Not long ago, we heard about how the bread price fixing scandal in Canada hit grocery chain Loblaw (TSE:L), and how they responded to same. It was not the only one accused, and now, food maker Maple Leaf Foods (TSE:MFI) is facing an investigation of its own. It denies it has any part in the scandal, but investors have MFI down fractionally in Thursday morning’s trading, against a broadly positive market.
Maple Leaf, for its part, has asserted its innocence in the price fixing scandal, and a hearing has been scheduled to study if it should be added to the class-action lawsuit that is already afoot. Maple Leaf was not included in the original lawsuit, but the plaintiffs in the suit are declaring that since Maple Leaf owns Canada Bread, that should put it squarely in the lawsuit.
It does not exactly help Maple Leaf’s case here that Canada Bread was already fined for four counts of price fixing. However, since Maple Leaf Foods was its majority owner when those counts came down, that prompted the plaintiffs to propose that Maple Leaf should also be a target of the class action lawsuit.
Meanwhile, New Products From Maple Leaf!
Maple Leaf Farms has a new line of breakfast-themed protein products that might help pull some attention away from potential price fixing, and also offer up a good way to start the day. The new items, Breakfast Bites and Schneiders Breakfast Sandwiches, look to offer up a wide range of new options and hopefully a new profit vector for Maple Leaf as a whole.
Breakfast sandwiches include egg and cheddar cheese in every case, but vary by offering ham, pork sausage or bacon as a central feature. One version will put bacon, egg and cheddar cheese on a croissant instead of on an English muffin. Meanwhile, the Breakfast Bites, which look like a small muffin made of scrambled egg and shot through with various additions, will vary much farther. One version involves sausage and three cheeses, while another features red pepper and spinach.
Is Maple Leaf Foods a Good Stock to Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on TSE:MFI stock based on four Buys assigned in the past three months, as indicated by the graphic below. After a 16.48% loss in its share price over the past year, the average TSE:MFI price target of C$30.50 per share implies 37.82% upside potential.
