Mar. 19 at 3:22 PM
$KHC $CPB $GIS
I am holding what I have. Still long.
We are all aware that if this Iran conflict drags on, marks will crash. And in that context, these names could fall more.
I think they are close to going sideways. I think the trading range here is +/- 20% from current prices.
My view is to buy more if we sell off more. Even if it falls -0-20% more. The reason:
1.) there are some scenarios where CPB & KHC have sum of parts value.
2.) I think they can sustain the dividend and typically equities wit higher yields like this rarely go past a 100-300 point spread vs jnk bonds which are around 6.5%. … they get into a bond ex dividend cycle and the spread widens around perceptions of a cut.
Case in point
$CPB has the worse debt ratio but the most upside in 1-3 years, and has the highest spread.
