Diamond Foods (DMND): Popcorn play

Diamond Foods (Nasdaq:DMND), which sells snack nuts and nut mixes, is a buy-rated holdings in the model portfolio of Tom Bishop. Here's his update from BI Research.

"Emerald’s sales in U.S. food stores grew 48% over the prior year period, causing market share to jump 250 basis points to 8.4%. During this time, Emerald’s dollar sales growth exceeded the growth of the entire snack nut category which increased sales 2.7%.  So, very impressive growth here.

"The two flagship products in this line are its Cocoa Roasted Almonds and its Sea Salt and Pepper Cashews. Really you have to try these. I think the Emerald line is capable of taking this stock considerably higher led by these two work horses.

"And some times it is just that simple. All you need is a couple of really successful products. And combined with the company’s Pop Secret line, Diamond Foods may be destined for the 'Snack Hall of Fame'.

"The consensus for FY7/09 is $1.37 vs. last year’s $.91, but Diamond regularly beats estimates like a drum. On a calendar basis we are looking at about $1.54 this year. We continue to rate the stock a buy."
 

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