Don’t Forget the Ketchup

The condiment giant, H. J. Heinz Company, does not get discussed much these days even during conversations about large consumer staples brands. Perhaps one reason for Heinz’s under the radar status has been its essentially dead share price since the spring of 2011, as Brooklyn-tough hedge fund activist Nelson Peltz fought his way onto the Board of Directors in an attempt to unlock more value from the enduring brand. Prior to that long period of fair money or dead money, the stock had enjoyed a sharp run off the 2009 bear market lows.

Looking at the weekly chart below, though, you can see that price is now attempting to move out of a well-defined, fifteen-month consolidation. The large buy volume bars at the bottom of the screen sure seem to hint at accumulation, or buyers of size layering in to position for a major breakout. Note the ascending triangle on the weekly chart below as well, typically a bullish consolidation pattern within the context of a prior, established uptrend.

With Heinz tailoring its product lines specifically towards each major country’s tastes and cultures, more so than most consumer product giants, the ability for them to adapt to emerging themes such as “gluten-free,” and elimination of high fructose corn syrup is apparent. I like Heinz as a long-term idea as long as $55 can be left in the dust here.

Also note on the second chart below, dating back over a decade, that all-time highs from the end of last century should be within reach once this major resistance level is exceeded.

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