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Food Stocks Reporting Earnings on Feb 23: HRL, SAFM & More

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The fourth-quarter earnings season is in its last leg with 411 S&P 500 companies having already reported results as of Feb 17. The earnings season has provided a favorable picture so far. We notice that the top- and bottom-line growth is on track to reach a new quarterly record.

Per the Earnings Preview (dated Feb 17, 2017), earnings for the total S&P 500 companies is expected to witness an upside of 7.4% from the year-ago period, with total revenue rising 3.9%.

Per the report, out of the companies that have come up with their quarterly numbers, around 68.9% posted positive earnings surprises, while 54.7% beat top-line expectations. Total earnings for these members increased 8% from the year-ago quarter, while revenues are up 4.9%.

However, the performance of the index is not restricted to a single sector. Notably, out of the 16 Zacks sectors, four are expected to witness an earnings decline. Of these, Transportation, Autos and Conglomerates are likely to be the major drags.

Performance of Consumer Staples has remained fairly good this season. As of Feb 17, 90.6% of the S&P 500 companies in this sector have reported results, recording 11% rise in earnings and 3.5% upside in revenues on a year-over-year basis.

We predict that earnings of all the Consumer Staples stocks in the S&P 500 Group would witness 10.3% year-over-year growth. However, revenues are expected to climb 4.1%, over the same time frame.

Food stocks form part of the consumer staples sector. Let’s probe deeper to know more about the following food stocks which are lined up for earnings releases on Feb 23.

What’s in Store for these Four Food Stocks?

Hormel Foods Corporation (HRL - Free Report) is slated to report first-quarter fiscal 2017 (ended Jan 31, 2017) results before the opening bell. The company has delivered a positive average earnings surprise of 6.30% over the four trailing quarters. However, our proven model does not conclusively show that Hormel Foods would beat estimates in this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or at least 3 (Hold) for an earnings beat. That is not the case here as we will see below.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Hormel Foods currently has an Earnings ESP of -2.17%. This is because the Zacks Consensus Estimate of 46 cents is above the Most Accurate estimate of 45 cents.

The company presently carries a Zacks Rank #2.

Hormel Foods Corporation Price and EPS Surprise

 

Hormel Foods Corporation Price and EPS Surprise | Hormel Foods Corporation Quote

The company predicts that stronger sales and lower operational costs would bolster its results in the to-be-reported quarter. However, certain headwinds in the market might weigh on the top- and bottom-line performance (read more: Hormel Q1 Earnings: What's in Store for the Stock?).

Pinnacle Foods Inc. is set to report fourth-quarter 2016 results, before the market opens. The company has delivered a positive average earnings surprise of 2.09%, over the last four quarters. However, our proven model does not conclusively show that Pinnacle Foods would beat estimates in this quarter. This because the company has an Earnings ESP of 0.00% and a Zacks Rank #2.

Pinnacle Foods, Inc. Price and EPS Surprise

 

Pinnacle Foods, Inc. Price and EPS Surprise | Pinnacle Foods, Inc. Quote

You can see the complete list of today’s Zacks #1 Rank stocks here.

Most Accurate estimate for the stock is in line with the Zacks Consensus Estimate of 79 cents.

The company is poised to grow on the back of strategic innovations, product portfolio solidification, new acquisitions and greater operational efficacy. However, certain negative factors such as input price inflation and currency headwinds might hurt results in fourth quarter  (read more: Pinnacle Foods Q4 Earnings: What Factors Are at Play?).

B&G Foods, Inc. (BGS - Free Report) is set to report fourth-quarter and full-year 2016 results, after the market closes. The company has delivered a positive average earnings surprise of 12.16%, over the last four quarters. However, our proven model does not conclusively show that B&G Foods would beat estimates in this quarter.

The company has a Zacks Rank #3 but its Earnings ESP of 0.00% makes surprise prediction inconclusive. Most Accurate estimate for the stock is in line with the Zacks Consensus Estimate of 41 cents.

B&G Foods, Inc. Price and EPS Surprise

 

B&G Foods, Inc. Price and EPS Surprise | B&G Foods, Inc. Quote

The company anticipates that meaningful business buyouts would continue to boost its revenues in the quarter. However, sluggish consumer spending in North American food market remains a major cause of worry (read more: B&G Foods to Report Q4 Earnings: What's in Store?)

Sanderson Farms, Inc. is slated to report first-quarter fiscal 2017 (ended Jan 31, 2017) results before the opening bell. The company has delivered a positive average earnings surprise of 37.37% over the last four quarters. However, our proven model does not conclusively show that Sanderson Farms would beat estimates this quarter.

It currently has an Earnings ESP of -3.28 as the Zacks Consensus Estimate of $1.22 stands above the Most Accurate estimate of $1.18.

The company presently carries a Zacks Rank #3. This when combined with a negative ESP, makes surprise prediction difficult.

Sanderson Farms, Inc. Price and EPS Surprise

 

Sanderson Farms, Inc. Price and EPS Surprise | Sanderson Farms, Inc. Quote

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