Topic: Growth Stocks

Wall Street Stock Forecaster Hotline – Friday, May 16, 2014

Article Excerpt

HILLSHIRE BRANDS CO., $36.62, New York symbol HSH, makes a variety of packaged meat products. Its main brands include Ball Park hot dogs, Jimmy Dean sausages and Hillshire Farm deli meats. Other foods include Sara Lee frozen desserts and Chef Pierre pies. This week, the company agreed to buy rival Pinnacle Foods (New York symbol PF), whose main brands include Duncan Hines baking mixes, Vlasic pickles, Mrs. Butterworth’s table syrup and Birds Eye frozen dinners. Hillshire will pay $4.3 billion in cash and shares, though if you include Pinnacle’s debt, the entire transaction is worth $6.6 billion. Hillshire expects to close the deal in September 2014. At that point, Pinnacle shareholders will own 33% of the combined company. This is a huge purchase for Hillshire, which has a market cap (the value of all outstanding shares) of $4.5 billion. If Hillshire backs out of the agreement, it will pay Pinnacle $163 million. That’s equal to 89.6% of the $182 million, or $1.47 a share,…