Coronavirus and the Oracle of Wall Street

March 25, 2020

What stock prices for center store processors tell us - or don't.

For business journalists (and a lot of others), the stock market is like the Oracle of Delphi: supernaturally inspired, but you can’t always tell what it means.

Conventional wisdom is that in times of crisis, consumers turn to center-store staples, especially comfort foods. Sales figures seem to be bearing that out for the coronavirus scare. Sales of items like Spam, Oreo cookies and canned tuna fish are all up; Mondelēz International and others are hiring workers. (I hope at least some of them are former restaurant workers and others who lost jobs because of the coronacrisis.)

On the other hand, some of those sales figures look a little, shall we say, context-challenged. For instance, sales of oat milk were up 347% year-over-year for the first week of March, which sounds impressive until you ask yourself: How many people were buying that stuff in the first place?

So I consulted the Oracle of Wall Street, looking at stock prices for the top half-dozen center-store processors on Food Processing’s Top 100 list. I tracked the price for March 2, the peak during the month, and the price as of this afternoon (March 25). What I found was, in every case but the first, a surge and then a fall:

COMPANY

MARCH 2

PEAK

CURRENT (MARCH 25)

Kraft Heinz

26.07

26.07

23.68

General Mills

51.41

59.67

48.45

Conagra Brands

28.24

29.80

25.95

Hormel Foods

43.19

48.53

42.10

Kellogg Co.

60.47

69.22

57.00

J.M. Smucker Co.

106.74

118.86

104.87

 My guess is that the market reacted to the surge in grocery staple purchases by nervous consumers, but then the general downward pull of the market swamped those gains.

But, as they say, your guess is as good as mine.