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Kellogg (K) Gains But Lags Market: What You Should Know

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In the latest trading session, Kellogg (K - Free Report) closed at $72.12, marking a +1.48% move from the previous day. This move lagged the S&P 500's daily gain of 3.06%. At the same time, the Dow added 2.8%, and the tech-heavy Nasdaq gained 0.16%.

Prior to today's trading, shares of the maker of Frosted Flakes, Pop Tarts and Eggo waffles had lost 2.24% over the past month. This has was narrower than the Consumer Staples sector's loss of 5.87% and the S&P 500's loss of 6.15% in that time.

Investors will be hoping for strength from Kellogg as it approaches its next earnings release. The company is expected to report EPS of $0.96, down 11.93% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $3.76 billion, up 3.82% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $4.12 per share and revenue of $14.85 billion, which would represent changes of -0.96% and +4.69%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for Kellogg. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.05% higher. Kellogg is currently sporting a Zacks Rank of #3 (Hold).

Digging into valuation, Kellogg currently has a Forward P/E ratio of 17.24. This valuation marks a premium compared to its industry's average Forward P/E of 17.2.

Investors should also note that K has a PEG ratio of 4.21 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. K's industry had an average PEG ratio of 2.5 as of yesterday's close.

The Food - Miscellaneous industry is part of the Consumer Staples sector. This industry currently has a Zacks Industry Rank of 168, which puts it in the bottom 34% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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