We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Campbell Soup Company (CPB - Free Report) reported stellar first-quarter fiscal 2023 results, with the top and the bottom line surpassing the Zacks Consensus Estimate and increasing year over year.
Taking into account its solid first-quarter results that reflect continued demand and enhanced supply chain execution, management raised its fiscal 2023 net sales, adjusted earnings Before Interest and Taxes (EBIT) and adjusted earnings per share (EPS) view. The outlook also reflects the dynamic economic environment.
In the quarter, the company generated $10 million in savings under its multi-year cost-saving program, including Snyder’s-Lance synergies, bringing total program-to-date cost savings to $860 million. Management remains on track to deliver savings worth $1 billion by fiscal 2025-end.
Quarterly Highlights
Adjusted earnings from continuing operations increased 15% year over year to $1.02 per share, mainly reflecting a rise in adjusted EBIT and somewhat offset by a rise in the adjusted effective tax rate. The metric surpassed the Zacks Consensus Estimate of 86 cents.
Net sales of $2,575 million increased 15% year over year and surpassed the Zacks Consensus Estimate of $2,427.5 million. Organic net sales grew 15% year over year. The upside can be attributed to brand strength, inflation-driven pricing and continued supply recovery.
Image Source: Zacks Investment Research
The company’s adjusted gross profit rose to $829 million from $727 million reported in the year-ago quarter. Adjusted gross profit margin contracted 30 basis points (bps) to 32.2% due to continued cost inflation and increased other supply chain costs as well as unfavorable volume/ mix. Nevertheless, inflation-driven pricing actions and productivity improvements offered some respite.
Adjusted EBIT grew 15% to reach $449 million mainly driven by increased adjusted gross profit. These were somewhat offset by rising marketing and selling expenses as well as increased adjusted other expenses.
Segmental Analysis
Meals & Beverages: Net sales increased 15% year over year to $1,455 million. Organic sales also rose 15%, mainly due to a rise in U.S. retail products that include U.S. soup and Prego pasta sauces and benefits from foodservice. Inflation-driven pricing, sales allowances and reduced promotional spending were somewhat mitigated by volume declines. Sales of U.S. soup increased 11% led by a sales rise in ready-to-serve soups, condensed soups and broth. Operating earnings in the unit jumped 18%.
Snacks: Net sales in the division rose 15% (also organically) to $1,120 million. The upside can be attributed to sales of power brands which rose 21%. Sales growth was fueled by a rise in cookies and crackers, specifically Goldfish crackers and in salty snacks, Snyder's of Hanover pretzels as well as Kettle Brand and CapeCod potato chips. Inflation-driven pricing and sales allowances were somewhat offset by soft volume and higher promotional spending. Segmental operating earnings increased 20%.
Other Financial Details
As of Oct 30, 2022, Campbell's total cash and cash equivalents stood at $130 million, long-term debt was $3,994 million, and total equity amounted to $3,469 million. CPB generated $227 million as cash flow from operations for three months ended Oct 30, 2022. Capital expenditure amounted to $77 million in the said period.
Management paid $115 million of cash dividends and bought back nearly $41 million in the reported quarter. At the end of the first quarter, it had nearly $375 million remaining under its current $500-million share repurchase plan and almost $131 million remaining under its $250 million anti-dilutive share repurchase plan.
Fiscal 2023 Guidance
For fiscal 2023, the company now expects 7-9% net sales growth, with 7-9% organic sales growth. Earlier, management had expected 4-6% net sales growth, with 4-6% organic sales growth for fiscal 2023. Adjusted EBIT is now forecast to be up 2.5-6.5% compared with the previous view of 1-5% growth. Adjusted EPS is now envisioned to be up 2-5% to come in at $2.90-$3.00. Earlier, adjusted EPS was projected to be flat to up 4%.
Shares of the Zacks Rank #3 (Hold) company have gained 10.8% in the past three months compared with the industry's growth of 7.9%.
The Chef's Warehouse, which distributes specialty food products, currently sports a Zacks Rank #1 (Strong Buy). Chef's Warehouse has a trailing four-quarter earnings surprise of 93.8%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for CHEF’s current financial year sales suggests growth of 46.5% from the year-ago reported number, while earnings indicate significant growth.
General Mills, which manufactures and markets branded consumer foods, carries a Zacks Rank #2(Buy) at present. General Mills has a trailing four-quarter earnings surprise of 6.1%, on average.
The Zacks Consensus Estimate for GIS’ current financial year sales and earnings suggests growth of 2.7% and 3.8%, respectively, from the year-ago reported numbers.
Conagra Brands, operating as a consumer-packaged goods food company, currently carries a Zacks Rank of 2. CAG has a trailing four-quarter earnings surprise of 1.8%, on average.
The Zacks Consensus Estimate for Conagra Brands’ current financial year sales and earnings suggests growth of 5.2% and 3.4%, respectively, from the corresponding year-ago reported figures.
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Campbell (CPB) Beats on Q1 Earnings & Sales, Raises FY23 View
Campbell Soup Company (CPB - Free Report) reported stellar first-quarter fiscal 2023 results, with the top and the bottom line surpassing the Zacks Consensus Estimate and increasing year over year.
Taking into account its solid first-quarter results that reflect continued demand and enhanced supply chain execution, management raised its fiscal 2023 net sales, adjusted earnings Before Interest and Taxes (EBIT) and adjusted earnings per share (EPS) view. The outlook also reflects the dynamic economic environment.
In the quarter, the company generated $10 million in savings under its multi-year cost-saving program, including Snyder’s-Lance synergies, bringing total program-to-date cost savings to $860 million. Management remains on track to deliver savings worth $1 billion by fiscal 2025-end.
Quarterly Highlights
Adjusted earnings from continuing operations increased 15% year over year to $1.02 per share, mainly reflecting a rise in adjusted EBIT and somewhat offset by a rise in the adjusted effective tax rate. The metric surpassed the Zacks Consensus Estimate of 86 cents.
Net sales of $2,575 million increased 15% year over year and surpassed the Zacks Consensus Estimate of $2,427.5 million. Organic net sales grew 15% year over year. The upside can be attributed to brand strength, inflation-driven pricing and continued supply recovery.
Image Source: Zacks Investment Research
The company’s adjusted gross profit rose to $829 million from $727 million reported in the year-ago quarter. Adjusted gross profit margin contracted 30 basis points (bps) to 32.2% due to continued cost inflation and increased other supply chain costs as well as unfavorable volume/ mix. Nevertheless, inflation-driven pricing actions and productivity improvements offered some respite.
Adjusted EBIT grew 15% to reach $449 million mainly driven by increased adjusted gross profit. These were somewhat offset by rising marketing and selling expenses as well as increased adjusted other expenses.
Segmental Analysis
Meals & Beverages: Net sales increased 15% year over year to $1,455 million. Organic sales also rose 15%, mainly due to a rise in U.S. retail products that include U.S. soup and Prego pasta sauces and benefits from foodservice. Inflation-driven pricing, sales allowances and reduced promotional spending were somewhat mitigated by volume declines. Sales of U.S. soup increased 11% led by a sales rise in ready-to-serve soups, condensed soups and broth. Operating earnings in the unit jumped 18%.
Snacks: Net sales in the division rose 15% (also organically) to $1,120 million. The upside can be attributed to sales of power brands which rose 21%. Sales growth was fueled by a rise in cookies and crackers, specifically Goldfish crackers and in salty snacks, Snyder's of Hanover pretzels as well as Kettle Brand and CapeCod potato chips. Inflation-driven pricing and sales allowances were somewhat offset by soft volume and higher promotional spending. Segmental operating earnings increased 20%.
Other Financial Details
As of Oct 30, 2022, Campbell's total cash and cash equivalents stood at $130 million, long-term debt was $3,994 million, and total equity amounted to $3,469 million. CPB generated $227 million as cash flow from operations for three months ended Oct 30, 2022. Capital expenditure amounted to $77 million in the said period.
Management paid $115 million of cash dividends and bought back nearly $41 million in the reported quarter. At the end of the first quarter, it had nearly $375 million remaining under its current $500-million share repurchase plan and almost $131 million remaining under its $250 million anti-dilutive share repurchase plan.
Fiscal 2023 Guidance
For fiscal 2023, the company now expects 7-9% net sales growth, with 7-9% organic sales growth. Earlier, management had expected 4-6% net sales growth, with 4-6% organic sales growth for fiscal 2023. Adjusted EBIT is now forecast to be up 2.5-6.5% compared with the previous view of 1-5% growth. Adjusted EPS is now envisioned to be up 2-5% to come in at $2.90-$3.00. Earlier, adjusted EPS was projected to be flat to up 4%.
Shares of the Zacks Rank #3 (Hold) company have gained 10.8% in the past three months compared with the industry's growth of 7.9%.
3 Solid Staple Picks
Some top-ranked stocks are The Chef's Warehouse (CHEF - Free Report) , General Mills (GIS - Free Report) and Conagra Brands (CAG - Free Report) .
The Chef's Warehouse, which distributes specialty food products, currently sports a Zacks Rank #1 (Strong Buy). Chef's Warehouse has a trailing four-quarter earnings surprise of 93.8%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for CHEF’s current financial year sales suggests growth of 46.5% from the year-ago reported number, while earnings indicate significant growth.
General Mills, which manufactures and markets branded consumer foods, carries a Zacks Rank #2(Buy) at present. General Mills has a trailing four-quarter earnings surprise of 6.1%, on average.
The Zacks Consensus Estimate for GIS’ current financial year sales and earnings suggests growth of 2.7% and 3.8%, respectively, from the year-ago reported numbers.
Conagra Brands, operating as a consumer-packaged goods food company, currently carries a Zacks Rank of 2. CAG has a trailing four-quarter earnings surprise of 1.8%, on average.
The Zacks Consensus Estimate for Conagra Brands’ current financial year sales and earnings suggests growth of 5.2% and 3.4%, respectively, from the corresponding year-ago reported figures.