The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage. The opinions expressed are those of the author and do not represent the views of TheStreet or its management.By Ian Wyatt NEW YORK (
Now, as the economic recovery solidifies I'm betting that many consumers won't quickly jump back on board the brand name train - rather they'll stick to their more generic, and value oriented products. TreeHouse Foods made two strategic acquisitions in 2010, spending $665 million on Sturm, a maker of private label hot cereal and soft drink mixes, and $180 million for S.T. Foods, which manufactures private label macaroni-and-cheese and other dinner products. As it digests those deals, TreeHouse is carrying debt approaching $1 billion. Earnings per share in 2010 grew slightly over 2009, $2.51 vs. $2.48. From 2008 to 2009, by comparison, EPS more than tripled. In the current quarter the consensus estimate from Thomson Reuters calls for a 23% increase in revenue and a 13% rise in earnings per share, to $0.66. I consider TreeHouse Foods a nice growth play in a value sector. I constantly seek out stocks that are undervalued, and the gains that TreeHouse Foods posted reaffirm for me that small-cap stocks always outperform coming out of a recession.
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