Novice Investing - Fresh Del Monte Produce

Date: Sunday 20th 2008f July 2008 12:47:11 PM

Buying it Fresh 12/06/2004

By: Hari Wibowo

Industry background

Fresh Del Monte Produce Inc. (FDP) is the leading producer of high quality fresh and packaged produce. Some of the product includes banana, pineapple, apple, tomatoes and other fruits. This industry should see a nice growth in the future as the general population in the United States and other developed countries favor a healthier lifestyle. A conservative estimate for this industry is a 5 to 10% annual growth. Therefore, I do believe that FDP will grow at least 5-10% in revenue.

Reasons for buying FDP

Quarterly current ratio is improving steadily for FDP over the last four quarters. Furthermore, with estimated fair value of $42.8/share, current price represents 50% potential stock price appreciation for our investment. Finally, the company has abundant cash on hand while incurring low long term debt. For more details about the analysis, please click here.

On Monday 12/06/ 2004, we bought 69 shares of FDP at an average price of $28.69 with $10 broker commission. As we have said earlier, we would like our sample portfolio of $ 10,000 to contain 5 stocks with the same dollar amount. ($ 2,000 each). Here is the status of our sample portfolio.

Holdings	Date Purchased	# of shares	Purchase price	Current Price (updated weekly)	Total Value	Total gain/loss	% gain/loss
FDP	12/6/2004	69	$28.69	$28.69	$1,979.61	($20.39)	-1.02%
Cash					$8,000.00	$ -	0.00%
TOTAL PORTFOLIO					$9,979.61	($20.39)	-1.02%

Conclusion

I will review FDP on a regular basis as needed. In the meantime, I will find other suitable candidates for our sample portfolio. If you have any suggestions, you should talk about it at our discussion boards.

Disclaimer: The sole purpose of this article is educational. This article is merely the opinion of the writer and is not in any way a buy/sell recommendation regarding Fresh Del Monte Produce Inc. (FDP) or other securities.

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