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Why the Primary Opinion Ltd share price rocketed 80% on Tuesday

Tuesday certainly was a great day for the Primary Opinion Ltd (ASX: POP) share price.

Primary Opinion, owner of a 48% interest in celebrity chef Maggie Beer’s food company, saw its shares rise a staggering 80% on Tuesday to 2.7 cents.

What happened?

Yesterday’s gain was the result of an announcement out of the company which revealed that the ex-CEO of Bellamy’s Australia Ltd (ASX: BAL), Laura McBain, has joined the company as managing director and also as a major shareholder.

According to the release, McBain will commence her position as managing director today and could ultimately hold a 20% stake in Primary Opinion should her options be fully vested.

Should you invest?

Whilst McBain’s time at Bellamy’s may be best remembered for the unexpected and sizeable profit downgrade last year after the infant formula company fell from grace in China, it is worth remembering that she did turn a small Tasmanian outfit into a billion-dollar company.

Whether or not she can do the same with Primary Opinion is of course another question. The Maggie Beer brand is undoubtedly a strong one in Australia, but whether there is a global market opportunity for the brand only time will tell.

So for now I would suggest that investors keep Primary Opinion on their watchlist and wait to see how the business develops over the next couple of years.

In the meantime I would suggest investments in other food companies such as Collins Foods Ltd (ASX: CKF) or Domino’s Pizza Enterprises Ltd. (ASX: DMP).

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Motley Fool contributor James Mickleboro owns shares of Collins Food. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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