Lancaster Colony Corporation

Lancaster Colony Corporation (LANC - Snapshot Report) recently announced fiscal fourth-quarter earnings of $1.01 per share, coming in well ahead of the previous year’s 37 cents and exceeding the Zacks Consensus Estimate by 33%. Lancaster also recently declared a quarterly dividend 28.5 cents per share, which translates into an industry-leading yield of 2.3%.

Company Description

Lancaster Colony Corporation manufactures and markets specialty foods as well as glassware and candles for the retail and foodservice markets. Specialty Foods and Glassware and Candles are the company’s 2 segments, each operating autonomously and focusing on their specific customer base and market opportunities.

The Specialty Foods segment offers such items as T. Marzetti salad dressings, Jack Daniel’s mustards, Romanoff caviar, New York garlic bread and Reames egg noodles to a few. The Glassware and Candles product offerings include Candle-lite candles and Lancaster Colony Commercial Products.

Solid Earnings

The company recently announced fiscal fourth-quarter earnings of $1.01 per share, coming in well ahead of the previous year’s 37 cents and exceeding the Zacks Consensus Estimate by 33%. Fourth-quarter sales jumped 7% year-over-year to $253 million.

Management noted that the company continued to see favorable trends in the fourth quarter that allowed its Specialty Foods segment's operating margin percentages to return closer to historical levels. “We were also pleased with the fourth quarter upswing in candle sales, which we believe acknowledges our ability to deliver a high-quality selection of value-priced products," said Chairman and CEO John B. Gerlach, Jr.

Solid Income

Lancaster also recently declared a quarterly dividend 28.5 cents per share, noting that it is payable Sept 30 to shareholders of record on Sept 10.

The dividend translates into an industry-leading yield of 2.3%.

Higher Zacks Consensus Estimates

Analysts polled by Zacks are bullish on earnings. For the year ending June 2010, the Zacks Consensus Estimate of $3.30 per share climbed from last month’s $3.04. For the following year, forecasts of $3.51 are above last month’s $3.07.

Stellar Fundamentals

Lancaster’s balance sheet looks good, showing no debt. The company offers a return on equity (ROE) of 22%, nearly doubling the industry average of 12%. The company’s net profit margin of 8.5% tops the industry average of 3%.

Read the full analyst report on LANC