Tuesday, November 30, 2010

Break Out the Snacks! J & J Snack Foods (JJSF)

I was taking a cruise through the snack food universe (through the charts, not the grocery store aisles), and I found this pretty chart that I wanted to share with you of J&J Snack Foods Corp (JJSF) (click all images to make larger).

There is much to like about this name both fundamentally and technically (but see longer term chart below).

  • Beautiful inverse head and shoulders pattern 
  • clean breakout at neckline on good 2.33 x relative volume
  • clearing of volume@price overhang bars
  • caution warranted to wait for a pull back on the overextended price
Fundamentally (check them out on FINVIZ):
  • They have a quarterly cash dividend of .1175 up from .1075 (though I don't screen for that)
  • Recently beat on earnings
  • Great balance sheet (cash, good current ratio, no l-t debt)
I also like to take a step back and look at longer term charts.  Let's look at a monthly chart:

Lots of happy holders in this name!  However, the chart is approaching all time highs; accordingly it would be wise to look at valuations in addition to earnings growth as part of your due diligence to see if it fits with your investment theme. 

Position:  Watch list!