Costco Hot Dog: Company That Helps Keep It at $1.50 Is Now a Publicly Traded Stock - Barron’s

TLDR: $MFP small caps <2bn spun off this last week.

The $1.50 Costco Hot Dog Is Made Possible Thanks to This Little Company
By Al Root

Updated July 07, 2026 4:38 pm EDT / Original July 07, 2026 9:06 am EDT

https://www.barrons.com/articles/costco-hot-dog-midera-stock-spinoff-b0064327

The Costco $1.50 hot dog is a cultural phenomenon, and thankfully one of the things Americans can rely on in the era of higher post-Covid inflation.

Now, the company responsible for keeping the iconic combo at a buck 50 is publicly traded.

Monday, food equipment company Middleby
completed the spinoff of its food processing business, Midera Food Processing. And on Tuesday, Midera stock began trading in a regular manner under the symbol MFP.

Midera makes grinders, mixers, blenders, ovens, and automation products for the food industry, including equipment to make Costco hot dogs.

“How did Costco keep that hot dog price? Well, they use Midera equipment,” says Midera CEO Mark Salman. Applying automation and technology to the process is a “perfect example” of how his company helps its customers, and ultimately consumers.

Midera shares had been trading on a when-issued basis for a few days. Shares of spin-offs often trade ahead of the actual spin-off to help investors gauge pricing. Volumes, however, are typically low. Midera traded tens of thousands of shares a day. Middleby typically trades hundreds of thousands of shares a day.

Midera shares gained 3.1% on Tuesday, closing at $36.60.

Shareholders get one share of Midera for every share of Middleby held, giving the new company about 45 million shares outstanding and a market value of $1.6 billion.

Including some limited debt, that values Midera at roughly 11 times estimated 2026 earnings before interest, taxes, depreciation, and amortization, or Ebitda. That’s not too expensive. The S&P 500 trades for about 15 times. Middleby trades for about 13 times.

The discount probably boils down to newness and not growth. Through 2028, Midera targets 5% to 7% annual sales growth, 5 percentage points of margin expansion, with additional growth from M&A.

Organic sales growth expectations are in line with recent history, and growth is helped by health and wellness trends. Food produced with higher-quality ingredients, closer to final consumption by consumers, generally requires more expensive equipment.

The M&A opportunity is key to why Middleby decided to spin out its food processing division. The top five companies, which include JBT Marel, account for only about 10% of the annual market, which totals roughly $70 billion. The market isn’t all new equipment either. Parts and service account for about 40% of Midera’s sales.

The small stock looks like a solid opportunity for investors. It’s cheaper than JBT, which trades for about 13 times estimated 2026 Ebitda, and management just needs to demonstrate it can deliver on its promises.

If they can deliver, Midera will become known for more than just Costco hot dogs.

Fin