Investors should be careful with this food inventory
TreeHouse Foods, Inc. (NYSE: THS) is a multinational food processing company specializing in the manufacture of packaged food for private label products. The company manufactures and sells packaged food and beverages under private label in more than 40 manufacturing facilities in the United States, Canada and Italy.
On March 22nd, TreeHouse Foods announced that its Board of Directors has elected Ann M. Sardini as Chairman of its Board of Directors. This change in leadership will reportedly take effect starting April 2021 during TreeHouse Foods’ annual shareholders meeting. Sardini has been an independent TreeHouse director since May 2008.
The food giant most recently rose 1% to $ 53.92. THS saw minimal growth over the past week amid the leadership news. However, TreeHouse stock is already up 26% year-to-date and 39% year-over-year, and is up 53% since its 11-year low of $ 35.15.
In 2020, TreeHouse Foods was among the companies to benefit from the Covid-19 pandemic. The company increased sales by approximately $ 60 million, or 1.4 percent, and had total sales of $ 4.35 billion. TreeHouse Foods increased its net income nearly $ 375 million, bringing the company into profitability.
In general, TreeHouse Foods is not an ideal investment. Despite the company’s strong performance over the past year, THS sales have declined dramatically in recent years. Since fiscal 2017, TreeHouse Foods has lost nearly $ 2 billion, a decrease of more than 30%. Additionally, TreeHouse Foods’ bottom line has a history of instability with the company reporting huge net losses quite often.
Overall, investors should stay cautious and don’t be fooled by a decent year amid a global pandemic. The best way for those considering adding TreeHouse Foods shares to their portfolio as a turnaround is to wait for the company’s next two earnings reports and assess an ongoing trend of positive performance.