Why pickles are now trumping vacation homes

Like it or not, a high-dividend slow grower is now a better buy than a fresh-faced, fast-growing Internet monopolist.

By Jim Cramer Apr 29, 2014 12:02PM

Pickles in bowl © Diana Taliun/Getty ImagesWhich would you rather own: a fast-growing, profitable, budding monopolist in the vacation home rental business that shot the lights out on its last quarter, or a slow-to-no­-growing purveyor of packaged goods at the supermarket that reported a quarter that was disappointing by its own admission? The Street on MSN Money


If you had to think about this answer even for a second, you should fold up shop or go watch the NBA and NHL playoffs, because the answer is pretty simple: You would much rather own the no-growth food company.


Let me make it really easy: The slow-growing food company is B&G Foods (BGS), with a 4 percent-plus dividend yield, which can grow either from the stock going down or from the dividend going higher.


The fast grower? It's a website manager that takes a cut from vacation properties it features online at its eponymous HomeAway (AWAY) site.


Yep, in this tape you need to be eating B&G pickles and owning the stock and staying away from either the real HomeAway site or the stock.


Here's what's so wrong. HomeAway is a monopolist with $3 billion in market capitalization. It makes good money and has a perfect balance sheet with a ton of cash because it did a cheap-as-can-be convert deal. It is growing north of 30 percent. It should earn $1 per share in 2016. Yet I think you wouldn't want to buy this stock until it sold at a price-to-earnings relative to growth (PEG) rate of slightly less than 1. That means it can still fall another 10 percent, easy. In fact, I might be too aggressive even recommending that tight a bid underneath.


But B&G? I would buy it here. In fact, I would buy it up 1 point from here, and if the company is able to regain some of the lost momentum it suffered from winter weather, I believe it could rally 10 percent from here. And that's not including the dividend.


I'm sure there are people reading this who have said that I have lost my mind. All I can say is you are losing your mind if you don't see this happening right now. I'm not asking you to like the sea change. I'm simply asking you to acknowledge it. Because, like it or not, it's happening.


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Jim Cramer's Action Alerts Plus: Check out this charitable trust portfolio to see the stocks Cramer thinks could be winners.





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45Comments
Apr 29, 2014 1:06PM
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Let me make it really easy: The slow-growing food company is B&G Foods (), with a 4%-plus dividend yield, which can grow either from the stock going down or from the dividend going higher.--

That is great if you are young and you have time to wait ( for example:  ACAS) for a stock to come back. ACAS dropped a 10% dividend and went down from 20 dollars to 5.
What if you have a huge healthcare bill or some other problem and have to sell stock. Part of the issue is that the average middle class American is not as wealthy as many in the market and most need to protect their principle.  People used to be able to ladder CD's and get good return rates. Now everyone seems to be forced into other riskier investment.

Apr 29, 2014 1:17PM
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It was a myth suggesting Bin Laden used inherited money to finance 9-11. He had backing.  And now using private banks to attack innocent business people in Russia could very easily backfire in a similar fashion. These amatuers we elect as our representatives because they look and sound so good could easily cost us again in a similar manner. Before attacking anyone you need clear justification backed by sound principle. Benghazzi was a screwup and I suspect anything this group we have now comes up with will follow the same path. JMHO
Apr 29, 2014 1:37PM
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"Newly released emails on the Benghazi terror attack suggest a senior White House aide played a central role in preparing former U.N. ambassador Susan Rice for her controversial Sunday show appearances -- where she wrongly blamed protests over an Internet video."

 

Surprise Surprise......... LMAO

Apr 29, 2014 2:20PM
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CNN ---------- Obama's Approval Rating At All Time Low

 

I can hear him now........ "Help me Beav"

Apr 29, 2014 2:24PM
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The Benghazi Embassy was being used to supply arms to the Syrian militants to fight Assad.  They were transferring 425 surface to air missiles to the rebels when someone talked and the place being lightly defended was easily robbed.  American sources feared these SAMs would be used on a commercial aircraft.  And we have a commercial aircraft missing?  Or was it actually a victim of this error on the part of the US authorities?  Three stupid allowing your weapons to be captured by your enemy. But who cares when you can just lie your way out of it because your populace is so stupid they would believe anything you tell them.  And yes it would seem we would complete the idiotic trifecta by electing the fool that was negligent in allowing the capture of the missile used on the commercial airliner to become POTUS.  This country is no longer blessed in my opinion.
Apr 29, 2014 12:42PM
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We make plenty of our own pickles every year - almost 50 quarts worth, so we've got that part covered.  And I'd rather own an actual vacation home than stock in some company that does vacation rentals.

Also, B&G could really be negatively affected by the drought in CA, but no mention of that by Cramer.

Next article...
Apr 29, 2014 1:09PM
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We used to have 7 million small farms and now we have less than 3 million.  So now we have huge steroid grown cucumbers made into pickles!
Apr 29, 2014 1:44PM
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"The email is also significant because in congressional testimony in early April, former deputy CIA director Michael Morell told lawmakers it was Rice, in her Sunday show appearances, who linked the video to the Benghazi attack. Morell said the video was not part of the CIA analysis."

 

Sounds like Michel learned to lie from Obummer.

Apr 29, 2014 4:33PM
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He's hanging Beav's picture on the ACORN "Wall of Shame"
Apr 29, 2014 4:03PM
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It's easy for you to keep them Beav.......... just let the air out of them and put them back in the drawer.
Apr 29, 2014 2:09PM
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And in breaking news from Fox ....new evidence has come to light in the President Obama - Lindberg baby kidnapping case ...

"he doesn't have an alibi" slurred sean hannity from his desk at McGinty's Irish bar on 5th and Broadway ......"yeah ..prove you were not there Obama..." ...mumbled donald trump through his leather mask and ball gag .....

Got to love the tea baggers ....
Apr 29, 2014 2:03PM
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Hilarious ....the bagger morons are going back to Benghazi .....keep it up bouchedags as it will certainly win you the next election ...wink wink ....

;)
Apr 29, 2014 4:39PM
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Almost 100 comments on Pickles....Sweet Geezus...

Oh wait a minute 90 of them aren't about pickles...


I picked pickles back in the late 50s, maybe early 60s..??

First year I was a picker, lots of bee stings...

Second year I was a Straw boss in the field, because I lasted 2 years.

We made most of our money off "gerkins or jerkins", something like that...?

Miss Lilly said "I never picked pickles", instead they were cucumbers, they became pickles later after being brined....But I still called them pickles, because I was the picker; She never did.

Apr 29, 2014 3:44PM
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But wait there's more .....Barry Sr was not only one of the 300 spartans ...he was also a one of the maccabees who fought the romans to a standstill ....

C'mon barry even you are not dumb enough to think anyone believes you .... after 2 years of posting you come up with a 14 year old veteran father ..... at least you got that dumb old cat lady to believe you !!! 

Vot !!! ;)
Apr 29, 2014 3:08PM
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another push for "dividend protection" this idiot thinks 4% yield will protect you from your stock going down

he has yet to explain how 4% yield per year helps you when the stock drops 10% or worse yet the company suspends the dividend like BAC just did.

much better would be to own the DIA which gives you a sure 2+ % yield paid monthly , while diversifying you across the entire dow 30

cramer can't beat the DIA and neither can 80% of hotshot mba's managing high fee mutual funds.

but if individual investors figure this out who would cramer have to ripoof with his nonsense

Apr 29, 2014 1:50PM
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 I bet Romney is very happy with the market.  Oh, Staples seems to be in a pickle though.
Apr 29, 2014 3:18PM
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Well done Adam Silver and the NBA ....farewell donald tokovitz sterling you old bigot ....when you and your ilk are dirt napping the world can progress ...
Apr 29, 2014 4:49PM
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wooooohoooooooo....!!  And it's been a fantastic day in the Markets.
Apr 29, 2014 4:48PM
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Is this going to number 100 or not...??
Apr 29, 2014 3:25PM
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Obummer........ "What have you done Beav?" ..."My ratings are lower than whale shlt"

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