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Factors Setting the Stage for General Mills' (GIS) Q4 Earnings
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General Mills, Inc. (GIS - Free Report) is likely to witness declines in the top and bottom lines, when it reports fourth-quarter fiscal 2021 numbers on Jun 30. The Zacks Consensus Estimate for revenues is pegged at $4,331 million, suggesting a fall of 13.8% from the prior-year quarter’s reported figure. In the last reported quarter, the company witnessed an 8% increase in revenues.
The Zacks Consensus Estimate for earnings has risen a penny over the past 30 days to 84 cents per share, which suggests a decline of 23.6% from the figure reported in the prior-year period. The company has a trailing four-quarter earnings surprise of 6.4%, on average. In the last reported quarter, General Mills posted a negative earnings surprise of 2.4%.
General Mills, Inc. Price, Consensus and EPS Surprise
Though General Mills expects a rise in full-year organic sales in fiscal 2021, it expects tough year-over-year sales comparisons in the fourth quarter of fiscal 2021. The tough comparison is expected on account of the initial surge in coronavirus-led at-home food demand as well as an extra month of Pet segment results in the year-ago period.
That said, recovery in the away-from-home food demand with pandemic-led curbs being lifted and things opening up bodes well. Additionally, General Mills’ focus on its three core priorities for fiscal 2021, which include competing efficiently, operating with efficacy to fuel investments in brands and capabilities, and reducing leverage, is noteworthy. Moreover, the company’s Accelerate strategy holds promise.
Apart from these, General Mills is benefiting from its Pet segment. On its third-quarter fiscal 2021 earnings call, management stated that Blue Buffalo has emerged as a successful omnichannel business in the past three years, thanks to brand strength and customer partnerships. Moreover, the segment has been doing well amid the pandemic, as the rate of U.S. pet population growth has nearly doubled from the pre-pandemic level. Clearly, increased stay-at-home trends have led to higher pet adoption rates. Further, consumers’ increased shift to premium quality natural food keeps Blue Buffalo well placed. Incidentally, General Mills’ long-term strategy of driving sustained growth in the Pet unit goes in tandem with its broader Accelerate strategy.
However, elevated input costs and higher logistic costs are a concern for the company’s margins.
What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for General Mills 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.
General Mills currently has a Zacks Rank #3 and an Earnings ESP of -0.09%.
Stocks With Favorable Combinations
Here are some companies you may want to consider, as our model shows that these too have the right combination of elements to post an earnings beat this season.
Philip Morris (PM - Free Report) has an Earnings ESP of +0.33% and a Zacks Rank of 3.
The Hershey Company (HSY - Free Report) has an Earnings ESP of +3.97% and a Zacks Rank #3.
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Factors Setting the Stage for General Mills' (GIS) Q4 Earnings
General Mills, Inc. (GIS - Free Report) is likely to witness declines in the top and bottom lines, when it reports fourth-quarter fiscal 2021 numbers on Jun 30. The Zacks Consensus Estimate for revenues is pegged at $4,331 million, suggesting a fall of 13.8% from the prior-year quarter’s reported figure. In the last reported quarter, the company witnessed an 8% increase in revenues.
The Zacks Consensus Estimate for earnings has risen a penny over the past 30 days to 84 cents per share, which suggests a decline of 23.6% from the figure reported in the prior-year period. The company has a trailing four-quarter earnings surprise of 6.4%, on average. In the last reported quarter, General Mills posted a negative earnings surprise of 2.4%.
General Mills, Inc. Price, Consensus and EPS Surprise
General Mills, Inc. price-consensus-eps-surprise-chart | General Mills, Inc. Quote
Key Factors to Note
Though General Mills expects a rise in full-year organic sales in fiscal 2021, it expects tough year-over-year sales comparisons in the fourth quarter of fiscal 2021. The tough comparison is expected on account of the initial surge in coronavirus-led at-home food demand as well as an extra month of Pet segment results in the year-ago period.
That said, recovery in the away-from-home food demand with pandemic-led curbs being lifted and things opening up bodes well. Additionally, General Mills’ focus on its three core priorities for fiscal 2021, which include competing efficiently, operating with efficacy to fuel investments in brands and capabilities, and reducing leverage, is noteworthy. Moreover, the company’s Accelerate strategy holds promise.
Apart from these, General Mills is benefiting from its Pet segment. On its third-quarter fiscal 2021 earnings call, management stated that Blue Buffalo has emerged as a successful omnichannel business in the past three years, thanks to brand strength and customer partnerships. Moreover, the segment has been doing well amid the pandemic, as the rate of U.S. pet population growth has nearly doubled from the pre-pandemic level. Clearly, increased stay-at-home trends have led to higher pet adoption rates. Further, consumers’ increased shift to premium quality natural food keeps Blue Buffalo well placed. Incidentally, General Mills’ long-term strategy of driving sustained growth in the Pet unit goes in tandem with its broader Accelerate strategy.
However, elevated input costs and higher logistic costs are a concern for the company’s margins.
What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for General Mills 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.
General Mills currently has a Zacks Rank #3 and an Earnings ESP of -0.09%.
Stocks With Favorable Combinations
Here are some companies you may want to consider, as our model shows that these too have the right combination of elements to post an earnings beat this season.
PepsiCo (PEP - Free Report) has an Earnings ESP of +1.33% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Philip Morris (PM - Free Report) has an Earnings ESP of +0.33% and a Zacks Rank of 3.
The Hershey Company (HSY - Free Report) has an Earnings ESP of +3.97% and a Zacks Rank #3.
Bitcoin, Like the Internet Itself, Could Change Everything
Blockchain and cryptocurrency has sparked one of the most exciting discussion topics of a generation. Some call it the “Internet of Money” and predict it could change the way money works forever. If true, it could do to banks what Netflix did to Blockbuster and Amazon did to Sears. Experts agree we’re still in the early stages of this technology, and as it grows, it will create several investing opportunities.
Zacks’ has just revealed 3 companies that can help investors capitalize on the explosive profit potential of Bitcoin and the other cryptocurrencies with significantly less volatility than buying them directly.
See 3 crypto-related stocks now >>