Chiquita Brands International, Inc. (NYSE:CQB)

ExitGrindAt50 (< 20) Submitted: 3/10/2009 4:04:49 PM : Start Price: $4.97 CQB Score: -78.12

The primary revenue generator here is bananas. Are people going to stop eating bananas during a recession? NO. Will people opt for alternatives to bagged salad products? Perhaps, but CQB is eliminating vendors who are not willing to absorb their price increases. If you cannot sell it for a profit, why sell it at all? Plus, this company generates a healthy amount of cash flow - which could see some major improvement if current EU tariffs are reduced. They also do not have any major debt maturities to repay until 2014. Management alluded to '09 earnings being in the neighborhood of $1.12 (better than '08). And this does not factor in any EU tariff reductions. My conservative DCF model puts their fair value at about $15. Once investors pull their heads out of the sand, they will realize this is a 3 to 4 bagger waiting to happen. This stock was trading at $15 not more than 6 months ago and the business has not materially changed since then.