SOY.TO - Watch For Low To Mid 4's

Chart as of Oct. 8, 2005

Current Price
$5.32 Cdn

Company
SUNOPTA INC.
Processing and packaging of organic food products and other non-genetically modified food products, particularly soy milk and products made with soy, oat, and corn. Processing and distribution of abrasives for industry. Sourcing of specialty sands and garnets for the water filtration industry. Development and sale of machinery utilizing steam explosion technology for the processing of wood chips, sugar cane bagasse, cereal straws, waste paper and other materials in order to separate them into their constituents.

What Am I Watching?
Sunopta's main business is organics (a growing industry), and yet, it's been one of the worst performing stocks on the TSX in the past 2 years. It's hard to say why, but from what I've read, they have acquired a large number of business in teh past copule of years and have struggled to integrate them. High energy costs can't be helping much either. And this article talks about how the fading low-carb craze has also hurt them. I would like to see them simplify their business and not be into so many different things.

But for some reason I keep thinking they might be worth a shot. The stock has traded as high as $9.75 in the past 12 months and $14+ in the past 24 months. I figure eventually they'll get around their integration issues and find some cost savings. Plus the CBC article (see link in last paragraph) saids they are getting into ethanol production, which has suddenly made economic sense with the high price of crude. And even in the face of all this bad news, they're still currently turning a small profit.

Sunopta is due to report their 3rd quarter in early November, so I'm thinking if the stock continues to tank to the $4.25-$4.50 range before that, it could be a good gamble.