Cooking is one of my favorite ways to relax after a busy day of analyzing stocks.
Lately, my favorite meat to cook with is chicken because I can make a huge variety of dishes.
I’m far from the only one using more poultry, based on the National Chicken Council’s reports of annual increases in Americans’ consumption of poultry since 2012.
In 2012, Americans ate 96.7 pounds of poultry per capita. Last year, that figure was 113.3 pounds … and it’s going up from there:
The world has continued to increase its consumption of poultry products, including chicken and turkey.
The chart above shows that the poultry we consume worldwide will jump 13.8% by 2030.
Today’s Power Stock is one of the leading poultry producers in Mexico and the U.S.: Industrias Bachoco S.A.B de C.V. (NYSE: IBA).
IBA breeds, processes and sells chicken, eggs, turkey, pork, fish and pet food, as well as medicines and vaccines for animals.
It sells to wholesalers as well as supermarkets in both countries.
IBA stock scores a “Strong Bullish” 100 on our Stock Power Ratings system, and we expect it to beat the broader market by 3X in the next 12 months.
IBA Stock: Behind the Perfect 100
Two items stood out after my deep dive into IBA:
- In 2021, the company registered annual sales of $4.1 billion — an 18% increase over the $3.5 billion it recorded in 2020.
- It will start to realize the benefits of its recent acquisition of RYC Alimentos — a beef, pork and chicken processor in Mexico — this year.
The Stock Power Rating above shows that IBA rates in the green on all six of our metrics, but it rates highest on value and quality.
IBA’s price-to-sales ratio of 0.6 is 10 times lower than the agriculture industry average!
When we contrast its price-to-earnings ratio of 9.3 to the industry average of 15.8, we see that IBA stock is a much better deal than its peers.
The company’s return on equity of 10.7% beats the pants off the agriculture industry’s average of negative 42.9%.
IBA stock hit a 52-week low in March 2022, but it then rebounded.
It rocketed up 26.7% since to reach a 52-week high — showing the maximum momentum we love to see in stocks.
Industrias Bachoco stock scores a 100 overall on our proprietary Stock Power Ratings system.
That means we’re “Strong Bullish” and expect it to beat the broader market by at least three times in the next 12 months.
Our need for poultry will grow. But with its diversification into beef processing, IBA is even better positioned to provide terrific gains in the future.
Bonus: IBA’s forward dividend yield of 2% means shareholders earn $0.92 per share, per year to own the stock.
Stay Tuned: Top IT Consultant
Remember: We publish Stock Power Daily five days a week to give you access to the top companies that our proprietary Stock Power Ratings identify!
Stay tuned for the next issue, where I’ll share all the details on an IT consulting stock you should consider for your portfolio.
Matt Clark, CMSA®
Research Analyst, Money & Markets
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