Food products giant, ConAgra Foods Inc. (CAG - Free Report) , recently revised its previously announced guidance for fiscal 2014. ConAgra now expects adjusted earnings per share for fiscal 2014 in the range of $2.34 to $2.38, lowered from the previously announced $2.40. The new estimate represents an 8% to 10% hike over the $2.16 adjusted earnings per share reported in fiscal 2013.
This move by the company comes after the lower-than-expected fiscal first-quarter 2014 earnings. ConAgra generated earnings per share of 33 cents in the quarter. Adjusted earnings per share are expected to be 37 cents. The company’s weakness in the Consumer Foods segment has been held responsible for the decline.
ConAgra’s Consumer Foods segment reported year-over-year improved results in the fourth quarter of fiscal 2013, with revenues increasing 7%. The segment experienced strong organic revenue growth in the quarter, which was strengthened by the acquisitions undertaken. However, in fiscal first-quarter 2014, the segment was badly hit by difficult situations for some branded retail categories and some customers, due to challenging industry conditions. This led to a reduction in total volume for the segment on a year-over-year basis.
However, ConAgra is trying to better the situation as the fiscal year progresses. The company is working on its merchandising, promotion and pricing strategies for the retail customers along with keeping a tight check on the total costs. However, the other financial strategies of the company, like the reduction of debt or the integration of Ralcorp Holdings, remain unchanged.
ConAgra expects to release its full fiscal first-quarter 2014 results on Sep 19, 2013.
ConAgra currently carries a Zacks Rank #3 (Hold). Other stocks worth a watch in the industry include Green Mountain Coffee Roasters, Inc. , Pinnacle Foods Inc. (PF - Free Report) and Boulder Brands, Inc. . While Green Mountain Coffee Roasters and Pinnacle Foods carry a Zacks Rank #1 (Strong Buy), Boulder Brands carries a Zacks Rank #2 (Buy).