Invest in Hilton Foods: a tasty UK food supplier
Hilton Foods is a keenly priced opportunity in an unglamorous sector


Sometimes the best opportunities aren’t in the most glamorous sectors but in less prominent, yet still important, industries. Take food supply-chain management. It may not be a sector you think about every day, but without it, supermarkets would not be able to source, store and sell the wide range of foods that are available, nor would their customers be able to store them until they are needed. One British company that is making a name for itself in this area is Hilton Food Group (LSE: HFG).
Hilton Foods’ business involves sourcing, processing and packaging food that is then sold in many of the UK’s major supermarkets, including Tesco, Morrisons and Waitrose. While its core focus is meat, Hilton has expanded its range of activities over the past few years, using acquisitions to grow its seafood operations, for instance. It has also bolstered its presence in the growing area of vegetarian food, as well as in ready meals.
Like most of the food industry, Hilton was hit by the surge in inflation, which squeezed margins, with the result that profits nearly halved in 2022, leading to a sharp fall in its share price around the same time. However, the good news is that the stock bounced back in 2023 and has continued to grow strongly. Part of this is due to the fall in inflation, but profitability has also been boosted by a successful effort by the company to clamp down on costs.
MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Hilton Foods plans to go global
In the longer run, Hilton Foods has ambitious international expansion plans. It already operates in several European countries, including Denmark, Holland, Sweden, Portugal, Ireland and Greece, as well as Australia and New Zealand. However, it is now starting to move into North America. Last September it signed an agreement with Walmart, whereby Hilton will assist the supply chain of the supermarket giant’s Canadian arm from 2027. This is a big deal, as Walmart controls just under 10% of the Canadian market; it could also lead to deals elsewhere.
Hilton Foods’ expansion plans (including acquisitions) have already resulted in sales more than doubling between 2018 and 2023. At the same time, the group makes a return on capital employed, a key gauge of profitability, of about 13%, showing that it is deploying its resources in an efficient manner. This makes a valuation of 14.5 times 2025 earnings seem more than reasonable. The stock also comes with a solid dividend of 3.8%.
Not only are Hilton Foods’ fundamentals and prospects both strong, but it also seems to have caught the imagination of investors from a technical perspective – the shares have nearly doubled in two years. The momentum seems to be enduring, as the shares are now above both their 50-day and 200-day moving average. I therefore suggest you go long at the current share price of 918p at £3 per 1p. Put the stop-loss at 618p, giving you a total downside of £900.
This article was first published in MoneyWeek's magazine. Enjoy exclusive early access to news, opinion and analysis from our team of financial experts with a MoneyWeek subscription.
Get the latest financial news, insights and expert analysis from our award-winning MoneyWeek team, to help you understand what really matters when it comes to your finances.

Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.
He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.
Matthew is the author of Superinvestors: Lessons from the greatest investors in history, published by Harriman House, which has been translated into several languages. His second book, Investing Explained: The Accessible Guide to Building an Investment Portfolio, is published by Kogan Page.
As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.
Follow Matthew on Twitter: @DrMatthewPartri
-
Wallester Business: Simplify financial workflows with unlimited corporate cards
Make messy expense reports and card sharing chaos a distant memory with Wallester Business, an all-in-one corporate card and expense management platform
-
How to sell a property that floods – ways to avoid a 31% hit to your asking price
Flood risks can knock up to a third off the value of your home when you come to sell but there are ways to soften to blow
-
Small UK industrial stocks are hidden gems
Opinion Ed Wielechowski of the Odyssean Investment Trust highlights three of his favourite British small-cap industrial stocks
-
Aurora Innovation is running on empty – is it overvalued?
Aurora Innovation, a maker of self-driving trucks, may have promised far more than it can deliver
-
'Ride the recovery in emerging markets': Gustavo Medeiros of Ashmore Group tells MoneyWeek
Interview What's the outlook for emerging markets? Gustavo Medeiros, head of research at Ashmore Group, gives his analysis and reviews progress in developing economies
-
What is the Enterprise Investment Scheme and should you have one?
The Enterprise Investment Scheme is tax-efficient and potentially lucrative. Taking a chance on the scheme could trim your family’s IHT bill, says David Prosser
-
The alcohol industry is suffering as consumers sober up – is it still worth investing in the sector?
Changing consumer tastes are rocking the alcohol industry, but the best players are adapting their strategies. Buy them while their shares are still cheap
-
A strange calm in credit
Corporate bond markets remain remarkably relaxed, with yields that offer little compensation for risks
-
'The City's big bet on green finance fails to pay out'
Opinion Insurers and banks are backing away from “green finance”, and there is not much sign of the green boom we were promised. That’s a problem for the City
-
Six top investment trusts for smaller stocks
Liquidity constraints mean investment trusts are best placed to seize the juiciest opportunities