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Pilgrim's Pride (PPC) Gains on Capacity Growth, Mexico Unit
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Prudent operational strategies have been helping Pilgrim's Pride Corporation (PPC - Free Report) to stay afloat amid tough market conditions induced by the pandemic. This well-known fresh and frozen chicken products company is gaining from efforts to expand capacity for key products, robust online sales and prudent marketing strategies. Additionally, solid growth in Mexico and gradual revival of U.S operations have been upsides for the company. Let’s take a closer look.
Efforts to Boost Capacity & Product Offerings
Pilgrim's Pride’s customer centric approach propelled it to come up with unique offerings that provide competitive advantages. In fact, the company’s focus on key customers helps it refine portfolio and create competitive advantages over its peers, especially amid the coronavirus-led disruptions. Management is on track with a number of projects to support growth of its key customers. In this regard, the company is doubling the case-ready capacity in its Cold Spring, Minnesota plant. Also, Pilgrim's Pride is increasing the mix of more stable margin case-ready items and is expanding the manufacturing of Just BARE brand items by 20%. Moreover, it is converting a commoditized large bird deboning plant to effectively support demand.
Apart from this, the company has been steadily augmenting marketing support of its brands, as they expand and enter new regions. Additionally, it resorts to frequent supply chain improvements to enhance efficiency and reduce costs. In this respect, it has been progressing well with developing automation technology for its processing plants. Moreover, the company’s dedicated efforts, including zero-base budgeting and positive impacts from acquisitions, are expected to create synergies. Pilgrim's Pride has also been strengthening its portfolio through innovations. It has been increasing its product mix for organic category, including No-Antibiotics-Ever products, to meet customers' evolving tastes. Moreover, the company continues to see solid growth in online sales, mainly on the back of strength in the case-ready and prepared foods portfolio.
Image Source: Zacks Investment Research
Strong Sales Across Regions
During first-quarter 2021, the company witnessed sales growth across Mexico, the U.K. and Europe as well as the United States, which in turn drove the top-line performance. The company’s Mexican operations gained from normalization of the economic environment, balanced supply/demand scenario and increased share of non-commodity products. Additional, growth in demand for Prepared Foods was an upside. Apart from this, the company’s combined European operations witnessed growth, backed by prudent operational improvements, despite weak foodservice volume due to lockdowns and costs related to the pandemic.
Additionally, the company stated that market conditions in the United Stated improved during the first quarter, despite some challenges related to severe weather in the southeast during February. Moreover, it is seeing recovery in the foodservice business as pandemic-led restrictions are being eased. The company’s retail and QSR business also remained strong on solid demand conditions. U.S. Prepared Foods business continues to gain traction. Also, its market for commodity large bird deboning saw improvements.
Wrapping Up
We expect Pilgrim's Pride to keep gaining from improving market and operational scenarios across markets, as pandemic-led shortcoming gradually subside due to mass vaccination. Shares of this Zacks Rank #3 (Hold) company have increased 16.1% in the past six months compared with the industry’s rise of 8.4%.
Medifast, Inc. (MED - Free Report) , also with a Zacks Rank #1, has a trailing four-quarter earnings surprise of 12.7%, on average.
Nomad Foods Limited (NOMD - Free Report) with a Zacks Rank #2 (Buy), has a trailing four-quarter earnings surprise of 10.3%, on average.
Zacks Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
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Pilgrim's Pride (PPC) Gains on Capacity Growth, Mexico Unit
Prudent operational strategies have been helping Pilgrim's Pride Corporation (PPC - Free Report) to stay afloat amid tough market conditions induced by the pandemic. This well-known fresh and frozen chicken products company is gaining from efforts to expand capacity for key products, robust online sales and prudent marketing strategies. Additionally, solid growth in Mexico and gradual revival of U.S operations have been upsides for the company. Let’s take a closer look.
Efforts to Boost Capacity & Product Offerings
Pilgrim's Pride’s customer centric approach propelled it to come up with unique offerings that provide competitive advantages. In fact, the company’s focus on key customers helps it refine portfolio and create competitive advantages over its peers, especially amid the coronavirus-led disruptions. Management is on track with a number of projects to support growth of its key customers. In this regard, the company is doubling the case-ready capacity in its Cold Spring, Minnesota plant. Also, Pilgrim's Pride is increasing the mix of more stable margin case-ready items and is expanding the manufacturing of Just BARE brand items by 20%. Moreover, it is converting a commoditized large bird deboning plant to effectively support demand.
Apart from this, the company has been steadily augmenting marketing support of its brands, as they expand and enter new regions. Additionally, it resorts to frequent supply chain improvements to enhance efficiency and reduce costs. In this respect, it has been progressing well with developing automation technology for its processing plants. Moreover, the company’s dedicated efforts, including zero-base budgeting and positive impacts from acquisitions, are expected to create synergies. Pilgrim's Pride has also been strengthening its portfolio through innovations. It has been increasing its product mix for organic category, including No-Antibiotics-Ever products, to meet customers' evolving tastes. Moreover, the company continues to see solid growth in online sales, mainly on the back of strength in the case-ready and prepared foods portfolio.
Strong Sales Across Regions
During first-quarter 2021, the company witnessed sales growth across Mexico, the U.K. and Europe as well as the United States, which in turn drove the top-line performance. The company’s Mexican operations gained from normalization of the economic environment, balanced supply/demand scenario and increased share of non-commodity products. Additional, growth in demand for Prepared Foods was an upside. Apart from this, the company’s combined European operations witnessed growth, backed by prudent operational improvements, despite weak foodservice volume due to lockdowns and costs related to the pandemic.
Additionally, the company stated that market conditions in the United Stated improved during the first quarter, despite some challenges related to severe weather in the southeast during February. Moreover, it is seeing recovery in the foodservice business as pandemic-led restrictions are being eased. The company’s retail and QSR business also remained strong on solid demand conditions. U.S. Prepared Foods business continues to gain traction. Also, its market for commodity large bird deboning saw improvements.
Wrapping Up
We expect Pilgrim's Pride to keep gaining from improving market and operational scenarios across markets, as pandemic-led shortcoming gradually subside due to mass vaccination. Shares of this Zacks Rank #3 (Hold) company have increased 16.1% in the past six months compared with the industry’s rise of 8.4%.
Looking for Food Stocks? Check These
Darling Ingredients Inc. (DAR - Free Report) , flaunting a Zacks Rank #1 (Strong Buy), has a trailing four-quarter earnings surprise of 29.8%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
Medifast, Inc. (MED - Free Report) , also with a Zacks Rank #1, has a trailing four-quarter earnings surprise of 12.7%, on average.
Nomad Foods Limited (NOMD - Free Report) with a Zacks Rank #2 (Buy), has a trailing four-quarter earnings surprise of 10.3%, on average.
Zacks Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>