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Pilgrim's Pride (PPC) Gains on Solid Performance, Growth Efforts
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Focus on strategic growth initiatives, including customer-centric approach and capacity expansions, are favoring Pilgrim's Pride Corporation (PPC - Free Report) . The company benefits from strength in its Mexico, Europe and U.S. operations. Improvement in the foodservice business is also a tailwind. These were reflected in PPC’s fourth-quarter 2021 results, with the top and the bottom line increasing year over year. Earnings in the quarter surpassed the Zacks Consensus Estimate.
The Zacks Consensus Estimate for Pilgrim's Pride’s first-quarter 2022 earnings is pegged at 65 cents per share, projecting 54.8% growth from the figure reported in the year-ago quarter.
Let’s discuss further.
Image Source: Zacks Investment Research
Solid Q1 Performance
Pilgrim's Pride reported fourth-quarter 2021 adjusted earnings of 56 cents a share, up from 25 cents reported in the year-ago quarter. The company’s net sales of $4,038.8 increased 29.5%, reflecting 20.6% organic growth and a 9.4% contribution from the acquisition of Pilgrim's Food Masters (concluded in September 2021). Net sales increased in Mexico, Europe and in the U.S. operations. Management highlighted that overall domestic demand remained solid throughout 2021 in the U.S. market. The company’s foodservice business also witnessed improvements on the back of a sustained recovery in commercial and noncommercial segments.
Focus on Growth Initiatives
The Zacks Rank #1 (Strong Buy) company’s customer-centric approach propelled it to roll out unique offerings that provide competitive advantages. Focus on key customers helps the company refine its portfolio and create competitive advantages over its peers, especially amid the coronavirus-led disruptions. Management announced several projects in 2020 to support key customers growth. The company is inclined toward 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. In its fourth-quarter 2020 earnings call, management stated that it is converting a commoditized large bird deboning plant to support solid demand from a key customer QSR in the small bird segment. The company continues to gain from distribution and is on track to build the Just BARE brand via e-commerce, retail and club stores.
The company has also been steadily augmenting brands’ marketing support as they expand and enter new regions. PPC resorts to frequent supply-chain improvements to enhance efficiency and reduce costs. It has been developing automation technology for its processing plants. Introducing such advanced technology is expected to increase efficiency and help the company combat labor-availability issues. The company’s dedicated efforts, including zero-base budgeting and positive impacts from acquisitions, are expected to create synergies. In its last earnings call, management highlighted that it continues to prioritize capital spending plans in 2022 to optimize product mix and solidify partnerships with key customers. The company is on track to invest in solid ROCE projects to enhance operational efficiencies via automation. Management anticipates incurring $410-$430 million of capital spending in 2022.
Focusing on strategic growth endeavors along with solid regional performances is likely to keep Pilgrim’s Pride’s well-positioned. PPC’s stock has increased 13.4% in the past year compared with the industry’s 5.8% growth.
Flowers Foods, the producer and marketer of packaged bakery products, carries a Zacks Rank #2 (Buy). Shares of Flowers Foods have increased 12.6% in the past year. You can seethe complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Flowers Foods’ current financial year sales and earnings per share (EPS) suggests growth of 7.2% and 4%, respectively, from the year-ago reported figure. FLO has a trailing four-quarter earnings surprise of 9%, on average.
McCormick is one of the leading manufacturers, marketers and distributors of spices, seasonings, specialty foods and flavors. It presently carries a Zacks Rank #2. Shares of McCormick have increased 13.7% in the past year.
The Zacks Consensus Estimate for McCormick's current financial-year sales and EPS suggests growth of 5% and 3.9%, respectively, from the year-ago period’s reported figures. MKC has a trailing four-quarter earnings surprise of 7.3%, on average.
Sysco, the marketer and distributor of food and related products, currently carries a Zacks #2.Shares of Sysco have increased 8.1% in the past year.
The Zacks Consensus Estimate for Sysco’s current financial-year sales and earnings suggests growth of 30.4% and 120.1%, respectively, from the corresponding year-ago period’s reported figures. SYY has a trailing four-quarter earnings surprise of 3.7%, on average.
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Pilgrim's Pride (PPC) Gains on Solid Performance, Growth Efforts
Focus on strategic growth initiatives, including customer-centric approach and capacity expansions, are favoring Pilgrim's Pride Corporation (PPC - Free Report) . The company benefits from strength in its Mexico, Europe and U.S. operations. Improvement in the foodservice business is also a tailwind. These were reflected in PPC’s fourth-quarter 2021 results, with the top and the bottom line increasing year over year. Earnings in the quarter surpassed the Zacks Consensus Estimate.
The Zacks Consensus Estimate for Pilgrim's Pride’s first-quarter 2022 earnings is pegged at 65 cents per share, projecting 54.8% growth from the figure reported in the year-ago quarter.
Let’s discuss further.
Image Source: Zacks Investment Research
Solid Q1 Performance
Pilgrim's Pride reported fourth-quarter 2021 adjusted earnings of 56 cents a share, up from 25 cents reported in the year-ago quarter. The company’s net sales of $4,038.8 increased 29.5%, reflecting 20.6% organic growth and a 9.4% contribution from the acquisition of Pilgrim's Food Masters (concluded in September 2021). Net sales increased in Mexico, Europe and in the U.S. operations. Management highlighted that overall domestic demand remained solid throughout 2021 in the U.S. market. The company’s foodservice business also witnessed improvements on the back of a sustained recovery in commercial and noncommercial segments.
Focus on Growth Initiatives
The Zacks Rank #1 (Strong Buy) company’s customer-centric approach propelled it to roll out unique offerings that provide competitive advantages. Focus on key customers helps the company refine its portfolio and create competitive advantages over its peers, especially amid the coronavirus-led disruptions. Management announced several projects in 2020 to support key customers growth. The company is inclined toward 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. In its fourth-quarter 2020 earnings call, management stated that it is converting a commoditized large bird deboning plant to support solid demand from a key customer QSR in the small bird segment. The company continues to gain from distribution and is on track to build the Just BARE brand via e-commerce, retail and club stores.
The company has also been steadily augmenting brands’ marketing support as they expand and enter new regions. PPC resorts to frequent supply-chain improvements to enhance efficiency and reduce costs. It has been developing automation technology for its processing plants. Introducing such advanced technology is expected to increase efficiency and help the company combat labor-availability issues. The company’s dedicated efforts, including zero-base budgeting and positive impacts from acquisitions, are expected to create synergies. In its last earnings call, management highlighted that it continues to prioritize capital spending plans in 2022 to optimize product mix and solidify partnerships with key customers. The company is on track to invest in solid ROCE projects to enhance operational efficiencies via automation. Management anticipates incurring $410-$430 million of capital spending in 2022.
Focusing on strategic growth endeavors along with solid regional performances is likely to keep Pilgrim’s Pride’s well-positioned. PPC’s stock has increased 13.4% in the past year compared with the industry’s 5.8% growth.
3 Hot Food Bets
Some other top-ranked stocks are Flowers Foods (FLO - Free Report) , McCormick & Company (MKC - Free Report) and Sysco Corporation (SYY - Free Report) .
Flowers Foods, the producer and marketer of packaged bakery products, carries a Zacks Rank #2 (Buy). Shares of Flowers Foods have increased 12.6% in the past year. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Flowers Foods’ current financial year sales and earnings per share (EPS) suggests growth of 7.2% and 4%, respectively, from the year-ago reported figure. FLO has a trailing four-quarter earnings surprise of 9%, on average.
McCormick is one of the leading manufacturers, marketers and distributors of spices, seasonings, specialty foods and flavors. It presently carries a Zacks Rank #2. Shares of McCormick have increased 13.7% in the past year.
The Zacks Consensus Estimate for McCormick's current financial-year sales and EPS suggests growth of 5% and 3.9%, respectively, from the year-ago period’s reported figures. MKC has a trailing four-quarter earnings surprise of 7.3%, on average.
Sysco, the marketer and distributor of food and related products, currently carries a Zacks #2.Shares of Sysco have increased 8.1% in the past year.
The Zacks Consensus Estimate for Sysco’s current financial-year sales and earnings suggests growth of 30.4% and 120.1%, respectively, from the corresponding year-ago period’s reported figures. SYY has a trailing four-quarter earnings surprise of 3.7%, on average.