Jim Cramer on Conagra: "What's Not to Like is That 7.6% Dividend Yield"

Conagra Brands, Inc. (NYSE:CAG) is one of the stocks Jim Cramer was recently focused on. Cramer said that he he would be less concerned when the yield comes down. He stated:

“Tomorrow, Conagra Brands report. Solid brands, right? Birds Eye, Hunt’s, BOOMCHICKAPOP… household names, along with many others, plus the stock yields 7.6%. What’s not to like? Precisely what’s not to like is that 7.6% dividend yield. How can a packaged food company offer you such a great return? It’s because most investors don’t believe they can keep paying that dividend at current levels.

Now, you might be tempted to buy Conagra, it’s a solid company, but I’d rather go for it when it yields 7.6 going to 6 because then I’d be less concerned. If you buy the stock right now, you’re reaching for yield, which is something you should never do because if a dividend gets cut, stock’s going to get hammered no matter what. And let’s not forget when the yield was 5 or even 6, it didn’t stop the stock from going down, did it?”

Conagra Brands, Inc. (NYSE:CAG) produces and markets packaged foods across grocery, frozen, and foodservice categories.

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Disclosure: None. This article is originally published at Insider Monkey.