Why AGFEED INDUSTRIES is the Stock Everyone should Track
You may be an Obama supporter and thus absolutely detest Rush Limbaugh. But what I am about to share needs to be read before I make my statements.
And before I make my statements.... Let me be perfectly clear about 2 things:
1) I am still holding on to my shares in (FEED) AgFeed Industries.
2) (FEED) remains a 5 star stock inspite of such a steep decline in share price knocking it completely off the requirements for Motley Fool Caps.
So... After reading that... And digesting the type of business AgFEED Industries runs, that being "FEEDING" the citizenry with Fresh Pork...
What is going to happen to AgFEED Industries? If you still have shares of (FEED) should you sell em all off in panic?
I say NO!
The thing with AgFEED is when *&^% hits the fan this is how it shapes up.
1) Hog Prices will crash like nothing you can believe and the sale of Hogs will (if not already) become a useless proposition to try and make money off of it. Given the expense to pay workers, I highly doubt AgFEED can continue to earn profits off of the sale of their Pigs when things really turn sour.
2) The Bright side is the cost of (FEED) goes up and AgFEED for a short period of time gets to enjoy higher margins on the sale of FEED.
But you know what is coming? You realize what the dreaded word being whispered and shouted and passed around Wall Street is?
Gerry Daignault is about to witness one amazingly scary disaster that he will have to maneuver around and I think he's got the guts and brains to pull it off.
In a period of Hyperinflation, AgFEED Industries will find itself unable to sell their Feed Product to Farmers who (because of high unemployment + Hyperinflation on FEED prices + HyperDeflation on Hog Prices).... I mean... Total disaster for any Hog Farmer to make a living selling hogs.
So unfortunately... No one is going to earn money selling hogs here....No one....forget it....don't even pretend... (FEED) would still be a $10 stock if investors believed their business was still sound.
So bail out on FEED? Really? Liquidate it? Maybe...
But I have my theory that China needs Hog Farmers as much as Hog Farmers will end up needing the Chinese Government to bail them out. And AgFEED will get slammed hard like nothing you have ever seen a 5 Star Stock do... but that company will survive and come out of this a stronger, more dominant company than ever before.
Nonetheless.... If you are as brave as I am in willing to hold those shares.... Take my advice and think long and hard before accumulating any shares of (FEED).
Read the article before clicking (BUY) for (FEED) stock.
I'm letting this one play-out in my portfolio but let me be the idiot/stupid investor who takes this insane risk.... Be smart and find something that at least pays dividends to their shareholders.