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General Mills (GIS) Looks Solid: Up More Than 10% in 3 Months
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General Mills, Inc. (GIS - Free Report) appears a tempting pick, with its shares up nearly 13% in the past three months compared with the industry’s growth of 2.8%. The company has been benefiting from its focus on the Accelerate strategy, as evident in its third-quarter fiscal 2023 results, wherein the top and bottom lines advanced year over year and came ahead of the Zacks Consensus Estimate.
This Zacks Rank #2 (Buy) company raised its guidance for fiscal 2023 again due to a robust year-to-date show and good indications regarding the fourth quarter. The Zacks Consensus Estimate for the current fiscal-year earnings per share (EPS) has risen from $4.18 to $4.23 over the past 30 days.
Let’s delve deeper.
General Mills, Inc. Price, Consensus and EPS Surprise
General Mills posted adjusted earnings of 97 cents per share, which beat the Zacks Consensus Estimate of 91 cents. The bottom line rose 17% year over year on a constant-currency (cc) basis. The upside can be mainly attributed to the elevated adjusted operating profit and decreased net shares outstanding.
The company reported net sales of $5,125.9 million, which beat the Zacks Consensus Estimate of $4,913 million. The top line advanced 13% from the year-ago quarter’s figure. Organic net sales rose 16% due to the favorable organic net price realization and mix, with the organic pound volume remaining nearly flat with the year-ago period’s level.
GIS is managing well amid supply-chain headwinds and a volatile operating landscape. For fiscal 2023, organic net sales are now anticipated to increase 10-11%, up from the nearly 10% growth expected earlier. We expect organic sales to grow 10.4% in fiscal 2023.
Management now anticipates adjusted operating profit growth of 7-8% at cc. Earlier, the metric was anticipated between 6% and 7%. Adjusted EPS growth at cc is now envisioned between 8% and 9%. Previously, adjusted EPS growth at cc was expected to rise 7-8%.
Accelerate Strategy & Strong Pet Segment
General Mills is focused on its Accelerate strategy (unveiled in February 2021), which aids it in making the choices of how to win and where to play to boost profitability while enhancing shareholder returns in the long run. Under how to win, General Mills is focused on four pillars designed to provide a competitive advantage. These include brand building, undertaking innovations, unleashing scale and maintaining business strength.
The where-to-play principle is outlined to enhance the company’s capabilities to generate profitability through geographic and product prioritization, along with portfolio restructuring. This includes prioritizing investments, investing in five Global Platforms, driving growth in local gem brands and reshaping the portfolio.
For fiscal 2023, GIS remains committed to the Accelerate strategy, underscored by its three priorities — competing efficiently through brand building, investing in Holistic Margin Management and Strategic Revenue Management initiatives to counter inflation, making other strategic business investments, staying committed to ESG goals and reshaping the portfolio. It expects HMM cost savings of 3-4% of the cost of goods sold in fiscal 2023.
A higher pet population and more humanization and premiumization of pet food have been acting as tailwinds for the company’s pet food category. In the third quarter of fiscal 2023, segment revenues came in at $645.5 million, which ascended 14% year over year due to the positive net price realization and mix and the higher pound volume.
Organic sales also rose 14%. Segment net sales increased sequentially, backed by enhanced customer service, improved brand-building and other commercial activities, as well as the restocking of retailer inventory.
The continuation of the abovementioned upsides, along with a focus on innovation, is likely to help General Mills battle cost-related hurdles and remain on the growth trajectory.
Lamb Weston, which operates as a frozen potato product company, currently sports a Zacks Rank #1 (Strong Buy). LW has a trailing four-quarter earnings surprise of 47.6%, 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 fiscal-year EPS suggests an increase of 94.7% from the year-ago reported number.
Post Holdings, a consumer-packaged goods holding company, currently sports a Zacks Rank #1. POST has a trailing four-quarter earnings surprise of 34.8%, on average.
The Zacks Consensus Estimate for Post Holdings’ current fiscal-year sales and earnings suggests growth of 2.2% and 112.5%, respectively, from the corresponding year-ago reported figures.
Conagra Brands, which operates as a consumer-packaged goods food company, currently carries a Zacks Rank #2. CAG has a trailing four-quarter earnings surprise of 13.2%, on average.
The Zacks Consensus Estimate for Conagra Brands’ current fiscal-year sales and earnings suggests an increase of 7% and 15.7%, respectively, from the year-ago reported number.
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General Mills (GIS) Looks Solid: Up More Than 10% in 3 Months
General Mills, Inc. (GIS - Free Report) appears a tempting pick, with its shares up nearly 13% in the past three months compared with the industry’s growth of 2.8%. The company has been benefiting from its focus on the Accelerate strategy, as evident in its third-quarter fiscal 2023 results, wherein the top and bottom lines advanced year over year and came ahead of the Zacks Consensus Estimate.
This Zacks Rank #2 (Buy) company raised its guidance for fiscal 2023 again due to a robust year-to-date show and good indications regarding the fourth quarter. The Zacks Consensus Estimate for the current fiscal-year earnings per share (EPS) has risen from $4.18 to $4.23 over the past 30 days.
Let’s delve deeper.
General Mills, Inc. Price, Consensus and EPS Surprise
General Mills, Inc. price-consensus-eps-surprise-chart | General Mills, Inc. Quote
Strong Q3 & Guidance
General Mills posted adjusted earnings of 97 cents per share, which beat the Zacks Consensus Estimate of 91 cents. The bottom line rose 17% year over year on a constant-currency (cc) basis. The upside can be mainly attributed to the elevated adjusted operating profit and decreased net shares outstanding.
The company reported net sales of $5,125.9 million, which beat the Zacks Consensus Estimate of $4,913 million. The top line advanced 13% from the year-ago quarter’s figure. Organic net sales rose 16% due to the favorable organic net price realization and mix, with the organic pound volume remaining nearly flat with the year-ago period’s level.
GIS is managing well amid supply-chain headwinds and a volatile operating landscape. For fiscal 2023, organic net sales are now anticipated to increase 10-11%, up from the nearly 10% growth expected earlier. We expect organic sales to grow 10.4% in fiscal 2023.
Management now anticipates adjusted operating profit growth of 7-8% at cc. Earlier, the metric was anticipated between 6% and 7%. Adjusted EPS growth at cc is now envisioned between 8% and 9%. Previously, adjusted EPS growth at cc was expected to rise 7-8%.
Accelerate Strategy & Strong Pet Segment
General Mills is focused on its Accelerate strategy (unveiled in February 2021), which aids it in making the choices of how to win and where to play to boost profitability while enhancing shareholder returns in the long run. Under how to win, General Mills is focused on four pillars designed to provide a competitive advantage. These include brand building, undertaking innovations, unleashing scale and maintaining business strength.
The where-to-play principle is outlined to enhance the company’s capabilities to generate profitability through geographic and product prioritization, along with portfolio restructuring. This includes prioritizing investments, investing in five Global Platforms, driving growth in local gem brands and reshaping the portfolio.
For fiscal 2023, GIS remains committed to the Accelerate strategy, underscored by its three priorities — competing efficiently through brand building, investing in Holistic Margin Management and Strategic Revenue Management initiatives to counter inflation, making other strategic business investments, staying committed to ESG goals and reshaping the portfolio. It expects HMM cost savings of 3-4% of the cost of goods sold in fiscal 2023.
A higher pet population and more humanization and premiumization of pet food have been acting as tailwinds for the company’s pet food category. In the third quarter of fiscal 2023, segment revenues came in at $645.5 million, which ascended 14% year over year due to the positive net price realization and mix and the higher pound volume.
Organic sales also rose 14%. Segment net sales increased sequentially, backed by enhanced customer service, improved brand-building and other commercial activities, as well as the restocking of retailer inventory.
The continuation of the abovementioned upsides, along with a focus on innovation, is likely to help General Mills battle cost-related hurdles and remain on the growth trajectory.
Other Solid Picks
Some other top-ranked consumer staple stocks are Lamb Weston (LW - Free Report) , Post Holdings (POST - Free Report) and Conagra Brands (CAG - Free Report) .
Lamb Weston, which operates as a frozen potato product company, currently sports a Zacks Rank #1 (Strong Buy). LW has a trailing four-quarter earnings surprise of 47.6%, 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 fiscal-year EPS suggests an increase of 94.7% from the year-ago reported number.
Post Holdings, a consumer-packaged goods holding company, currently sports a Zacks Rank #1. POST has a trailing four-quarter earnings surprise of 34.8%, on average.
The Zacks Consensus Estimate for Post Holdings’ current fiscal-year sales and earnings suggests growth of 2.2% and 112.5%, respectively, from the corresponding year-ago reported figures.
Conagra Brands, which operates as a consumer-packaged goods food company, currently carries a Zacks Rank #2. CAG has a trailing four-quarter earnings surprise of 13.2%, on average.
The Zacks Consensus Estimate for Conagra Brands’ current fiscal-year sales and earnings suggests an increase of 7% and 15.7%, respectively, from the year-ago reported number.