Smithfield Foods Inc. (SFD): Today's Featured Consumer Goods Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model

Smithfield Foods ( SFD) pushed the Consumer Goods sector lower today making it today's featured Consumer Goods laggard. The sector as a whole closed the day up 0.9%. By the end of trading, Smithfield Foods fell $0.52 (-2.0%) to $25.82 on average volume. Throughout the day, 2,706,620 shares of Smithfield Foods exchanged hands as compared to its average daily volume of 2,374,800 shares. The stock ranged in price between $25.68-$26.53 after having opened the day at $26.40 as compared to the previous trading day's close of $26.34. Other companies within the Consumer Goods sector that declined today were: Tandy Brands Accessories ( TBAC), down 9.3%, Coca-Cola Hellenic Bottling Company S.A ( OCCH), down 5.8%, China New Borun Corporation ( BORN), down 5.5% and MGP Ingredients ( MGPI), down 5.4%.
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Smithfield Foods, Inc., together with its subsidiaries, engages in the production and marketing of fresh meat and packaged meat products in the United States and internationally. Smithfield Foods has a market cap of $3.7 billion and is part of the food & beverage industry. The company has a P/E ratio of 17.5, below the S&P 500 P/E ratio of 17.7. Shares are up 22.1% year to date as of the close of trading on Thursday. Currently there are 4 analysts that rate Smithfield Foods a buy, 1 analyst rates it a sell, and 5 rate it a hold.

TheStreet Ratings rates Smithfield Foods as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, revenue growth, attractive valuation levels, largely solid financial position with reasonable debt levels by most measures and increase in net income. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

On the positive front, Central European Distribution ( CEDC), down 11.1%, American Lorain ( ALN), down 10.1%, Cooper Tire & Rubber Company ( CTB), down 7.4% and Goodyear Tire & Rubber ( GT), down 7.0% , were all gainers within the consumer goods sector with Nike ( NKE) being today's featured consumer goods sector leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the consumer goods sector could consider iShares Dow Jones US Cons Goods ( IYK) while those bearish on the consumer goods sector could consider ProShares Ultra Sht Consumer Goods ( SZK).

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