Hormel's EPS In Line, Revs Beat - Analyst Blog
August 23 2012 - 5:45AM
Zacks
Hormel Foods Corporation
(HRL) posted earnings per share of 41
cents in the third quarter of 2012, in line with the Zacks
Consensus Estimate. The quarter’s earnings also increased 14% from
36 cents per share reported in the prior-year period.
Net earnings reached $111.2
million, up from $98.5 million in the third quarter of 2011.
Net sales for the reported quarter
were $2,008.2 million, up 5.1% year over year and ahead of the
Zacks Consensus Estimate of $1,994 million. The year-over-year
increase reflected sales gain across four of the company’s five
segments.
During the reported quarter,
revenue from Grocery Products improved 21.1% year over year and
Jennie-O Turkey Store witnessed revenue growth of 7.3%. However,
the Refrigerated Foods segment registered a decline of 0.2% in
revenue annually based on lower pork operating margins. On the
other hand, Specialty Foods revenue increased 11.1% while revenue
from all other items crept up 1.8% during the reported quarter.
Operating profit for Grocery
Products for the reported quarter increased 31.6% while
Refrigerated Foods registered a rise of 6.9% year over year.
Operating profit for Jennie-O Turkey Store jumped 12.2%, led by
higher retail value-added sales. Specialty Foods surged 18.5% year
over year.
Gross profit for the third quarter
of 2012 was $307.1 million, up from $297.9 million in the
comparable quarter last year. Selling, general and administrative
(SG&A) expenses were down 7.4% year over year to $145.0 million
in the quarter.
Exiting the third quarter, net cash
provided by operating activities was recorded at $284.1 million
compared with $319.4 million in the year-ago quarter. At the end of
the reported quarter, the company recorded cash and cash
equivalents of $533.2 million, up from $497.4 million at the end of
the comparable quarter last year. Long-term debt (less current
maturities) stood at $250 million at the end of the quarter.
Outlook
Hormel maintained its full-year
earnings guidance of $1.79 to $1.89 per share, anticipating
positive sales momentum and value-added portfolio.
The company paid a dividend of 60
cents on August 15, 2012, representing 336th straight
dividend payout by the company.
Based in Austin, Minnesota, Hormel
Foods Corporation is a leading manufacturer and marketer of various
meat and food products in the United States and internationally.
The company faces stiff competition from ConAgra Foods
Inc. (CAG), Kraft Foods Inc. (KFT) and
Tyson Foods Inc. (TSN).
We currently maintain a long-term
Neutral recommendation on the stock. Hormel has a Zacks #4 Rank,
which translates into a short-term (1-3 months) ‘Sell’ rating.
CONAGRA FOODS (CAG): Free Stock Analysis Report
HORMEL FOODS CP (HRL): Free Stock Analysis Report
KRAFT FOODS INC (KFT): Free Stock Analysis Report
TYSON FOODS A (TSN): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
Kraft (NASDAQ:KFT)
Historical Stock Chart
From Jun 2024 to Jul 2024
Kraft (NASDAQ:KFT)
Historical Stock Chart
From Jul 2023 to Jul 2024