GMO vs Non-GMO: A Tale of Two Stocks

19 Nov, 2013

Guest Article by Robyn O’Brien, cross posted from Prevention.com

If the market is any indication, a look at the share price and escalating growth of Annie’s versus the collapsing growth of Kellogg’s tells a story about our food supply that no marketing campaign can.

In the last year, due to soaring consumer demand for products free from artificial ingredients, Annie’s growth has exploded. Annie’s most recent quarter saw $57.9 million in net sales, representing a year over year increase of 24%. Earnings per share were up 19.1% and consumption up 22%. Annie’s, which produces real food with real ingredients, also just made a $6 million plant acquisition to expand capacity.

Contrast that with Kellogg, which just announced “Project K”, an initiative in which they will be laying off 7% of their employee base, along with an announced plant consolidation. In the United States, sales have been down for the last two quarters. Kellogg said sales in its U.S. Morning Foods segment fell by 2.2%. And while they recently purchased Pringles, to expand into the snack food category, Kellogg said sales in the U.S. snacks segment also fell by 2.5%.

A food awakening is happening around the country, largely driven by the escalating rates of conditions like allergies, diabetes, obesity and cancer. Consumers can no longer afford to remain illiterate in what they are putting into their bodies. The companies that recognize this are seeing explosive growth and skyrocketing share prices.

Chipotle is another recent example. Wall Street fell in love with their non GMO burrito, and their shares soared on the announcement that they would remove genetically engineered ingredients (and the portfolio of chemicals required to grow them) from their product line.

Companies like Kraft would give their right arm for that kind of revenue growth and upward trajectory in share price. What they have yet to realize is that they don’t have to, they simply have to give up the junk—like artificial dyes, artificial growth hormones and genetically engineered ingredients and meet the consumer where she stands—in the aisles of the store, holding onto a kid with allergies, asthma, diabetes, ADHD or any number of the conditions impacting our children today.

This demand for clean food is no more of a fad than the rates of cancer, autism and other conditions impacting our families. Farmers, food companies and families are paying attention, and first-movers are securing the market advantage.

The food awakening is on. As companies, along with the consumers, wake up to this, it begs the question: Which stock will be the next one to soar?

Robyn is former equity analyst that covered the food industry and author of “The Unhealthy Truth.” She is also the founder of AllergyKids, whose mission is to restore the health of American families by addressing the needs of the 1 in 3 American children that now has allergies, autism, ADHD and asthma and the role that additives in our food supply are having on our health.

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  • ganges

    Change for the better, never happens fast, especially where money is concerned.. But if this trend continues, the money will be the deciding factor… Corporations that poison us now, will turn to healthier foods. Not because of health but because of the money.. That is a shame, but whatever works..

  • GroomLeader .

    Suck on that one Kellogg’s. Make real food, not garbage, and maybe you wouldn’t be tanking. No sympathy from this corner.

  • DB25

    Yet Prop 37 and I-522 in California and Washington state, providing labeling for products containing GMOs, were both defeated – in part due to funding provided by Kellogg’s.

  • David

    Robin, this is very important information!
    Please – date your work!! People will be passing this article around for months, maybe years to come. It is important to document WHEN these things are written.
    If organicconnectmag does not make it easy to date their contributors work, may I suggest that you start an article with “Well, it is Nov 2013, and if the market is any indication…”
    I will be sharing this information. I can only hope it is current. :-)

  • David

    To the folks at organicconnectmag –
    The information you share with the world is very important.
    I want you to know that I do appreciate it very much.
    Please consider date-stamping your articles. :-)

  • MrsSpooky

    It says at the top that it was cross posted from an article on prevention.com. I clicked the link to get to the original article which IS dated: Nov 01, 2013 10:57 am Posted by Robyn O’Brien

  • Diane Porter

    thank you for such an incouraging article i really think we have reached a turning point in our battle against gmos

  • Tony

    Wonderful job, keep up the great work.

  • Dan Wico

    Why generalize what consumers want in such a fashion? I am willing to bet the decrease in Kellogg of only 2% is more than the annual net of the baby company u compare it to. When did less than 1% of the consumers start dictating what we want?

  • Fctwo Willie

    So uh….Annies is making huge profits by playing off the fears of psuedoscientific alarmist and gouging them with exhorbitant prices and we are supposed to praise them selling us snake oil?

  • Aaron David

    The big names won’t change. They are past caring about profits. The agenda is genocide, and it’s not going to stop to pick up pennies. The truth is that there is, and will continue to be, an organic produce supply ceiling. It won’t budge once it is reached.

  • Diane Porter

    yes it was defeated however there is nothing more powerful than a smart consumer word of mouth works for me