Premium Brands Holdings Corp. has been on a six year run

May 1st, 2015 – Comment

Although there are no indications that we can expect a trend reversal it is evident that PBH has moved up very aggressively in a short period of time.


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Premium brand holdings keeps growing and going! Does this stock have more long term upside?

Doug

 

Hey Doug,

Thanks for the assignment. Your excitement would seem to indicate that you have been enjoying the ride. Congratulations!  Premium Brands Holdings Corp.(PBH TSX) is a British Columbia based specialty food producer with differentiated distribution. The company has interests in regional brands that are positioned as big fish in little ponds with channels into the food service and retail segments. Their operational focus is on food products that they describe as delicious and nutritious with verifiable links from farm and sea to fork.

The company has concluded fifty deals while building out their portfolio and with that has developed acquisition expertise. A recently completed $69 million debenture financing will provide management with the resources to continue making deals.

An exploration of the charts will help identify if PBH has more gas in the tank.

 

 

PBH

The three-year chart indicates that investors should be very pleased with the progress the stock has made. The uptrend has been in place since 2009 when the stock was trading for just over $7.00 What is evident is that the advance has tested support along the moving averages but buyers have been willing to step up and buy on the dips. The steep move higher that started in mid March of 2015 was ignited by the release of Q4 results that reported increased revenue, earnings, and a bump to the dividend.

The MACD and the RSI were signalling a buy near $22.00 in December of 2014 as the stock retested the 200-day moving average.

 

 

 

 

 

PBH2

The RSI on the six-month chart points out that the shares have been overbought for over six weeks as buyers have taken control of the market. Although there are no indications that we can expect a trend reversal it is evident that PBH has moved up very aggressively in a short period of time. Should the shares pullback there is a ledge of support at $30.00.

The next flex point for PBH will be when it reports its Q1 results. With the $69 million financing in place management has the resources needed to move forward with expansions and acquisitions. The dividend yield of 4.35% also provides incentive to stay in the saddle.

Next time I will inspect the charts of The North West Company Inc. (NWC TSX) for Wayne.

Make it a profitable day and happy capitalism!

 

 

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