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Pilgrim's Pride (PPC) Queued for Q2 Earnings: Things to Note

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Pilgrim's Pride Corporation (PPC - Free Report) is likely to register growth in the bottom line when it reports second-quarter 2021 numbers on Jul 28. The Zacks Consensus Estimate has risen 7.3% in the past 30 days to 59 cents per share. In the year-ago period, the company delivered breakeven results. This producer, marketer, processor and distributor of fresh, frozen and value-added chicken and pork products has a trailing four-quarter negative earnings surprise of 7.3%, on average. In the last reported quarter, Pilgrim's Pride delivered an earnings surprise of 55.6%.

Pilgrims Pride Corporation Price, Consensus and EPS Surprise

Pilgrims Pride Corporation Price, Consensus and EPS Surprise

Pilgrims Pride Corporation price-consensus-eps-surprise-chart | Pilgrims Pride Corporation Quote

Key Factors to Note

Pilgrim's Pride has been benefiting from its efforts to boost the product portfolio, operational endeavors and the Key Customer strategy. These helped the company mitigate the impacts of tough market conditions amid the pandemic. Strong online sales are also driving growth for the company. On its first-quarter 2021 earnings call, management stated that it continues to see solid online growth, on the back of strength in the case-ready and prepared foods portfolio. The company, then, had projected online sales to increase about 22% over the next five years, which also bodes well for the quarter under review. Apart from these, Pilgrim’s Pride is witnessing market share gains in brick-and-mortar retail distribution.

The company is witnessing recovery in the U.S. foodservice business as pandemic-led restrictions are being eased. The company’s retail and QSR business in the region remained strong on solid demand in the last reported quarter. Management on its first-quarter earnings call said that it expects the commodity market to remain solid beyond 2021. Further, foodservice demand is likely to go back to pre-pandemic levels with more inoculations. The company’s Mexico operations are also well placed, thanks to the normalization of the economic environment and a balanced supply/demand scenario.

That said, Pilgrim's Pride has been grappling with an increased cost of sales for the past few quarters. Direct pandemic-mitigating expenses and escalated input costs are also concerning. Additionally, the company’s constant growth-oriented investments might have negatively impacted margins. 

What the Zacks Model Unveils

Our proven model doesn’t conclusively predict an earnings beat for Pilgrim's Pride 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.

Pilgrim's Pride 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.

Medifast (MED - Free Report) has an Earnings ESP of +6.85% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Mondelez International (MDLZ - Free Report) has an Earnings ESP of +2.47% and a Zacks Rank #3.

B&G Foods (BGS - Free Report) has an Earnings ESP of +6.82% and a Zacks Rank #3.