price to sales ratio

HILLSHIRE BRANDS CO. $36 (New York symbol HSH; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 122.4 million; Market cap: $4.4 billion; Price-to-sales ratio: 1.1; Dividend yield: 1.9%; TSINetwork Rating: Average; www.hillshirebrands.com) makes a variety of packaged meat products. Its main brands include Ball Park hot dogs, Jimmy Dean sausages and Hillshire Farm deli meats.

In June 2012, the old Sara Lee Corp. spun off its international coffee and tea business, D.E. Master Blenders, as a separate company. The remaining operations became Hillshire Brands.

Hillshire gets 74% of its sales from supermarkets and other mass retailers; Wal-Mart is its largest single customer, accounting for 25% of its total sales. Restaurants supply the other 26%.

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KRAFT FOODS GROUP INC. $57 (Nasdaq symbol KRFT; Conservative Growth and Income Portfolios, Consumer sector; Shares outstanding: 596.3 million; Market cap: $34.0 billion; Price-to-sales ratio: 1.9; Dividend yield: 3.7%; TSINetwork Rating: Above Average; www.kraftfoodsgroup.com) makes a variety of grocery products, including Kraft macaroni and cheese, Oscar Mayer meats, Philadelphia cream cheese, Maxwell House coffee, Jell-O desserts and Miracle Whip salad dressing.

Unlike Mondelez, Kraft prefers to focus on North America: Wal-Mart accounts for 26% of its sales. That hurts its growth prospects, but it also cuts its currency risk.

Kraft continues to reduce its costs following the breakup with Mondelez, mainly by consolidating facilities, laying off employees and eliminating less-profitable products. These moves are helping Kraft offset rising ingredient costs.

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MONDELEZ INTERNATIONAL INC. $35 (Nasdaq symbol MDLZ; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 1.7 billion; Market cap: $59.5 billion; Price-to-sales ratio: 1.8; Dividend yield: 1.6%; TSINetwork Rating: Above Average; www.mondelezinternational.com) took its current form on October 1, 2012, when the old Kraft Foods Inc. broke itself into two publicly traded companies: Mondelez International and Kraft Foods Group.

Mondelez makes cookies and biscuits (Oreo, Chips Ahoy, Ritz), chocolate bars (Cadbury, Toblerone) and gum and candy (Trident, Chiclets and Halls cough drops). It also makes beverages, including coffee (Tassimo) and powdered fruit drinks (Tang), as well as grocery and cheese products for overseas markets. The company gets 40% of its sales from developing countries, 40% from Europe and 20% from North America.

Mondelez has now completed its plan to cut its annual costs by $800 million following its 2010 purchase of U.K.-based chocolate maker Cadbury.

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BAXTER INTERNATIONAL INC. $72 (New York symbol BAX; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 540.9 million; Market cap: $38.9 billion; Price-to-sales ratio: 2.6; Dividend yield: 2.7%; TSINetwork Rating: Average; www.baxter.com) is the latest of our recommendations to announce a spinoff. (We analyze three other recent spinoffs in this issue.)

Baxter plans to split into two separate companies. One will focus on medical devices, such as intravenous pumps and kidney-dialysis equipment. This business provides 60% of Baxter’s total revenue. The other firm will make biopharmaceuticals, including vaccines and hemophilia drugs.

In mid-2015, Baxter will hand out shares in the biopharmaceutical company to its shareholders as a tax-deferred dividend.

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CHEVRON CORP. $125 (New York symbol CVX; Conservative Growth Portfolio, Resources sector; Shares outstanding: 1.9 billion; Market cap: $237.5 billion; Price-to-sales ratio: 1.1; Dividend yield: 3.2%; TSINetwork Rating: Above Average; www.chevron.com) is the second-largest integrated oil company in the U.S. by revenue, after ExxonMobil (New York symbol XOM).

Chevron gets 90% of its earnings by producing oil (67% of total production) and natural gas (33%). The remaining 10% comes from its refineries, petrochemical operations and 8,050 gas stations in the U.S., which operate under the Chevron and Texaco banners. The company owns 400 of these locations and supplies fuel to an additional 8,600 stations outside the U.S.

At the end of 2013, Chevron’s proven reserves totaled 11.2 billion barrels of oil equivalent (57% oil and 43% natural gas). Based on its average 2013 production of 2.6 million barrels a day, that would last 11.8 years.

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RioCan, along with other real estate investment trusts (REITs), faces several challenges that are beyond its control. For example, interest rates will likely rise in the next few years, making bonds more appealing to income-seekers and hurting REITs. Meanwhile, rising online competition has forced retailers that sell books, music and electronics to close stores.

However, RioCan is taking steps to continue prospering....
CAE INC. $15 (Toronto symbol CAE; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 263.2 million; Market cap: $3.9 billion; Price-to-sales ratio: 1.8; Dividend yield: 1.6%; TSINetwork Rating: Average; www.cae.com) recently sold five flight simulators to Southwest Airlines, Lufthansa and other customers.

In all, these orders are worth $75 million....
Interest rates will probably stay low for the next year or two. That should encourage income-seeking investors to keep buying high-yielding utilities.

These four power providers continue to invest in new projects, which will give them more cash flow for dividends....
BLACKBERRY LTD. $8.66 (Toronto symbol BB; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 526.6 million; Market cap: $4.6 billion; Price-to-sales ratio: 0.5; No dividends paid; TSINetwork Rating: Speculative; www.blackberry.com) lost $711 million, or $1.35 a share, in the fiscal year ended March 1, 2014 (all amounts except share price and market cap in U.S....
LOBLAW COMPANIES LTD. $46 (Toronto symbol L; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 412.5 million; Market cap: $19.0 billion; Price-to-sales ratio: 0.4; Dividend yield: 2.1%; TSINetwork Rating: Above Average; www.loblaw.ca) has completed its acquisition of Shoppers Drug Mart, which operates 1,253 drugstores across Canada.

Loblaw paid $12.4 billion, consisting of $6.6 billion in cash and $5.8 billion in shares....