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SunOpta Inc. Message Board

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    • I will also add that while this interview proves some of us have been right about the company and the track they are on, the interview also proves that some people have been blowing smoke. Would a real investor who claims to own thousands of shares not even know how much food sold is certified organic? These are the kinds of posts by people like b.macmanhon who are hoping to deter people from investing. Meanwhile, institutional ownership continues to rise. I've been invested in this company since 2005 and there have been some excellent opportunities to cost-average in. Since that time, the company has put together a much stronger and much more vibrant operation that will be able to meet the rising global demand for these types of foods. That means they are one of the first candidates for a buyout or a merger.

    • The interview pretty much states exactly what I've been saying over the last year. Margin improvements are stronger in some areas than other with a strong growth pattern in organics and international sales. Add in the focus in private label and moving to more manufactured products and this is precisely what shareholders would like to see. Interviews like this are good because they look at the key issues surrounding the company and they point to the shareholders who have been on track. This is hardly a "pretend organic food company" and it's pretty obvious that most organic food sales are in stores rather than local farmers' markets. Bigger and better things are coming for SunOpta and the global aspect is going to be increasingly important.

    • good link, Trek. I see management's view of the chessboard and an opportunity does exist to consolidate and acquire companies in several of their business segments.

      If they deliver on that without taking on too much debt

      If they integrate the acquisitions so they don't blow up like the frozen fruit business

      If they natural/organic food trends continue

      If the speculative money flows into commodities don't batter them around and make their costs unmanageable

      If they don't get muscled out by some of the bigger food companies as they try to move up the value chain

      If consumers can be counted on to choose good quality, private label foods rather than the branded major food company lines

      If they can occasionally pass on pricing to the consumer who expects private label products to have lower pricing

      Then the value of the company might increase and possibly attract buyout interest. Attracting buyout interest, though, requires them to become so good at what they do that they become an irritant to larger food companies. I don't think they are anything close to an irritant yet. The big food companies would not have to buy STKL currently to take their business. There are few barriers to entry, I'm afraid.

      • 2 Replies to tjuliar16
      • I can point out some very basic misconceptions in tjjuliar's post.

        "If they deliver on that without taking on too much debt."

        Company debt has been dropping quite fast and inventory turn is robust. They already are delivering.

        "If they integrate the acquisitions so they don't blow up like the frozen fruit business"

        Fruit was a one-time problem. Other acquisitions have been much more smooth. Tradin is a good example.

        "If they natural/organic food trends continue"

        Why would it stop? The industry is a global megatrend. The CEO of Kraft says organic food is a freight train that cannot be stopped.

        "If the speculative money flows into commodities don't batter them around and make their costs unmanageable"

        Short-run margin fluctuations are less severe than long-run margin growth and the company has done a pretty good job of passing on costs in most areas.

        "If they don't get muscled out by some of the bigger food companies as they try to move up the value chain"

        There are no companies who have the vertical integration nor do they have the supplies of raw materials. That's not even an option.

        "If consumers can be counted on to choose good quality, private label foods rather than the branded major food company lines."

        Consumers have always chosen healthy and organic foods in this industry over branded foods. The marginal propensity to consume increases with the organic label.

        "If they can occasionally pass on pricing to the consumer who expects private label products to have lower pricing."

        Marginal production costs go down in the long-run. There is also no competition here. Consumers have been show to buy these products in light of higher prices.

        "Then the value of the company might increase and possibly attract buyout interest. Attracting buyout interest, though, requires them to become so good at what they do that they become an irritant to larger food companies. I don't think they are anything close to an irritant yet. The big food companies would not have to buy STKL currently to take their business. There are few barriers to entry, I'm afraid."

        Dead wrong. There are too many barriers to entry including supplies of organic food, SunOpta being a vertically integrated company and increasing demand meaning higher prices over marginal production costs. That means they're a strong buyout candidate right now.

      • TJ
        Excellent post. A lot of moving parts on different levels, imo. The Mascoma IPO, Minerals, the market, ect. Probably Greece and Italy will effect shareholders more than the core business, lol.

    • Nice find. Thanks.

    • A very long way to go.

 
STKL
12.850.00(0.00%)Sep 19 4:00 PMEDT

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