In this episode of QAV America, Australian value investors Tony and Cam are focusing on Seneca Foods, a classic American company known for its packaged fruits and vegetables. They discuss Seneca’s financial performance, history, and why it’s a compelling value stock despite being considered a boring business. The hosts also reflect on other stocks they have reviewed recently, showing significant gains, and emphasize the ongoing potential to find undervalued stocks in the US market. The podcast aims to apply value investing principles to identify promising investment opportunities.

00:00 Introduction to QAV America
00:57 Success Stories and Market Insights
04:34 Highlighting Seneca Foods
05:33 Seneca Foods: History and Operations
13:00 Challenges and Financial Performance
19:15 Competitive Advantages and Industry Overview
20:21 Financial Performance Analysis
21:35 Cash Flow and Investment Strategy
24:05 Stock Performance and Market Sentiment
28:59 Seneca’s Historical Context
32:57 Investment Opportunities in the US Market
37:03 US Portfolio Performance
38:57 Disclaimer and Transparency

Cameron: [00:00:00 ] Welcome back to QAV America. Tony, this is, uh, for new listeners. Welcome. We’re two Australian value investors talking about the American market. We’ve been talking about the Australian market for years. We’re like, let’s broaden our horizons. Let’s, let’s start investing in American stocks as well and applying value investing principles.

So each week on the show, we take a stock. That’s on our US buy list, and I do a deep dive into it. Let’s try and figure out why it’s turning up in our buy list, as we call ’em a pulled pork. But, uh, how have you been, Tony, since we last spoke 20 seconds ago?

Tony Kynaston: Thank you. Are we called QAV

Cameron: I,

Tony Kynaston: now? Is that, do we have to change our name? it’s no longer the Gulf of,

Cameron: yeah.

Tony Kynaston: it’s, or QAV.

Cameron: Yeah.

Tony Kynaston: QAV

Cameron: Well, originally we were, yeah, we were QAV Mexico, but then Trump said we had to change it to QAV America. Tony, a couple of weeks ago on this here [00:01:00 ] podcast, I did a deep dive on a company called Zep, Zep Health, Chinese Smartwatch Company. Within days of me publishing that their share price jumped up 400%.

Um, so I’m not saying I’m a genius. But, um,

Tony Kynaston: It’s

Cameron: some people say I’m the greatest genius who ever lived, so that was an interesting one. Um, they have. The this, this smartwatch technology that we talked about sounded pretty good, but apparently within a few days of me publishing that they came out and said that they expect the 30% year over year revenue growth growth for the second quarter of 2025.

This would be their first revenue increase in three years, and it was seen as a big turnaround. We did talk a lot in the Paul [00:02:00 ] pork about. Some of the structural things that they were doing and changing their branding. And, uh, they’ve also apparently signed a couple of prominent athletes, NFL running back, Derek Henry and Ultra Runner Rod Fava as brand ambassadors for a maze fit one of the brands that they market under.

On Amazon, which as I said, makes you think that it’s associated with Amazon, but it’s not. It’s just something they sell on Amazon anyway, so we don’t hold them.

Tony Kynaston: they had, low point price points, I think too, didn’t they? Which was their, one of their big

Cameron: Very low. Yeah. We don’t hold them, uh, in our portfolio. I wish we did, but our portfolio was full. We didn’t have any capital left to allocate to them or I would’ve bought them, but I did. Uh, the reason I found this out is I put together a spreadsheet just tracking the stocks that, uh, I’ve done a pulled pork on that we don’t hold in our official portfolio.

[00:03:00 ] And, uh, they’ve, some of them have done really well. Um, CX is up 49% since we talked about it at the end of March. That one Z is up 361% since we talked about ’em on the 11th of July. Some of the other big ones are Poco Holdings. Remember them? There was on the 1st of July. They’re up 20% since we talked about them on the 1st of July.

Precision Drilling Corporation we did at the end of June. They’re up 12% IHS holdings we did at the end of May. They’re up 18% Canadian Imperial and Bank of Commerce is up 16%. Uh, Dan OS Corporation is up. 13% Greek shipping company. The one that hasn’t done as well was NL Chile. It’s down 20% since we covered them in May, but the rest are all doing quite well since we’ve covered ’em on the show, which.

Is, you know, all jokes aside, just evidence of a couple of things. [00:04:00 ] Number one, the US market is kind of bonkers at the moment, so I think a lot of things are doing well over there. But also, you know, we are picking stocks that are, um, undervalued, doing good businesses that are undervalued, so we expect them to do well over time.

Tony Kynaston: and if you, I mean, it’s a kind of almost like a law of physics if you give. A lot of cash to good managers. They’re gonna invest it wisely and make money for shareholders. So, uh, that’s

Cameron: You hope?

Tony Kynaston: you hope. Yeah. All things being

Cameron: You hope?

Tony Kynaston: should happen. Yeah.

Cameron: Well, the stock that I’ve got for this week, Tony, is unusual in a couple of ways. Number one, it’s a NASDAQ stock. I think I said in last week’s show. We don’t tend to.

Tony Kynaston: Can you, whisper it to me before you announce it so I can. a four bagger this week. No, we don’t front run stocks. We should say that. We don’t. We don’t

Cameron: Yeah. What have you done?

Tony Kynaston: it. Yep.

Cameron: No, uh, it might be one of the ones that goes down 20% too. You dunno. [00:05:00 ] It’s a NASDAQ stock. We said last week that, you know, we don’t tend to get NASDAQ stocks a lot on our buy list. Technology stocks tend to be way too expensive for us, but this, for whatever reason, is an NASDAQ stock.

It’s also sort of a classic Berkshire type stock. Hmm.

Tony Kynaston: find it on the nasdaq, isn’t it? It’s, I couldn’t see the

Cameron: I dunno why it’s on the nasdaq.

Tony Kynaston: and this company. Yeah.

Cameron: No. Well, maybe when it floated back in 1995 it was. Anyway, the company is Seneca Foods, and I think if you’re a North American listener of this, you probably know Seneca Foods. I asked Chrissy, my American wife, Hey, you know Seneca Foods. She was like, yeah, of course. I was like, okay. Um, they, they distribute all around the world too, so I’m pretty sure we’ve bought.

Seneca Products had them here, but [00:06:00 ] they’re a, they’re a classic American company. Been around since 1949. Big into canning and food packaging. So beans, corn, fruit. Um. Anything that needs packaging. They’re the kings of packaging food and they’ve acquired a lot of different companies over the years. They’ve been around, but it’s, it’s, it’s like one of those classic Berkshire type businesses, unlike a lot of the companies that we’ve talked about in the last.

Few months, you know, like weird fracking operations and, and walking, um, oil wells and, and, and mobile phone towers in South Africa and smart watches in China, et cetera, et cetera. This is a boring food manufacturing business. And as I just said to you on an Australian show, I did have a question for you about it ’cause it is a little bit unusual.

It’s cashflow. Tri is a little bit unusual, but we’ll get to that [00:07:00 ] later. So their website, by the way, their tagline on their website is Farm Fresh Goodness made Great. I dunno if that’s a MAGA add-on. They’re making farm fresh food great again, or if they’ve had that pre maga, not sure

Tony Kynaston: Uh.

Cameron: but. The founding of it is a good story.

Founded in 1949 by a guy called Arthur Walcott, art Walcott, who had just graduated from doing a degree in, uh, business and economics at Cornell University in New York. He went to an auction in Dundee, New York. Uh, actually hadn’t graduated. He was a Cornell senior. He was looking for a good deal on a typewriter.

He ended up buying a bankrupt grape juice plant instead, which apparently did own at least one [00:08:00 ] typewriter. So you buy the bankrupt company and you get the typewriter thrown in kind of dea