January 13, 2021
Today is National Gluten-Free Day. In a trend that began in the early 2000s, more Americans are eschewing this protein found in rye, wheat, barley, and certain other grains. This is often due to allergies, celiac disease (an immune disorder in which people can’t eat gluten because it will damage their small intestine) or simply dietary preferences.
The rise in demand for gluten-free alternatives for bread, cakes, cookies, rolls, snack bars, breakfast cereals, flours, noodles, buns, and ready-to-eat meals created a market estimated at $5.6 billion in 2020 that is expected to grow at a compound annual growth rate of 8.1% by 2025. And there is no shortage of companies who have products lined up to meet this growing consumer demand. Let’s take a look at a few of them.
Kellogg Company (Tii:K)
Kellogg has been making breakfast cereals, bars, and waffles since its founding in 1906. The company has gluten-free product lines under its Kashi and Bear Naked brands. Also, their Special K chewy nut bars are considered gluten-free. While the company tried to create its iconic Rice Krispies breakfast cereal without gluten, their restricted manufacturing processes and low sales forced management to abandon this endeavor. Yet that has not dampened Kellogg’s financial performance as better-than-expected results for the company’s third-quarter ended October 29, 2020, prompted Kellogg to raise its year-end organic net sales projections from an increase of 5% to 6%.
General Mills Inc. (Tii:GIS)
General Mills is an enormous food company that consumers associate with breakfast cereals such as Cheerios and Lucky Charms, both of which have gluten-free versions. The company also has a sizeable gluten-free lineup under its Yoplait brand. Yoplait original yogurt, light yogurt and whip yogurt are all gluten-free. You can also find General Mills Larabar wellness bars with gluten-free alternatives. The branded consumer foods manufacturer is also benefiting from current COVID-related eating trends, reporting 7% higher net sales for its fiscal second quarter ended November 29, 2020, on greater eat-at-home food demand.
Hain Celestial Group Inc. (Tii:HAIN)
While the company name may not ring any bells, its brands of teas and veggie straw snacks are enjoyed by people of all ages. Hain Celestial Group offers such gluten-free products as Celestial Seasonings brand teas, Garden Veggie straws, Dream Almond Milks, Terra vegetable chips and others. When you need a quick snack that is entirely natural and organic, the Hain Celestial Group offers a wide variety of products. The company has seen a solid year in the market, with its shares up 56% over the last 12 months.
Kraft Heinz Company (Tii:KHC)
Kraft Macaroni & Cheese has had a storied history over its more than 80 years in the marketplace and now enjoys a spot in millions of pantries across North America. Kraft Heinz Company has jumped on the bandwagon, offering a gluten-free recipe for this classic comfort food back in November 2020. Not to be outdone, Nabisco, a subsidiary of Kraft before it was split off in 2012 to create Mondelez International, Inc. (Tii:MDLZ), announced that its famous Oreo brand of cookies would offer gluten-free options in 2021.
B&G Foods, Inc. (Tii:BGS)
B&G Foods has taken steps to increase awareness about celiac disease. The Parsippany, NJ-based holding company for branded foods teamed up with the Celiac Disease Foundation to promote greater awareness while offering gluten-free products. The company’s gluten-free lineup includes all Ortega brands of Mexican food products, Emeril’s’ salad dressings and pasta sauces, Joan of Arc variety of beans, and many others.
As you observe National Gluten-Free Day – and even if you don’t plan to observe – it may be worth looking at some of the stocks of companies repositioning their product lines to cash in on growing consumer trends. It may bring about a healthier investment portfolio.
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