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Pilgrim's Pride (PPC) Up More than 20% in 6 Months: Here's Why
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Pilgrim's Pride Corporation (PPC - Free Report) looks well-positioned courtesy of its focus on strategic growth initiatives, including capacity expansions. The leading poultry producer benefits from sales growth in its Mexico, U.K. and Europe as well as U.S. operations.
These upsides were seen in Pilgrim's Pride’s second-quarter 2022 results, with the top and bottom lines increasing year over year. Earnings in the quarter surpassed the Zacks Consensus Estimate. The company registered top-line growth across all business units, fueled by impressive service levels to Key Customers, which led to a solid sequential profit rise. Demand for Pilgrim's Pride’s productsin overall retail and foodservice operations remained impressive. The company continues to benefit from long-term investments like automation and focus on service for key customers.
The Zacks Rank #2 (Buy) company’s shares have increased 20.7% in the past six months against the industry’s 9.8% decline. The company has comfortably outperformed the Zacks Consumer Staples sector, which witnessed a 1.5% decline during the same period.
Image Source: Zacks Investment Research
Growth Efforts Hold Promise
Pilgrim’s Pride’s customer-centric approach propelled it to introduce unique offerings that provide competitive advantages. The company’s focus on key customers is a pathway for refining its portfolio and creating competitive advantages over its peers. Taking into account its focus on profitable growth and impressive market momentum, management recently unveiled some new investments in the United States. In this regard, management is investing in expanding the Athens, Georgia, facility to improve service levels and boost Key Customer growth.
The company will undertake operational excellence improvements via automation throughout its U.S. footprint and construct a protein conversion plant for pet food ingredients in Georgia. Pilgrim's Pride will develop a Prepared Foods facility in the Southeast USA to support branded growth and diversify its portfolio. The company incurred capital expenditures of $115 million in the second quarter of 2022, taking the total year-to-date number to $196 million. Management estimates its investments to be approximately $450 million in the next three years.
Apart from this, the company has been steadily augmenting the 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. Introducing such advanced technology is expected to increase efficiency and aid in combating labor availability issues.
In sync with its growth strategy, Pilgrim’s Pride acquired Kerry Consumer Foods’ Meats and Meals business in the U.K. and Ireland in September 2021. The acquired business solidifies Pilgrim’s Pride’s footing by operating as a business division under the company’s European operations. The company’s disciplined capital allocation approach to diversify the portfolio, focus on key customers and achieve operational excellence bodes well.
All said, focus on strategic growth endeavors along with solid performance across all regions is likely to keep Pilgrim’s Pride in investors’ good books.
Chef’s Warehouse, a distributor of specialty food products in the United States, currently flaunts a Zacks Rank #1 (Strong Buy). CHEF has a trailing four-quarter earnings surprise of 355.9%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Chef Warehouse’s current financialyear sales suggests growth of 40.7%from the year-ago reported numbers.
General Mills, which manufactures and markets branded consumer foods worldwide, currently carries a Zacks Rank of 2. GIS has a trailing four-quarter earnings surprise of 6.5%, on average.
The Zacks Consensus Estimate for General Mills’ current financial year sales and earnings per share suggests growth of almost 2% and 1.5%, respectively, from the corresponding year-ago reported figures.
Celsius Holdings, which develops, processes, markets, distributes and sells functional drinks and liquid supplements, carries a Zacks Rank #2 at present. Celsius Holdings delivered an earnings surprise of 50% in the last reported quarter.
The Zacks Consensus Estimate for CELH’s current financial year sales suggests growth of 97.3% from the year-ago period’s reported figures.
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Pilgrim's Pride (PPC) Up More than 20% in 6 Months: Here's Why
Pilgrim's Pride Corporation (PPC - Free Report) looks well-positioned courtesy of its focus on strategic growth initiatives, including capacity expansions. The leading poultry producer benefits from sales growth in its Mexico, U.K. and Europe as well as U.S. operations.
These upsides were seen in Pilgrim's Pride’s second-quarter 2022 results, with the top and bottom lines increasing year over year. Earnings in the quarter surpassed the Zacks Consensus Estimate. The company registered top-line growth across all business units, fueled by impressive service levels to Key Customers, which led to a solid sequential profit rise. Demand for Pilgrim's Pride’s productsin overall retail and foodservice operations remained impressive. The company continues to benefit from long-term investments like automation and focus on service for key customers.
The Zacks Rank #2 (Buy) company’s shares have increased 20.7% in the past six months against the industry’s 9.8% decline. The company has comfortably outperformed the Zacks Consumer Staples sector, which witnessed a 1.5% decline during the same period.
Image Source: Zacks Investment Research
Growth Efforts Hold Promise
Pilgrim’s Pride’s customer-centric approach propelled it to introduce unique offerings that provide competitive advantages. The company’s focus on key customers is a pathway for refining its portfolio and creating competitive advantages over its peers. Taking into account its focus on profitable growth and impressive market momentum, management recently unveiled some new investments in the United States. In this regard, management is investing in expanding the Athens, Georgia, facility to improve service levels and boost Key Customer growth.
The company will undertake operational excellence improvements via automation throughout its U.S. footprint and construct a protein conversion plant for pet food ingredients in Georgia. Pilgrim's Pride will develop a Prepared Foods facility in the Southeast USA to support branded growth and diversify its portfolio. The company incurred capital expenditures of $115 million in the second quarter of 2022, taking the total year-to-date number to $196 million. Management estimates its investments to be approximately $450 million in the next three years.
Apart from this, the company has been steadily augmenting the 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. Introducing such advanced technology is expected to increase efficiency and aid in combating labor availability issues.
In sync with its growth strategy, Pilgrim’s Pride acquired Kerry Consumer Foods’ Meats and Meals business in the U.K. and Ireland in September 2021. The acquired business solidifies Pilgrim’s Pride’s footing by operating as a business division under the company’s European operations. The company’s disciplined capital allocation approach to diversify the portfolio, focus on key customers and achieve operational excellence bodes well.
All said, focus on strategic growth endeavors along with solid performance across all regions is likely to keep Pilgrim’s Pride in investors’ good books.
Other Solid Food Bets
Some other top-ranked stocks are The Chef's Warehouse (CHEF - Free Report) , General Mills, Inc. (GIS - Free Report) and Celsius Holdings (CELH - Free Report) .
Chef’s Warehouse, a distributor of specialty food products in the United States, currently flaunts a Zacks Rank #1 (Strong Buy). CHEF has a trailing four-quarter earnings surprise of 355.9%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Chef Warehouse’s current financialyear sales suggests growth of 40.7%from the year-ago reported numbers.
General Mills, which manufactures and markets branded consumer foods worldwide, currently carries a Zacks Rank of 2. GIS has a trailing four-quarter earnings surprise of 6.5%, on average.
The Zacks Consensus Estimate for General Mills’ current financial year sales and earnings per share suggests growth of almost 2% and 1.5%, respectively, from the corresponding year-ago reported figures.
Celsius Holdings, which develops, processes, markets, distributes and sells functional drinks and liquid supplements, carries a Zacks Rank #2 at present. Celsius Holdings delivered an earnings surprise of 50% in the last reported quarter.
The Zacks Consensus Estimate for CELH’s current financial year sales suggests growth of 97.3% from the year-ago period’s reported figures.