Ingles Markets, Inc. (NASDAQ:IMKTA)

CAPS Rating: 5 out of 5

The Company supermarkets offer customers a wide variety of nationally advertised food products, including grocery, meat and dairy products, produce, frozen foods and other perishables and non-food products.

Recs

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Player Avatar TMFPencils (99.80) Submitted: 12/16/2006 7:05:34 PM : Outperform Start Price: $21.59 IMKTA Score: -25.00

Primarily run by the Ingle family (the founding family), who owns a good percentage of the company. Ingles has an experienced management team, and a strong foundation of stores with plans to open more in the future.

The balance sheet isn't very strong, but I think it will be strengthened going forward. Right now management is choosing to expand and invest in new equipment, which I think is a good move for this relatively small business.

Sales and earnings are growing incredibly quickly, 2006 has been a record year for earnings. Ingles is expanding nicely, not too fast, and margins still are pretty thin and have lots of room to grow. Once the company gets more settled in, margins will most likely expand.

No analysts are following the stock, and I think a P/E near 25 is too low considering the amazing rate earnings are growing at.

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