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All You Need to Note Before B&G Foods' (BGS) Q3 Earnings
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B&G Foods, Inc. (BGS - Free Report) is likely to report an increase in the top and bottom lines when it releases third-quarter 2020 numbers on Nov 5, after the closing bell. The Zacks Consensus Estimate for earnings has remained unchanged in the past 30 days at 64 cents per share, which suggests an 18.5% increase from the year-ago period’s reported figure. Notably, B&G Foods delivered an earnings surprise of 14.5% in the last reported quarter. Also, this renowned food company has a trailing four-quarter earnings surprise of 6.9%, on average.
The Zacks Consensus Estimate for revenues is pegged at $454 million, indicating an increase of 11.6% from the prior-year quarter’s reported figure.
Key Factors to Note
The company has been benefiting from consumers’ rising demand amid coronavirus-led increased at-home consumption and pantry loading trends. B&G Foods’ higher net sales to mass merchants, warehouse clubs, supermarkets, wholesalers and e-commerce consumers have more than offset lower demand from Foodservice clients. Incidentally, B&G Foods’ foodservice business remained soft in the second quarter as increased at-home consumption amid the pandemic dealt a blow to away from home or restaurant-related consumption. Management on its last earnings call said that it expects foodservice sales to remain challenged amid the coronavirus-led stay-at-home trends.
Nonetheless, management expects overall sales to remain elevated, thanks to anticipations of continued pandemic-led stay-at-home, work-from-home and cook-at-home trends amid the pandemic. These trends bode well for the quarter under review. Apart from this, B&G Foods has been gaining from higher online sales amid the pandemic. E-commerce sales have been benefiting from efficient delivery services of the company’s retail customers. B&G Foods has been making investments to enhance its e-commerce capacity, as it expects continuation of the solid e-commerce trends.
Additionally, B&G Foods’ buyouts have been yielding results. Evidently, Farmwise (acquired in February 2020) and Clabber Girl (May 2019) made contributions of $0.6 million and $15 million, respectively, to B&G Foods’ second-quarter top line. Apart from this, the company has been particularly benefiting from its Green Giants brand and been especially committed to product innovation and other brand enhancement investments in this category.
However, the company’s SG&A costs have been rising year over year for a while now. Also, the company has been seeing high costs associated with COVID-19, which are related to better sanitization, employee screenings and elevated employee compensations such as temporary wage hikes, special bonuses and continued payments during the quarantine. Management expects elevated costs related to the pandemic, which may have exerted some pressure on margins. Nevertheless, B&G Foods’ robust pricing initiatives and saving actions bode well.
What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for B&G Foods this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
B&G Foods currently has a Zacks Rank #3 and an Earnings ESP of 0.00%.
Stocks With Favorable Combinations
Here are some companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this season.
Tyson Foods (TSN - Free Report) has an Earnings ESP of +9.57% and a Zacks Rank #3.
Hershey (HSY - Free Report) has an Earnings ESP of +2.17% and a Zacks Rank #3.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early. See Zacks' 3 Best Stocks to Play This Trend >>
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All You Need to Note Before B&G Foods' (BGS) Q3 Earnings
B&G Foods, Inc. (BGS - Free Report) is likely to report an increase in the top and bottom lines when it releases third-quarter 2020 numbers on Nov 5, after the closing bell. The Zacks Consensus Estimate for earnings has remained unchanged in the past 30 days at 64 cents per share, which suggests an 18.5% increase from the year-ago period’s reported figure. Notably, B&G Foods delivered an earnings surprise of 14.5% in the last reported quarter. Also, this renowned food company has a trailing four-quarter earnings surprise of 6.9%, on average.
The Zacks Consensus Estimate for revenues is pegged at $454 million, indicating an increase of 11.6% from the prior-year quarter’s reported figure.
Key Factors to Note
The company has been benefiting from consumers’ rising demand amid coronavirus-led increased at-home consumption and pantry loading trends. B&G Foods’ higher net sales to mass merchants, warehouse clubs, supermarkets, wholesalers and e-commerce consumers have more than offset lower demand from Foodservice clients. Incidentally, B&G Foods’ foodservice business remained soft in the second quarter as increased at-home consumption amid the pandemic dealt a blow to away from home or restaurant-related consumption. Management on its last earnings call said that it expects foodservice sales to remain challenged amid the coronavirus-led stay-at-home trends.
BG Foods, Inc. Price and EPS Surprise
BG Foods, Inc. price-eps-surprise | BG Foods, Inc. Quote
Nonetheless, management expects overall sales to remain elevated, thanks to anticipations of continued pandemic-led stay-at-home, work-from-home and cook-at-home trends amid the pandemic. These trends bode well for the quarter under review. Apart from this, B&G Foods has been gaining from higher online sales amid the pandemic. E-commerce sales have been benefiting from efficient delivery services of the company’s retail customers. B&G Foods has been making investments to enhance its e-commerce capacity, as it expects continuation of the solid e-commerce trends.
Additionally, B&G Foods’ buyouts have been yielding results. Evidently, Farmwise (acquired in February 2020) and Clabber Girl (May 2019) made contributions of $0.6 million and $15 million, respectively, to B&G Foods’ second-quarter top line. Apart from this, the company has been particularly benefiting from its Green Giants brand and been especially committed to product innovation and other brand enhancement investments in this category.
However, the company’s SG&A costs have been rising year over year for a while now. Also, the company has been seeing high costs associated with COVID-19, which are related to better sanitization, employee screenings and elevated employee compensations such as temporary wage hikes, special bonuses and continued payments during the quarantine. Management expects elevated costs related to the pandemic, which may have exerted some pressure on margins. Nevertheless, B&G Foods’ robust pricing initiatives and saving actions bode well.
What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for B&G Foods this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
B&G Foods currently has a Zacks Rank #3 and an Earnings ESP of 0.00%.
Stocks With Favorable Combinations
Here are some companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this season.
Purple Innovation (PRPL - Free Report) has an Earnings ESP of +5.82% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Tyson Foods (TSN - Free Report) has an Earnings ESP of +9.57% and a Zacks Rank #3.
Hershey (HSY - Free Report) has an Earnings ESP of +2.17% and a Zacks Rank #3.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>