Join        Login             Stock Quote

Will Conagra Foods (CAG) Q3 Earnings Top Expectations?

 March 21, 2012 02:51 PM

ConAgra Foods (NYSE: CAG) will announce its third-quarter earnings results on March 22 before the market opens. On February 21, the packaged foods maker backed its 2012 earnings outlook. However,  CAG's  movement after second-quarter results does not provide a positive picture for investors.

Worldwide food inflation has put pressure on company's margins. This is because raw materials cost and fuel charges have increased during the last few months. Additionally, consumers seem to prefer low-cost private labels in order to bring down their spending. This is likely to have some impact on the company's performance.

[Related -9 Stocks That Have Paid Dividends For Over 100 Years]

In anticipation, analysts have reduced their earnings estimate on ConAgra Foods to 49 cents a share for the third quarter, down from 51 cents a share in the last 30 days. Three months ago, the consensus was 52 cents a share.

In the past four quarters, actual results have been mixed. ConAgra's earnings failed to meet analysts' estimations in two quarters and came in above expectations in the other two quarters.

Currently, Wall Street is predicting the company will deliver earnings of 49 cents a share on revenues of $3.35 billion. This represents earnings downside of two percent despite sales projected to increase 6.10 percent. Last year, the company earned 50 cents a share on revenues of $3.15 billion.

Perhaps foreshadowing CAG's fate, on March 21st, industry peer General Mills (NYSE: GIS) reported third quarter earnings results below expectations. The shortfall was blamed on a fall in gross margins despite sales growth of 13 percent.

[Related -General Mills, Inc. (GIS) Dividend Stock Analysis]

For the second quarter, ConAgra Foods reported net income of $171.8 million, down from $200.9 million, and earnings slipped to 41 cents a share from 45 cents a share in the year-ago quarter. On an adjusted basis, earnings increased to 47 cents a share from 45 cents a share in the previous year.

Net sales were $3.4 billion, 8 percent higher than $3.15 billion in the previous year's second quarter. Street analysts' were expecting the company to report earnings of 43 cents a share on sales of $3.3 billion.

During the last four quarters, ConAgra Foods earned 47 cents a share, 29 cents a share, 47 cents a share and 50 cents a share respectively.

For the fourth quarter, analysts have increased their earnings projections to 54 cents a share from 53 cents a share. However, for fiscal 2012, Street analysts have reduced their EPS estimation to $1.79 a share from $1.81 a share within the last 60 days.

On the other hand, the company has reaffirmed its fiscal 2012 earnings outlook of mid-single digit growth from $1.75 a share reported for fiscal 2011.

As many as nine analysts' are recommending investors to Hold the stock, while three analysts' have rate CAG a Strong Buy. One analyst terms the stock as Underperform. During the 52-week period, the stock ranged between $22.20 and $27.34. Today, shares of the CAG are trading between $26.26 and $26.41.

iOnTheMarket Premium


Post Comment -- Login is required to post message
Alert for new comments:
Your email:
Your Website:

rss feed

Latest Stories

article imageThe Soda Industry Is Dying - But PepsiCo Will Thrive

Although diet crazes come and go, one trend has become clear: Americans are drinking less soda. Per-capita read on...

article imageDefensive Sectors Lead Hesitant Market, But Traders Honor Long-standing Bullish Support

Last week, the major indexes fell back below round-number thresholds that had taken a lot of effort to read on...

article imageWill Janet Yellen's Outlook Prevail?

Federal Reserve Chairwoman Janet Yellen told the crowd last week that rate hikes are coming. The rise will read on...

Popular Articles

Daily Sector Scan
Partner Center

Fundamental data is provided by Zacks Investment Research, and Commentary, news and Press Releases provided by YellowBrix and Quotemedia.
All information provided "as is" for informational purposes only, not intended for trading purposes or advice. iStockAnalyst.com is not an investment adviser and does not provide, endorse or review any information or data contained herein.
The blog articles are opinions by respective blogger. By using this site you are agreeing to terms and conditions posted on respective bloggers' website.
The postings/comments on the site may or may not be from reliable sources. Neither iStockAnalyst nor any of its independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. You are solely responsible for the investment decisions made by you and the consequences resulting therefrom. By accessing the iStockAnalyst.com site, you agree not to redistribute the information found therein.
The sector scan is based on 15-30 minutes delayed data. The Pattern scan is based on EOD data.