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General Mills (GIS) Gains But Lags Market: What You Should Know

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In the latest trading session, General Mills (GIS - Free Report) closed at $68.77, marking a +0.76% move from the previous day. The stock lagged the S&P 500's daily gain of 0.94%. Meanwhile, the Dow gained 0.63%, and the Nasdaq, a tech-heavy index, lost 0.55%.

Heading into today, shares of the maker of Cheerios cereal, Yoplait yogurt and other packaged foods had gained 0.53% over the past month, outpacing the Consumer Staples sector's loss of 1.41% and the S&P 500's loss of 4.63% in that time.

Investors will be hoping for strength from General Mills as it approaches its next earnings release. On that day, General Mills is projected to report earnings of $0.83 per share, which would represent year-over-year growth of 1.22%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $4.6 billion, up 1.66% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $3.78 per share and revenue of $18.78 billion, which would represent changes of -0.26% and +3.58%, respectively, from the prior year.

Any recent changes to analyst estimates for General Mills should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. General Mills is currently sporting a Zacks Rank of #3 (Hold).

Looking at its valuation, General Mills is holding a Forward P/E ratio of 18.08. For comparison, its industry has an average Forward P/E of 18.12, which means General Mills is trading at a discount to the group.

Also, we should mention that GIS has a PEG ratio of 2.41. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. GIS's industry had an average PEG ratio of 3.17 as of yesterday's close.

The Food - Miscellaneous industry is part of the Consumer Staples sector. This group has a Zacks Industry Rank of 224, putting it in the bottom 13% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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