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B&G Foods' (BGS) Q3 Earnings Upcoming: Key Factors to Note
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B&G Foods, Inc. (BGS - Free Report) is likely to register a top-line increase from the year-ago fiscal quarter’s reading when it reports third-quarter fiscal 2022 earnings on Nov 9. The Zacks Consensus Estimate for quarterly revenues is pegged at $531 million, suggesting a rise of 3.2% from the prior-year fiscal quarter’s reported figure.
The Zacks Consensus Estimate for quarterly earnings has declined by a penny in the past 30 days to 31 cents per share. This indicates a 43.6% slump from the figure reported in the prior-year fiscal quarter.
This food company has a trailing four-quarter negative earnings surprise of around 24%, on average. BGS delivered a negative earnings surprise of 74.1% in the last reported quarter.
We expect third-quarter net revenues to be up 4.3% year over year to $537 million and the bottom line to decrease 39.6% to 33 cents a share.
B&G Foods has been battling cost inflation like many other industry players. In the second quarter of 2022, the company’s gross profit came in at $78.8 million compared with $112 million in the year-ago period.
The adjusted gross margin contracted from 24.1% to 16.5% in the quarter under review. The gross margin was hurt by greater-than-anticipated input cost inflation. This includes escalated raw materials and transportation expenses.
The company expects the input cost inflation to have a considerably industry-wide effect in the remainder of fiscal 2022, per the last earnings call. Management expects to keep seeing significant cost inflation for inputs, such as ingredients, packaging, labor and transportation, due to factors like the pandemic, the Ukraine war, weather conditions, supply-chain hurdles and the shortage of labor.
However, management is on track to mitigate the impact of inflation by undertaking cost-saving initiatives, increasing list prices and locking in prices via short-term supply contracts and advanced commodities purchase agreements. However, these may not fully offset additional cost headwinds in the remaining part of fiscal 2022, which raises concerns for the quarter under review.
On its second-quarter 2022 call, management stated that apart from cost inflation, other pandemic-related factors may impact the company’s performance. These include the duration of social distancing and stay-at-home trends, other waves or variants of the pandemic, the operation of manufacturing facilities, the company’s ability to procure ingredients and other raw materials and supply-chain status, among others.
However, B&G Foods has been benefiting from higher demand as consumers are cooking more at home. In 2022, management expects to keep witnessing the solid consumer demand for its products, per the last earnings call. This is likely to have aided third-quarter revenues.
B&G Foods’ focus on core priorities bodes well. These include managing the company efficiently amid the ongoing inflationary pricing and supply scenario. Further, the company intends to improve organic growth beyond pandemic recovery to more than 1-2% by making the most of remote/work-from-home trends and renewed cooking interests.
Moving on, B&G Foods is focused on brands and categories, wherein it has more capability. It also focuses on undertaking prudent buyouts that are accretive to the company’s portfolio and cash flows.
Finally, management is committed to speeding up cost savings and productivity initiatives to improve margins in the long term.
What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for B&G Foods this time. 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, which is not the case here.
B&G Foods has a Zacks Rank #5 (Strong Sell) and an Earnings ESP of -3.23%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks With the Favorable Combination
Here are some companies worth considering as our model shows that these have the right combination of elements to beat earnings this season.
Darling Ingredients Inc. (DAR - Free Report) currently has an Earnings ESP of +0.23% and a Zacks Rank #2. The company is likely to register bottom-line growth when it reports third-quarter 2022 earnings.
Darling Ingredients’ top line is also anticipated to have increased year over year. The consensus mark for DAR’s revenues is pegged at $1.68 billion, indicating an increase of 41.9% from the figure reported in the year-ago quarter. DAR has a trailing four-quarter earnings surprise of 3.9%, on average.
Campbell Soup Company (CPB - Free Report) currently has an Earnings ESP of +4.30% and a Zacks Rank #3. The company is expected to register a decrease in the bottom line when it reports first-quarter fiscal 2023 results. The Zacks Consensus Estimate for the quarterly EPS of 84 cents suggests a dip of 5.6% from the year-ago quarter.
Campbell Soup’s top line is anticipated to have increased year over year. The consensus mark for CPB’s revenues is pegged at $2.42 billion, indicating an increase of 8.1% from the figure reported in the year-ago quarter. CPB has a trailing four-quarter earnings surprise of 6.5%, on average.
The J. M. Smucker Company (SJM - Free Report) currently has an Earnings ESP of +1.06% and a Zacks Rank #3. The company is expected to register a decrease in the bottom line when it reports second-quarter fiscal 2023 results. The Zacks Consensus Estimate for the quarterly EPS of $2.17 suggests a dip of 10.7% from the year-ago quarter.
Smucker’s top line is anticipated to have increased year over year. The consensus mark for SJM’s revenues is pegged at $2.16 billion, indicating an increase of 5.2% from the figure reported in the year-ago quarter. Smucker has a trailing four-quarter earnings surprise of 20.8%, on average.
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B&G Foods' (BGS) Q3 Earnings Upcoming: Key Factors to Note
B&G Foods, Inc. (BGS - Free Report) is likely to register a top-line increase from the year-ago fiscal quarter’s reading when it reports third-quarter fiscal 2022 earnings on Nov 9. The Zacks Consensus Estimate for quarterly revenues is pegged at $531 million, suggesting a rise of 3.2% from the prior-year fiscal quarter’s reported figure.
The Zacks Consensus Estimate for quarterly earnings has declined by a penny in the past 30 days to 31 cents per share. This indicates a 43.6% slump from the figure reported in the prior-year fiscal quarter.
This food company has a trailing four-quarter negative earnings surprise of around 24%, on average. BGS delivered a negative earnings surprise of 74.1% in the last reported quarter.
We expect third-quarter net revenues to be up 4.3% year over year to $537 million and the bottom line to decrease 39.6% to 33 cents a share.
B&G Foods, Inc. Price, Consensus and EPS Surprise
B&G Foods, Inc. price-consensus-eps-surprise-chart | B&G Foods, Inc. Quote
Factors to Consider
B&G Foods has been battling cost inflation like many other industry players. In the second quarter of 2022, the company’s gross profit came in at $78.8 million compared with $112 million in the year-ago period.
The adjusted gross margin contracted from 24.1% to 16.5% in the quarter under review. The gross margin was hurt by greater-than-anticipated input cost inflation. This includes escalated raw materials and transportation expenses.
The company expects the input cost inflation to have a considerably industry-wide effect in the remainder of fiscal 2022, per the last earnings call. Management expects to keep seeing significant cost inflation for inputs, such as ingredients, packaging, labor and transportation, due to factors like the pandemic, the Ukraine war, weather conditions, supply-chain hurdles and the shortage of labor.
However, management is on track to mitigate the impact of inflation by undertaking cost-saving initiatives, increasing list prices and locking in prices via short-term supply contracts and advanced commodities purchase agreements. However, these may not fully offset additional cost headwinds in the remaining part of fiscal 2022, which raises concerns for the quarter under review.
On its second-quarter 2022 call, management stated that apart from cost inflation, other pandemic-related factors may impact the company’s performance. These include the duration of social distancing and stay-at-home trends, other waves or variants of the pandemic, the operation of manufacturing facilities, the company’s ability to procure ingredients and other raw materials and supply-chain status, among others.
However, B&G Foods has been benefiting from higher demand as consumers are cooking more at home. In 2022, management expects to keep witnessing the solid consumer demand for its products, per the last earnings call. This is likely to have aided third-quarter revenues.
B&G Foods’ focus on core priorities bodes well. These include managing the company efficiently amid the ongoing inflationary pricing and supply scenario. Further, the company intends to improve organic growth beyond pandemic recovery to more than 1-2% by making the most of remote/work-from-home trends and renewed cooking interests.
Moving on, B&G Foods is focused on brands and categories, wherein it has more capability. It also focuses on undertaking prudent buyouts that are accretive to the company’s portfolio and cash flows.
Finally, management is committed to speeding up cost savings and productivity initiatives to improve margins in the long term.
What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for B&G Foods this time. 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, which is not the case here.
B&G Foods has a Zacks Rank #5 (Strong Sell) and an Earnings ESP of -3.23%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks With the Favorable Combination
Here are some companies worth considering as our model shows that these have the right combination of elements to beat earnings this season.
Darling Ingredients Inc. (DAR - Free Report) currently has an Earnings ESP of +0.23% and a Zacks Rank #2. The company is likely to register bottom-line growth when it reports third-quarter 2022 earnings.
The Zacks Consensus Estimate for the quarterly earnings per share (EPS) of $1.42 suggests a dip of 61.4% from the year-ago quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.
Darling Ingredients’ top line is also anticipated to have increased year over year. The consensus mark for DAR’s revenues is pegged at $1.68 billion, indicating an increase of 41.9% from the figure reported in the year-ago quarter. DAR has a trailing four-quarter earnings surprise of 3.9%, on average.
Campbell Soup Company (CPB - Free Report) currently has an Earnings ESP of +4.30% and a Zacks Rank #3. The company is expected to register a decrease in the bottom line when it reports first-quarter fiscal 2023 results. The Zacks Consensus Estimate for the quarterly EPS of 84 cents suggests a dip of 5.6% from the year-ago quarter.
Campbell Soup’s top line is anticipated to have increased year over year. The consensus mark for CPB’s revenues is pegged at $2.42 billion, indicating an increase of 8.1% from the figure reported in the year-ago quarter. CPB has a trailing four-quarter earnings surprise of 6.5%, on average.
The J. M. Smucker Company (SJM - Free Report) currently has an Earnings ESP of +1.06% and a Zacks Rank #3. The company is expected to register a decrease in the bottom line when it reports second-quarter fiscal 2023 results. The Zacks Consensus Estimate for the quarterly EPS of $2.17 suggests a dip of 10.7% from the year-ago quarter.
Smucker’s top line is anticipated to have increased year over year. The consensus mark for SJM’s revenues is pegged at $2.16 billion, indicating an increase of 5.2% from the figure reported in the year-ago quarter. Smucker has a trailing four-quarter earnings surprise of 20.8%, on average.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.