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Campbell Soup (CPB) Gains As Market Dips: What You Should Know

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Campbell Soup (CPB - Free Report) closed at $53.35 in the latest trading session, marking a +1.91% move from the prior day. This change outpaced the S&P 500's 2% loss on the day. Meanwhile, the Dow lost 2.06%, and the Nasdaq, a tech-heavy index, lost 2.32%.

Heading into today, shares of the maker of canned soup, Pepperidge Farm cookies and V8 juice had gained 1.49% over the past month, outpacing the Consumer Staples sector's gain of 0.32% and lagging the S&P 500's gain of 2.88% in that time.

Investors will be hoping for strength from Campbell Soup as it approaches its next earnings release. On that day, Campbell Soup is projected to report earnings of $0.73 per share, which would represent year-over-year growth of 5.8%. Meanwhile, our latest consensus estimate is calling for revenue of $2.44 billion, up 10.24% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $2.99 per share and revenue of $9.26 billion, which would represent changes of +4.91% and +8.15%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for Campbell Soup. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Campbell Soup is currently a Zacks Rank #3 (Hold).

Investors should also note Campbell Soup's current valuation metrics, including its Forward P/E ratio of 17.51. Its industry sports an average Forward P/E of 18.05, so we one might conclude that Campbell Soup is trading at a discount comparatively.

It is also worth noting that CPB currently has a PEG ratio of 5.16. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Food - Miscellaneous industry currently had an average PEG ratio of 2.88 as of yesterday's close.

The Food - Miscellaneous industry is part of the Consumer Staples sector. This group has a Zacks Industry Rank of 83, putting it in the top 33% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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