Home » Behavioural Investing » JM Smuckers Dividend May Be in Danger #BlackSwan Event Comes From Diabetes Epidemic $SJM $MCD

JM Smuckers Dividend May Be in Danger #BlackSwan Event Comes From Diabetes Epidemic $SJM $MCD

English: Smuckers sign

English: Smuckers sign (Photo credit: Wikipedia)

JM Smuckers (NYSE:SJM) is starting to get some financial press about what a great dividend stock it is. Trading at near its 52 week high the dividend yield is about 2.3%. But wait the pundits point out the dividend has increased smartly and may be expected to do the same in the near future.

A little analysis is thrown in about how well positioned it is because of low coffee prices and how well it does in other products such as peanut butter, jams, lards, baking mixes, frostings. About half their gross income comes from sugars and carbs.

If you follow pharma or maybe read a thing or two about Obama Care and health care costs you can only be painfully aware of the obesity and diabetes epidemic that engulfs America and much of the western world.

So about 50% of the Smuckers dividend is earned at creating obesity and diabetes. We all know officially the Board of Directors never approved that business model in so many words. But that is how the arithmetic shapes up.

America is under siege with poor nutrition. More Americans are becoming interested in healthy eating habits. So if you want some quick dividend analysis the sugar and carbs offerings is going into a Black Swan scenario soon.

Quick service restaurants such as MacDonald’s (NYSE:MCD) have come out with salad offerings only because of public pressure. Smuckers is nowhere near attempting something healthy. This humpty dumpty has financial cholesterol. You don’t feel it until the stroke and then its too late.

George Gutowski writes from a caveat emptor perspective. Follow him on twitter@financialskepti or his evil twin who is writing a Wall Street murder thriller at twitter@georgegutowski