Hormel Foods Corporation

Hormel Foods Corporation (HRL - Analyst Report), the manufacturer of food and meat products including SPAM, Hormel and Dinty Moore brands, recently raised its dividend for the 44th straight year. The company has been paying a dividend, without interruption, since it went public in 1928.

The annual dividend was raised 10.5% to 84 cents from 76 cents per share in 2009.

On Nov 24, Hormel also surprised on the fourth quarter Zacks Consensus Estimate by 13.24%. Earnings per share rose 54% to 77 cents from 50 cents in the year ago period. The Zacks Consensus called for 68 cents. For fiscal 2009, earnings per share climbed 22% to $2.53 from $2.08 per share.

Sales and volumes both declined, however. Sales fell 10% to $1.68 billion while volumes sank 3% compared to a year ago. The sales decline was due to lower commodity costs which was reflected in lower pricing in the pork and turkey segments as well as a continued weak consumer environment.

On the positive side, the refrigerated foods segment led the quarter as volumes rose 1%.

Outlook for Fiscal 2010

The company provided a 2010 outlook of earnings per share in the range of $2.63 to $2.73.

The analysts are still revising their estimates but the full year Zacks Consensus has already jumped 4 cents to $2.63, which is at the lower end of the company's guidance range. 3 out of 10 covering analysts raised estimates in the last week.

Value Fundamentals

Hormel is now a Zacks #2 Rank (buy) stock. It is trading with a forward P/E of 14.5. Its price-to-book ratio is 2.36. The company has a solid 1-year return on equity (ROE) of 14.73%.

Read the Apr 29 article.

Update to Previous Value Zacks Rank Buy Stocks

Avnet, Inc. (AVT - Analyst Report) recently saw quarter over quarter growth as the global recession eased. The company is trading with a forward P/E of 13.2. Read the full article.

Jinpan International Limited (JST - Snapshot Report) is taking advantage of worldwide interest in wind energy as international sales rose 40% in the third quarter. The company is trading with a forward P/E of 11.67. Read the full article.

Jarden Corporation (JAH - Snapshot Report) has surprised on estimates four quarters in a row by an average of 12.57%. The company is trading with a forward P/E of 11. Read the full article.

Tracey Ryniec is the Value Stock Strategist for Zacks.com. She is also the Editor in charge of the market-beating Zacks Value Trader service.

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