consistent track record of increasing dividends are a smart choice for investors seeking a balanced approach in the current market environment. When markets dipped in April after President Donald Trump announced new tariff policies, investors gravitated toward high-yield dividend stocks. However, as trade tensions began to ease and negotiations progressed, markets recovered. Stocks surged particularly after the US and China agreed to temporarily reduce tariffs. He made the following comment about dividend stocks: 'The higher-dividend-yielding strategies tend to do better when markets are in real turmoil and declining, but if there's more chop, more volatility and potentially upside … you don't want to be overly defensive.' Historically, companies that consistently increase their dividends have tended to be less volatile and often delivered stronger returns than the broader market, including benchmarks like the S&P Equal Weight Index. According to a report by Guggenheim, from May 2005 through December 2024, firms that either initiated or raised their dividends generated an average annual return of 10.5%. In contrast, companies that cut or suspended their payouts posted just 5.5% annually. The overall market returned 10.4% during this timeframe, slightly behind the dividend growers. The report also highlighted that dividend growth strategies have historically performed well in both rising and falling markets, making them an attractive option for investors focused on long-term gains and downside protection. According to a report by S&P Global, the growth of global dividend payments had been slowing since the post-COVID recovery, but that trend reversed last year. In 2024, the growth rate unexpectedly accelerated to 8%, with shareholders receiving approximately $180 billion more than the previous year. This increase came as a surprise given the persistent geopolitical and economic challenges. The report also highlighted that several sectors and regions saw record dividend initiations, including the US technology, media, and telecom (TMT) sector, banks in Italy and Spain, Japan's automotive industry, and a general rise in payouts from Mainland China. Even with extreme price fluctuations, dividend payments from the oil and gas sector remained strong. Looking ahead, the report suggested that this high level of dividends is likely to hold steady, with global payouts expected to remain at $2.3 trillion in 2025. With growing investor appetite for dividend-paying stocks, many companies have responded by gradually increasing their dividend payouts. A report by Janus Henderson revealed that global dividend payments reached a record $1.75 trillion in 2024, reflecting a 6.6% rise on an underlying basis. The overall growth rate came in at 5.2%, slightly held back by a drop in special one-time dividends and the effect of a stronger U.S. dollar. Out of the 49 countries covered in the report, 17—including major economies such as the US, Canada, France, Japan, and China—posted record-high dividend levels. In total, 88% of companies either raised or held their dividends steady over the year. A wholesaler distributing peanut butter, fruit spreads and specialty spreads to a retailer. For this list, we screened for dividend stocks with yields higher than 3% as of May 13. From this group, we further refined our selection criteria by identifying stocks with a dividend growth streak of 10 years or more. The stocks are ranked in ascending order of their dividend yields. At Insider Monkey, we are obsessed with hedge funds. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter's strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (). Dividend Yield as of May 13: 3.87% The J. M. Smucker Company (NYSE:SJM) is an American food company, headquartered in Ohio. The company manufactures a wide range of food and beverage products. In its recent quarterly update, the company emphasized the importance of its procurement strategies amid rising commodity prices, especially green coffee, to help safeguard margins. The company also pointed to one-time factors, such as trademark impairments and supply chain disruptions, that negatively affected its overall operating performance and contributed to mixed results. For fiscal Q3 2025, The J. M. Smucker Company (NYSE:SJM) reported $2.2 billion in revenue, a 2% year-over-year decline. It posted a net loss of $6.22 per diluted share, mainly due to noncash impairment charges tied to its Sweet Baked Snacks business. However, on an adjusted basis, earnings per share rose 5% to $2.61. Gross profit increased by $55 million, or 7%, thanks to improved pricing, cost efficiencies, and benefits from the Hostess Brands acquisition, though lower volumes and recent divestitures partially offset these gains. Though The J. M. Smucker Company (NYSE:SJM) is a strong dividend company, its cash position took a hit this quarter. Free cash flow dropped significantly to $151.3 million, down 39.3% from the prior year, due to timing differences in tax payments and increased working capital needs. Operating cash flow also declined, highlighting the need for more disciplined cash management going forward. Despite these challenges, SJM remains appealing to income-focused investors, supported by a 23-year streak of dividend growth. Currently, it offers a quarterly dividend of $1.08 per share and has a dividend yield of 3.87%, as of May 13. Overall, SJM ranks 15th on our list of the best dividend growth stocks with high yields. While we acknowledge the potential of SJM as an investment, our conviction lies in the belief that some deeply undervalued dividend stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for a deeply undervalued dividend stock that is more promising than SJM but that trades at 10 times its earnings and grows its earnings at double digit rates annually, check out our report about the . READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at .
Yahoo
26-04-2025
- Business
- Yahoo
The J. M. Smucker Company (SJM): One of the Growing Dividend Stocks with Low PE Ratios
We recently published a list of the . In this article, we are going to take a look at where The J. M. Smucker Company (NYSE:SJM) stands against other growing dividend stocks. Value stocks are enjoying a rare period of strength amid this year's broader market downturn. With earnings season approaching, it remains to be seen whether their recent edge over high-growth stocks will hold. The S&P Value Index—which includes sectors like banking, consumer staples, and healthcare, featuring companies that trade at relatively low valuations—has fallen around 9% this year. That's a smaller drop compared to the more than 15% decline seen in the growth-focused counterpart. Concerns over steep valuations in the tech sector, coupled with a wave of risk aversion triggered by tariffs, have pushed investors to shift from growth to value. While similar shifts haven't lasted long in the past, some investors believe that this time could be different, as expectations for value-oriented firms are modest enough that they may exceed them when earnings reports begin next month. Dan Morgan, senior portfolio manager at Synovus Trust, made the following comment about value investing: 'The bar has been set pretty low for value stocks compared to the uncertainty surrounding growth names and their ability to deliver on earnings estimates. If value can at least match or slightly beat expectations, the runway is clear for them.' According to data from Bloomberg Intelligence, analysts are forecasting a 12% decline in first-quarter earnings for value companies compared to the same period last year, while growth companies are expected to post a 20% increase. Supporters of value stocks believe that these lower expectations are already factored into their relatively modest valuations. On the other hand, optimism surrounding growth stocks—particularly in the tech sector—has soared in recent years, largely driven by enthusiasm over advancements in artificial intelligence. Historically, value stocks have lagged behind. Over the past 20 years, the S&P 500 Value Index has only outperformed its growth counterpart five times on an annual basis. During that period, the value index climbed 202%, while the growth index surged by 600%. Michael O'Rourke, chief market strategist at JonesTrading Institutional Services, made the following statement: 'Growth is about 40% more expensive; this outperformance of value was very long overdue. Due to the incredible strength of the Magnificent Seven, too many investors crowded into growth thinking it won't correct.' Investors often turn to dividend stocks when looking at companies with lower valuations. Dan Lefkovitz, a strategist at Morningstar Indexes, pointed out that dividend-growth stocks—those known for consistently raising their payouts—have underperformed the broader market in 2024. He attributed this to a market that has largely been driven by a handful of fast-growing tech names. However, he also remarked that while dividend-paying stocks may trail during such growth-led rallies, they tend to hold up better during market downturns, as seen in 2022 and 2018. Companies that consistently raise their dividends are often both profitable and financially stable—traits that become especially important during times of economic downturn. A wholesaler distributing peanut butter, fruit spreads and specialty spreads to a retailer. For this list, we focused on dividend-paying companies that have consistently paid dividends over the years and have also demonstrated a track record of increasing their payouts. From that group, we considered stocks with forward P/E ratios below 25, as of April 22. The stocks are ranked in ascending order of their P/E ratios. At Insider Monkey, we are obsessed with hedge funds. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter's strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (). Forward P/E Ratio as of April 22: 11.24 The J. M. Smucker Company (NYSE:SJM) is an American food company, based in Ohio. The company manufactures a wide range of food and beverage products. On April 17, the company declared a quarterly dividend of $1.08 per share, which was in line with its previous dividend. Overall, it has raised its payouts for 23 consecutive years. The stock's dividend yield on April 22 came in at 3.67%. In fiscal Q3 2025, The J. M. Smucker Company (NYSE:SJM) posted revenue of $2.2 billion, reflecting a 2% year-over-year decline. The company reported a net loss of $6.22 per diluted share, mainly due to noncash impairment charges tied to its Sweet Baked Snacks unit. On an adjusted basis, earnings per share climbed 5% to $2.61. Gross profit increased by $55 million, or 7%, supported by stronger pricing, lower costs, and contributions from the Hostess Brands acquisition. These gains, however, were partially weighed down by softer sales volumes and the effects of recent business divestitures. The J. M. Smucker Company (NYSE:SJM) also reported a healthy cash position for the quarter, generating close to $240 million in operating cash flow. Free cash flow totaled $151.3 million, and the company returned $114.4 million to shareholders through dividend payments. Due to its solid cash position, SJM is one of the best growing dividend stocks on our list. Overall, SJM ranks 6th on our list of the best growing dividend stocks with low P/E ratios. While we acknowledge the potential of SJM as an investment, our conviction lies in the belief that some deeply undervalued dividend stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for a deeply undervalued dividend stock that is more promising than SJM but that trades at 10 times its earnings and grows its earnings at double digit rates annually, check out our report about the . READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at .
Yahoo
23-04-2025
- Business
- Yahoo
Here's What Supports J.M. Smucker Co. (SJM)
Ariel Investments, an investment management company, released its 'Ariel Fund' first-quarter 2025 investor letter. A copy of the letter can be downloaded here. In the first quarter of 2025, the majority of the main U.S. indices saw a decline. Even though Wall Street is tense and markets are still volatile, the firm is taking advantage of the turbulence by carefully purchasing the undervalued stock of quality companies whose value should be realized over the long term. Against this backdrop, Ariel Fund returned -8.00% in the quarter, lagging both the Russell 2500 Value and Russell 2000 Value indices, which returned -5.83% and -7.74%. For more information on the fund's top picks in 2025, please check its top five holdings. In its first-quarter 2025 investor letter, Ariel Fund highlighted stocks such as The J. M. Smucker Company (NYSE:SJM). The J. M. Smucker Company (NYSE:SJM) manufactures and markets branded food and beverage products. The one-month return of The J. M. Smucker Company (NYSE:SJM) was 2.84%, and its shares lost 0.69% of their value over the last 52 weeks. On April 22, 2025, The J. M. Smucker Company (NYSE:SJM) stock closed at $117.73 per share with a market capitalization of $12.528 billion. Ariel Fund stated the following regarding The J. M. Smucker Company (NYSE:SJM) in its Q1 2025 investor letter: "Additionally, leading manufacturer of consumer food products, The J. M. Smucker Company (NYSE:SJM) traded higher over the period. While sales came in below expectations, a significant bottom-line beat and subsequent raise to its FY25 EPS outlook boosted shares. While Hostess remains under pressure, management reiterated its long-term sales target, with near term focus on stabilizing revenue. The company is implementing a five-pillar plan to improve the brand with marketing investments. Looking ahead, we believe SJM's portfolio of iconic and emerging foods brands, coupled with its broad-based innovation and productivity agenda, supports an attractive total shareholder return opportunity." A wholesaler distributing peanut butter, fruit spreads and specialty spreads to a retailer. The J. M. Smucker Company (NYSE:SJM) is not on our list of 30 Most Popular Stocks Among Hedge Funds. Our database shows that 37 hedge fund portfolios held The J. M. Smucker Company (NYSE:SJM) at the end of the fourth quarter, compared to 30 in the third quarter. While we acknowledge the potential of The J. M. Smucker Company (NYSE:SJM) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock. In another article, we covered The J. M. Smucker Company (NYSE:SJM) and shared the list of best pet stocks to buy according to billionaires. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors. READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks. Disclosure: None. This article is originally published at Insider Monkey. Sign in to access your portfolio
Yahoo
11-04-2025
- Business
- Yahoo
Institutional shareholders may be less affected by The J. M. Smucker Company's (NYSE:SJM) pullback last week after a year of 6.1% returns
Significantly high institutional ownership implies J. M. Smucker's stock price is sensitive to their trading actions The top 16 shareholders own 50% of the company Insiders have sold recently Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. A look at the shareholders of The J. M. Smucker Company (NYSE:SJM) can tell us which group is most powerful. The group holding the most number of shares in the company, around 84% to be precise, is institutions. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn). No shareholder likes losing money on their investments, especially institutional investors who saw their holdings drop 3.3% in value last week. However, the 6.1% one-year returns may have helped alleviate their overall losses. We would assume however, that they would be on the lookout for weakness in the future. Let's take a closer look to see what the different types of shareholders can tell us about J. M. Smucker. See our latest analysis for J. M. Smucker Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index. J. M. Smucker already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see J. M. Smucker's historic earnings and revenue below, but keep in mind there's always more to the story. Since institutional investors own more than half the issued stock, the board will likely have to pay attention to their preferences. Hedge funds don't have many shares in J. M. Smucker. Looking at our data, we can see that the largest shareholder is The Vanguard Group, Inc. with 13% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 7.9% and 6.9%, of the shares outstanding, respectively. After doing some more digging, we found that the top 16 have the combined ownership of 50% in the company, suggesting that no single shareholder has significant control over the company. While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. Quite a few analysts cover the stock, so you could look into forecast growth quite easily. The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves. Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group. Shareholders would probably be interested to learn that insiders own shares in The J. M. Smucker Company. The insiders have a meaningful stake worth US$425m. Most would say this shows a good alignment of interests between shareholders and the board. Still, it might be worth checking if those insiders have been selling. With a 12% ownership, the general public, mostly comprising of individual investors, have some degree of sway over J. M. Smucker. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies. I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Take risks for example - J. M. Smucker has 3 warning signs (and 1 which is a bit concerning) we think you should know about. If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts . NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Sign in to access your portfolio
Yahoo
01-03-2025
- Business
- Yahoo
Is The J.M. Smucker Company (SJM) a Cheap Food Stock to Buy According to Hedge Funds?
We recently published a list of the . In this article, we are going to take a look at where The J.M. Smucker Company (NYSE:SJM) stands against the other cheap food stocks to buy according to hedge funds. CNBC reported that The Conference Board's Consumer Confidence Index dropped to 98.3 for February, reflecting a slip of nearly 7% and below the Dow Jones forecast of 102.3. This marked the largest monthly drop the market has seen since August 2021. In addition, The Expectations Index dropped to a 72.9 reading, reflecting a decrease of 9.3 points. The measure has tumbled below the level consistent with recession for the first time since June 2024. These trends show that consumers are becoming increasingly pessimistic about the country's economic outlook, and this pessimism reached new heights in February due to skepticism surrounding rising inflation and a slowing economy, according to the Conference Board. Furthermore, the drop in consumer confidence is materializing amid President Trump's threats of additional tariffs against the US's trading partners. The US President recently declared that his previously announced tariffs against Mexico and Canada will move forward in March after a postponement of their implementation in February. CNBC reported that Stephanie Guichard, the board's senior economist for global indicators, said the following about the emerging situation: 'Views of current labor market conditions weakened. Consumers became pessimistic about future business conditions and less optimistic about future income. Pessimism about future employment prospects worsened and reached a ten-month high.' READ ALSO: and . Economists and experts opine that the situation is unpredictable and worrisome. Trump's tariffs may ignite another bubbling of inflation in a scenario where the Federal Reserve is weighing the odds of whether to slash interest rates further or hold steady as experts and policymakers chalk out the effects of the President's aggressive trade and fiscal policies, as reported by CNBC. Consumers are reflecting the worries of economists and experts, as the 12-month inflation expectations rose to 6%, up from 5.2% in the last month and considerably higher than the Fed's steady goal of 2%. CNBC reported that Guichard opined: 'This increase likely reflected a mix of factors, including sticky inflation but also the recent jump in prices of key household staples like eggs and the expected impact of tariffs. There was a sharp increase in the mentions of trade and tariffs, back to a level unseen since 2019. Most notably, comments on the current administration and its policies dominated the responses.' Treasury Secretary Scott Bessent rang caution bells regarding 'sticky' inflation and the potential for slow growth. He attributed the cause to former President Biden's administration, saying that he fostered an economy too dependent on government spending. He said the government's plan now is to develop a more diverse economy through deregulation, tax cuts, and tariffs. However, such a scenario is likely to have adverse effects on the food industry. Economists believe that such aggressive policies may drive the cost of food, apparel, toys, and appliances. CNBC reported that Bessent said: 'The previous administration's over-reliance on excessive government spending and overbearing regulation left us with an economy that may have exhibited some reasonable metrics but ultimately was brittle underneath, and heading for an unstable equilibrium.' We sifted through stock screeners, online rankings, and ETFs to compile a list of food stocks with a forward P/E ratio of less than 15. We then selected the top 10 most popular stocks among elite hedge funds as of Q4 2024. We sourced the hedge fund sentiment data from Insider Monkey's database. The list is sorted in ascending order of hedge fund sentiment. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter's strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (). A wholesaler distributing peanut butter, fruit spreads and specialty spreads to a retailer. Forward P/E: 11.38 Number of Hedge Fund Holders: 37 The J.M. Smucker Company (NYSE:SJM) manufactures and markets branded food and beverage products under a portfolio of brands. Its operations are divided into four segments: US Retail Coffee, US Retail Frozen Handheld and Spreads, and US Retail Pet Foods and Sweet Baked Snacks. Over the past five quarters, The J.M. Smucker Company (NYSE:SJM) has maintained strong trends and attained strong industry standing in the frozen foods and snacks segment. It has driven consistent top-line growth through advertising, trade, and innovation investments. In addition, its solid financial position is further supported by free cash flow conversion surpassing 100% due to efficient working capital management, particularly in inventory. It currently offers a quarterly dividend of $1.08 per share and has a dividend yield of 3.89% as of February 24. The J. M. Smucker Company (NYSE:SJM) also has a history of transforming modest investments into significant revenue streams. For instance, its 1998 purchase of Uncrustables for $1 million evolved into a mega brand generating nearly $1 billion in annual revenue. Overall, SJM ranks 7th on our list of the cheap food stocks to buy according to hedge funds. While we acknowledge the potential of SJM as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than SJM but that trades at less than 5 times its earnings, check out our report about the . READ NEXT: and Disclosure: None. This article is originally published at . Sign in to access your portfolio
