Bear Stearns: Dean Foods/Suiza Foods still attractive after run-up

By Ronda Fears

Nashville, Tenn., Aug. 6 - Even though the Dean Foods/Suiza Foods convertible preferred has bounced strongly with the common stock recently, Bear Stearns & Co. analysts say it's still an attractive way to play a defensive name.

Since the Bear Stearns convertible analysts recommended the issue two weeks ago, the common stock has run-up 15.5% and the 5.5% convertible preferred 11%.

"We still like the story and expect positive news on the earnings report" due Thursday, said Bear Stearns convertible analyst Matt Hempel in a note Tuesday.

He said Bear Stearns stock analyst Terry Bivens thinks Dean Foods will raise EPS estimates going forward.

"Although the run up has taken out some of the upside in the story, the current yield of 5.75% and the strong equity potential offer an attractive play in a defensive name," Hempel said.

Bear Stearns analysts have a buy recommendation on the Dean Foods/Suiza Foods 5.5% convertible preferred due 2028 on an outright basis or on swap.

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