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What's in Store for International Flavors' (IFF) Q4 Earnings?
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International Flavors & Fragrances Inc. (IFF - Free Report) is scheduled to report fourth-quarter 2022 results on Feb 08, after the closing bell.
Q3 Performance
In the last reported quarter, International Flavors’ earnings and revenues beat the Zacks Consensus Estimates. On a year-over-year basis, earnings declined, while revenues were flat. The company has surpassed earnings estimates in the trailing four quarters, the average surprise being 11.9%.
International Flavors & Fragrances Inc. Price and EPS Surprise
The Zacks Consensus Estimate for fourth-quarter revenues is pegged at $3.88 billion, indicating a decline of 5% from the year-ago reported figure. The Zacks Consensus Estimate for the December-end quarter’s earnings per share is pegged at 94 cents, suggesting a year-over-year decline of 14.5%.
Key Factors to Note
International Flavors has been bearing the brunt of unfavorable foreign exchange and persisting inflation, as well as the current challenging operating environment. Based on current market foreign exchange rates, International Flavors expected foreign exchange to negatively impact sales growth and adjusted operating EBITDA growth in the quarter to be reported. The company also anticipated fourth-quarter 2022 volumes to deteriorate.
However, the headwinds are expected to have been partially offset by favorable markets for flavors and fragrances, supported by the demand for various consumer products and growth in emerging markets. Greater efficiencies throughout the business on costs and productivity initiatives, margin improvement, and acquisition-related synergies are likely to have driven growth in the quarter under review quarter.
The Nourish segment has been delivering strong results, primarily driven by the Flavors, Ingredients and Food Design businesses. However, these tailwinds are likely to have been offset by lower volumes in the to-be-reported quarter. The Zacks Consensus Estimate for the segment’s sales for the fourth quarter is pegged at $1,624 million, indicating a year-over-year 0.1% fall. The consensus mark for the segment’s operating EBITDA is pegged at $242 million compared with the prior-year quarter’s $251 million.
The Scent segment has been witnessing sustained strength in Cosmetic Actives and Consumer Fragrances. Volumes have significantly picked up in the Fine Fragrance business, with consumer behavior returning to normal levels. The Zacks Consensus Estimate for the segment’s sales for the fourth quarter is pegged at $551 million, whereas it reported $555 million in the year-ago quarter. The estimate for operating EBITDA for the segment is at $86 million, indicating a year-over-year decline of 2.2%.
The Zacks Consensus Estimate for the Health & Biosciences segment’s sales for the fourth quarter is pegged at $517 million, suggesting a year-over-year decline of 20%. The estimate for the segment’s operating EBITDA is pegged at $129 million, down 17.3% from the year-ago quarter.
Strong growth in Industrial Pharma and the ongoing recovery in demand in Pharma are expected to have supported the Pharma Solutions segment in the to-be-reported quarter. The Zacks Consensus Estimate for the segment’s fourth-quarter sales is pegged at $205 million compared with the prior-year quarter’s $204 million. The estimate for the segment’s operating EBITDA stands at $42 million, indicating a year-over-year increase of 23.5%.
High raw material, energy and labor costs are likely to have impacted the company’s margins in the fourth quarter. Manufacturing expenses are anticipated to have been higher due to the company’s efforts to meet the current high demand levels.
Labor shortages and supply-chain disruptions are likely to have impacted the company’s production in the to-be-reported quarter. Despite its pricing actions and cost-reduction efforts, these factors are likely to have weighed on the company’s margins in the quarter under review.
Earnings Whispers
Our proven model doesn’t conclusively predict an earnings beat for International Flavors this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.
You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
Earnings ESP: The Earnings ESP for International Flavors is -0.35%.
In the past year, International Flavors’ shares have declined 11.5% compared with the industry’s fall of 12.5%.
Image Source: Zacks Investment Research
Stocks to Consider
Here are some Consumer Staples stocks, which, according to our model, have the right combination of elements to post an earnings beat in their upcoming releases:
Conagra Brands, Inc. (CAG - Free Report) has an Earnings ESP of +0.30% and currently sports a Zacks Rank #1. The Zacks Consensus Estimate for CAG’s quarterly revenues is pegged at $3.09 billion for third-quarter fiscal 2023, indicating an improvement of 5.8% from the figure reported in the prior-year quarter.
The Zacks Consensus Estimate for its bottom line has moved up 6.7% in the past 60 days to 64 cents per share. The estimate suggests an increase of 10.34% from the year-ago quarter’s reported figure. CAG has delivered an earnings beat of 8.9%, on average, in the trailing four quarters.
Calavo Growers, Inc. (CVGW - Free Report) currently has an Earnings ESP of +8.33% and a Zacks Rank #3. The Zacks Consensus Estimate for quarterly revenues is pegged at $276 million, which suggests growth of 0.9% from the figure reported in the prior-year quarter.
The Zacks Consensus Estimate for CVGW’s first-quarter fiscal 2023 earnings has moved down 4% in the past 60 days to 24 cents per share. The estimate suggests an improvement of 1300% from the year-ago quarter’s reported number.
PepsiCo, Inc. (PEP - Free Report) currently has an Earnings ESP of +0.05% and a Zacks Rank of 3. The Zacks Consensus Estimate for PEP’s fourth-quarter 2022 revenues is pegged at $26.8 billion, which suggests growth of 6.2% from the prior-year quarter’s reported figure.
The Zacks Consensus Estimate for its quarterly earnings has been unchanged in the past 60 days at $1.64 per share. The estimate suggests 7.2% growth from the year-ago reported number. PEP has delivered an earnings beat of 4.5%, on average, in the trailing four quarters.
Image: Bigstock
What's in Store for International Flavors' (IFF) Q4 Earnings?
International Flavors & Fragrances Inc. (IFF - Free Report) is scheduled to report fourth-quarter 2022 results on Feb 08, after the closing bell.
Q3 Performance
In the last reported quarter, International Flavors’ earnings and revenues beat the Zacks Consensus Estimates. On a year-over-year basis, earnings declined, while revenues were flat. The company has surpassed earnings estimates in the trailing four quarters, the average surprise being 11.9%.
International Flavors & Fragrances Inc. Price and EPS Surprise
International Flavors & Fragrances Inc. price-eps-surprise | International Flavors & Fragrances Inc. Quote
Q4 Estimates
The Zacks Consensus Estimate for fourth-quarter revenues is pegged at $3.88 billion, indicating a decline of 5% from the year-ago reported figure. The Zacks Consensus Estimate for the December-end quarter’s earnings per share is pegged at 94 cents, suggesting a year-over-year decline of 14.5%.
Key Factors to Note
International Flavors has been bearing the brunt of unfavorable foreign exchange and persisting inflation, as well as the current challenging operating environment. Based on current market foreign exchange rates, International Flavors expected foreign exchange to negatively impact sales growth and adjusted operating EBITDA growth in the quarter to be reported. The company also anticipated fourth-quarter 2022 volumes to deteriorate.
However, the headwinds are expected to have been partially offset by favorable markets for flavors and fragrances, supported by the demand for various consumer products and growth in emerging markets. Greater efficiencies throughout the business on costs and productivity initiatives, margin improvement, and acquisition-related synergies are likely to have driven growth in the quarter under review quarter.
The Nourish segment has been delivering strong results, primarily driven by the Flavors, Ingredients and Food Design businesses. However, these tailwinds are likely to have been offset by lower volumes in the to-be-reported quarter. The Zacks Consensus Estimate for the segment’s sales for the fourth quarter is pegged at $1,624 million, indicating a year-over-year 0.1% fall. The consensus mark for the segment’s operating EBITDA is pegged at $242 million compared with the prior-year quarter’s $251 million.
The Scent segment has been witnessing sustained strength in Cosmetic Actives and Consumer Fragrances. Volumes have significantly picked up in the Fine Fragrance business, with consumer behavior returning to normal levels. The Zacks Consensus Estimate for the segment’s sales for the fourth quarter is pegged at $551 million, whereas it reported $555 million in the year-ago quarter. The estimate for operating EBITDA for the segment is at $86 million, indicating a year-over-year decline of 2.2%.
The Zacks Consensus Estimate for the Health & Biosciences segment’s sales for the fourth quarter is pegged at $517 million, suggesting a year-over-year decline of 20%. The estimate for the segment’s operating EBITDA is pegged at $129 million, down 17.3% from the year-ago quarter.
Strong growth in Industrial Pharma and the ongoing recovery in demand in Pharma are expected to have supported the Pharma Solutions segment in the to-be-reported quarter. The Zacks Consensus Estimate for the segment’s fourth-quarter sales is pegged at $205 million compared with the prior-year quarter’s $204 million. The estimate for the segment’s operating EBITDA stands at $42 million, indicating a year-over-year increase of 23.5%.
High raw material, energy and labor costs are likely to have impacted the company’s margins in the fourth quarter. Manufacturing expenses are anticipated to have been higher due to the company’s efforts to meet the current high demand levels.
Labor shortages and supply-chain disruptions are likely to have impacted the company’s production in the to-be-reported quarter. Despite its pricing actions and cost-reduction efforts, these factors are likely to have weighed on the company’s margins in the quarter under review.
Earnings Whispers
Our proven model doesn’t conclusively predict an earnings beat for International Flavors this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.
You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
Earnings ESP: The Earnings ESP for International Flavors is -0.35%.
Zacks Rank: International Flavors currently carries a Zacks Rank #3. You can see the complete list of today's Zacks #1 Rank stocks here.
Price Performance
In the past year, International Flavors’ shares have declined 11.5% compared with the industry’s fall of 12.5%.
Image Source: Zacks Investment Research
Stocks to Consider
Here are some Consumer Staples stocks, which, according to our model, have the right combination of elements to post an earnings beat in their upcoming releases:
Conagra Brands, Inc. (CAG - Free Report) has an Earnings ESP of +0.30% and currently sports a Zacks Rank #1. The Zacks Consensus Estimate for CAG’s quarterly revenues is pegged at $3.09 billion for third-quarter fiscal 2023, indicating an improvement of 5.8% from the figure reported in the prior-year quarter.
The Zacks Consensus Estimate for its bottom line has moved up 6.7% in the past 60 days to 64 cents per share. The estimate suggests an increase of 10.34% from the year-ago quarter’s reported figure. CAG has delivered an earnings beat of 8.9%, on average, in the trailing four quarters.
Calavo Growers, Inc. (CVGW - Free Report) currently has an Earnings ESP of +8.33% and a Zacks Rank #3. The Zacks Consensus Estimate for quarterly revenues is pegged at $276 million, which suggests growth of 0.9% from the figure reported in the prior-year quarter.
The Zacks Consensus Estimate for CVGW’s first-quarter fiscal 2023 earnings has moved down 4% in the past 60 days to 24 cents per share. The estimate suggests an improvement of 1300% from the year-ago quarter’s reported number.
PepsiCo, Inc. (PEP - Free Report) currently has an Earnings ESP of +0.05% and a Zacks Rank of 3. The Zacks Consensus Estimate for PEP’s fourth-quarter 2022 revenues is pegged at $26.8 billion, which suggests growth of 6.2% from the prior-year quarter’s reported figure.
The Zacks Consensus Estimate for its quarterly earnings has been unchanged in the past 60 days at $1.64 per share. The estimate suggests 7.2% growth from the year-ago reported number. PEP has delivered an earnings beat of 4.5%, on average, in the trailing four quarters.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.