Strawberry Jam Dog Food Cat Food Coffee

Smucker’s brands include cat and dog foods.

When I go to the grocery store, I sometimes buy jam or preserves. I like lots of fruit. Therefore, I avoid jelly and buy more fruit for my dollar. I prefer strawberry, apricot, peach, and cherry jams. Rhubarb jam is a wonderful choice as well. When I think quality, I usually think Smucker’s. But when I think Smucker’s, I don’t usually think dog and cat food or coffee or Crisco shortening. Smucker’s is all of these.

Smucker’s is a Dividend Growth Investment (SJM)

In this week’s edition of Barron’s, the following table appears. I already knew that SJM had increased their dividend before I read Barron’s. That is because I received a Seeking Alpha alert about the dividend increase. I have been watching SJM for some time. In February of this year I bought 100 SJM shares. I then sold a covered call on the shares, and my shares were called away a month later. Therefore, I realized a short-term IRA profit on the sale of the SJM shares and received the covered call option income as well. When I saw the dividend announcement, I bought 100 shares of SJM.

The J.M. Smucker Company dividend increase of 10%.

Long-Term investing can be short-term if the price is right.

The secret (which really isn’t a secret) in long-term investing is to buy an investment at a reasonable price before the herd of investors starts to want the shares. But that doesn’t mean I will hold the investment indefinitely. SJM currently yields 3.03%.

If the price of the shares grows to $145 per share, the yield on price will drop to 2.7%. I still get the same annualized dividend, and my yield on the cost of the shares is still 3.03%. However, if I were to sell the shares at $145, I would realize a profit of more than 10%. Sometimes, if there is irrational exuberance about a stock, I will sell to lock in the gain which is better than the yield. However, I would probably only do this using a covered call option.

Company Profile

The J. M. Smucker Company manufactures, and markets branded food and beverage products worldwide. It operates in four segments: U.S. Retail Coffee, U.S. Retail Consumer Foods, U.S. Retail Pet Foods, and International and Away From Home. The company offers mainstream roast, ground, single serve, and premium coffee; peanut butter and specialty spreads; fruit spreads, shortening and oils, and frozen sandwiches; pet food and pet snacks; and foodservice hot beverage, foodservice portion control, and flour products, as well as dog and cat food, frozen handheld products, juices and beverages, and baking ingredient. It provides its products under the Folgers, Café Bustelo, Dunkin’ Donuts, 1850, Jif, Smucker’s, Crisco, Smucker’s Uncrustables, Meow Mix, Kibbles ‘n Bits, 9Lives, Nature’s Recipe, Milk-Bone, Pup-Peroni, Rachael Ray Nutrish, Natural Balance, Robin Hood, and Five Roses brands. The company sells its products through direct sales and brokers to food retailers and wholesalers, club stores, pet specialty stores, discount and dollar stores, drug stores, military commissaries, mass merchandisers, natural foods stores and distributors, and online retailers; and through retail channels, and foodservice distributors and operators. The J. M. Smucker Company was founded in 1897 and is headquartered in Orrville, Ohio.

Full Disclosure

I own 100 shares of SJM as a long-term investment.