Hain (HAIN) Soared on Strong Sales, But Sustaining Growth Might Prove Challenging - Barron's
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Hain Celestial (Nasdaq: HAIN) is lower on the session amid a negative Barron's report out over the weekend.
In short, Barron's thinks Hain has been performing well recently...almost too well. Barron's now sees Hain losing about one-third of its value as growth momentum slows or it falls off its current acquisition pace.
Hain has grown sales over 20 percent since adding new distribution channels, gaining shelf space with such names as Costco (Nasdaq: COST), Safeway (NYSE: SWY), Target (NYSE: TGT) and others.
While market share has tripled over the last three years, it's price-to-earnings multiple is 50 percent richer than peers, save for Annie's (NYSE: BNNY).
Slowing is being seen in Soy Dream and West Soy beverages, while competition is heating up in the Greek yogurt segment. Hain has also disposed of sandwich and meal preparation acquisitions made last year in discontinued operations. CEO Irwin Simon notes that no one product makes up more than 19 percent of Hain's sales, giving it some protection from underperformance by one product.
The stock is down 3.5 percent today. Traders are also keeping an eye on Whole Foods (NYSE: WFM), which likes to sell food items that are more natural than mass production.
In short, Barron's thinks Hain has been performing well recently...almost too well. Barron's now sees Hain losing about one-third of its value as growth momentum slows or it falls off its current acquisition pace.
Hain has grown sales over 20 percent since adding new distribution channels, gaining shelf space with such names as Costco (Nasdaq: COST), Safeway (NYSE: SWY), Target (NYSE: TGT) and others.
While market share has tripled over the last three years, it's price-to-earnings multiple is 50 percent richer than peers, save for Annie's (NYSE: BNNY).
Slowing is being seen in Soy Dream and West Soy beverages, while competition is heating up in the Greek yogurt segment. Hain has also disposed of sandwich and meal preparation acquisitions made last year in discontinued operations. CEO Irwin Simon notes that no one product makes up more than 19 percent of Hain's sales, giving it some protection from underperformance by one product.
The stock is down 3.5 percent today. Traders are also keeping an eye on Whole Foods (NYSE: WFM), which likes to sell food items that are more natural than mass production.
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