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Factors Making General Mills (GIS) Stock Worth Betting on

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General Mills, Inc. (GIS - Free Report) appears in great shape. The manufacturer and marketer of branded consumer foods continues benefiting from its Accelerate strategy. Strength in the Pet segment is also a constant upside.

These uptrends were visible in the first quarter of fiscal 2023, wherein the top and bottom lines increased year over year and beat the Zacks Consensus Estimate. Additionally, management had raised its fiscal 2023 organic net sales, operating profit and earnings per share (EPS) view on its last earnings release.

Shares of this presently Zacks Rank #2 (Buy) player have risen 7.4% in the past three months compared with the industry’s growth of 4%. The Zacks Consensus Estimate for fiscal 2023 EPS has risen a penny to $4.09 over the past 30 days.

Let’s delve deeper.

General Mills, Inc. Price, Consensus and EPS Surprise

General Mills, Inc. Price, Consensus and EPS Surprise

General Mills, Inc. price-consensus-eps-surprise-chart | General Mills, Inc. Quote

Factors Acting as Upsides

General Mills is focused on its Accelerate strategy (unveiled in February 2021), which aids it in choosing how to win and where to play to boost profitability and enhance shareholder returns in the long run. Under how to win, GIS concentrates on four pillars designed to provide a competitive edge. These include brand building, undertaking innovations, unleashing scale and maintaining business strength.

Where to play principle is outlined to enhance GIS’ capabilities to generate profitability through geographic and product prioritization along with portfolio restructuring. This includes prioritizing investment, investing in five Global Platforms, driving growth in Local Gem brands and reshaping the portfolio. With regard to portfolio rationalization, management announced or concluded seven transactions in fiscal 2022, including two buyouts and five divestitures, aimed at driving growth in the long run.

For fiscal 2023, General Mills remains committed to the Accelerate strategy, underscored by its three priorities, such as competing efficiently through brand building, investing in Holistic Margin Management (HMM) and Strategic Revenue Management (SRM) initiatives to counter inflation, making other strategic business investments, staying committed to ESG goals and streamlining its portfolio.

General Mills’ Pet segment has been performing well for a while. In the first quarter of fiscal 2023, segment revenues came in at $579.9 million, up 19% from the year-ago fiscal quarter’s level, led by the positive net price realization and mix. Net sales included five points of gains from the pet treat business buyout (concluded on Jul 6, 2021). Organic sales increased 14% year over year. A higher pet population, and more humanization and premiumization of pet food since the pandemic have been steady tailwinds to GIS’s pet food category.

A Look Ahead

The above-mentioned positives are likely to keep General Mills on the growth trajectory. For fiscal 2023, organic net sales are anticipated to increase 6-7%. Earlier, management expected organic net sales growth of 4-5%. Management expects adjusted operating profit growth at cc to be flat to increase 3%. Earlier, the metric was anticipated between a 2% decline and an increase of 1%. Adjusted EPS growth at cc is now envisioned between 2% and 5%. Management had earlier expected the metric to be flat to up 3%.

Looking for Other Consumer Staple Stocks? Check These

Some other top-ranked stocks from the sector are Lamb Weston (LW - Free Report) , Conagra Brands (CAG - Free Report) and The J. M. Smucker Company (SJM - Free Report) .

Lamb Weston, a frozen potato product company, currently sports a Zacks Rank #1 (Strong Buy). LW has a trailing four-quarter earnings surprise of 47.3%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Lamb Weston’s current financial-year sales and earnings suggests growth of 14.6% and 45.7%, respectively, from the comparable year-ago reported numbers.

Conagra Brands, operating as a consumer packaged goods food company, carries a Zacks Rank #2 at present. CAG has a trailing four-quarter earnings surprise of 1.8%, on average.

The Zacks Consensus Estimate for CAG’s current financial-year sales and earnings suggests growth of 5.2% and 3.4%, respectively, from the corresponding year-ago reported numbers.

The J. M. Smucker manufacturing and marketing branded food and beverage products, currently carries a Zacks Rank of 2. SJM has a trailing four-quarter earnings surprise of 18.5%, on average.

The Zacks Consensus Estimate for The J. M. Smucker’s current financial-year sales suggests growth of 5.6% from the year-ago reported figure.

In-Depth Zacks Research for the Tickers Above

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General Mills, Inc. (GIS) - free report >>

Conagra Brands (CAG) - free report >>

The J. M. Smucker Company (SJM) - free report >>

Lamb Weston (LW) - free report >>

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