Dykstra's Deep-in-the-Money Call: Sysco

In my April 21 column, I suggested buying the October $20 Frontier Oil(FTO Quote) DITM calls. Readers that played by the rules and followed my advice should be cashing in their tickets this morning as this one turned into a winner when it traded at $9 on Wednesday. The Frontier trade stayed in play for just 15 days.

I hope to keep the momentum going with today's pick, which is Sysco(SYY Quote). The company distributes food, including meats, fruits, vegetables, desserts, and fully prepared meals as well as canned and dry foods. It also supplied products such as disposable plates and cups and tableware. Sysco operates in one of the most basic of industries; the distribution of food and related products and services to restaurants, nursing homes, hospitals, hotels, motels, schools, colleges, cruise ships, sports parks and summer camps - wherever a meal is prepared away from home.

The company is impressive in many areas. Its profits have risen for seven quarters in a row. It is gaining market share and has had a consistent return on equity (ROE) of 25% or more for the last several years.

In its most recent earnings announcement at the end of April, the company beat Wall Street's expectations. Despite slow sales at its restaurants and rising food costs, the company showed net income of $240.9 million, or 40 cents a share. That's up from $221 million, or 35 cents a share in the year-ago period. Analysts, on average, were calling for 39 cents a share.