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General Mills Inc. (GIS - Analyst Report) recently reaffirmed its previously provided fiscal 2013 guidance at the Consumer Analyst Group of New York (CAGNY) investor conference being held in New York. In addition, the food giant expects growth in 2014 to be in line with its long-term goals.

Fiscal 2013 Guidance Retained

Fiscal 2013 adjusted earnings are expected to range between $2.65 and $2.67. Both sales and operating profit are expected to increase in the mid-single-digit range. More importantly, the guidance includes benefits from the recent acquisition of Yoki in Brazil and Yoplait yogurt business in Canada. Excluding the impact of acquisitions and currency headwinds, organic sales are expected to grow at a low-single-digit rate.

The U.S. retail business is expected to deliver low single-digit sales growth while operating profit is expected to grow faster than sales. International sales are expected to exceed $5 billion in 2013, gaining largely from the Yoki and Yoplait acquisitions.

Outlook for Fiscal 2014

In fiscal 2014, General Mills plans for stronger earnings growth and increased cash returns to shareholders. Growth is expected to be in line with its long-term targets; high single-digit growth in earnings, low-single-digit growth in net sales; mid-single-digit growth in segment operating profit. Acquisitions are expected to add 15 cents to earnings in fiscal 2014.

Moreover, the company plans to increase dividends and share buybacks in the year, thus offering greater shareholder value. The increased buybacks are expected to lower the average number of shares outstanding by 2% in fiscal 2014.

The U.S retail business is expected to benefit from new product launches and increased innovation, while the international business will gain largely from the newly acquired businesses.

General Mills carries a Zacks Rank #3 (Hold). We are encouraged by the company’s strong market share position in some leading food categories, its strengthening international presence, strategic acquisitions and focus on innovation and brand support. These growth initiatives combined with the cost saving efforts bode well for the company’s long-term growth. However, we prefer to remain on the sidelines until the U.S. retail volumes improve substantially, the Yoplait yogurt business delivers and the macroeconomic environment recovers.

Other Stocks to Consider

Some stocks going strong in the food industry are ConAgra Foods, Inc (CAG - Analyst Report), Flower Foods Inc (FLO - Snapshot Report) and J&J Snack Foods Corp (JJSF - Snapshot Report), all carrying a Zacks Rank #1 (Strong Buy).

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