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.
B&G Foods (BGS) Gains on Innovation and Operational Efficiency
Read MoreHide Full Article
B&G Foods, Inc. (BGS - Free Report) has enhanced its innovation pipeline by introducing the latest licensed seasoning and grilling blends under its well-known brands. The company has strategically advanced by reshaping its portfolio through divestitures, and concentrating on segments with higher margins and growth potential. These measures are crucial for aligning B&G Foods with prevailing market trends and consumer preferences, thus improving its competitive stance.
The company has reinvigorated its innovation pipeline with the introduction of the latest licensing seasoning and grilling blends under the Buffalo Trace, Fireball and Southern Comfort brands, which have been well-received in initial distributions. These launches underscore BGS’s commitment to diversifying its product lineup and maintaining relevance in evolving market trends. This strategy not only strengthens its competitive position but also creates opportunities for growth and consumer engagement.
The company achieved a significant inventory reduction in fiscal 2023, underscoring its dedication to optimizing inventory levels and enhancing service quality. This reduction resulted from strategic divestitures, decreased commodity costs and improved operational efficiencies.
In the fourth quarter of 2023, B&G Foods saw a notable improvement in profit margins, with a 130-basis-point increase in the adjusted gross margin to 21.9%, demonstrating its ability to effectively manage pricing amid rising costs and capitalize on productivity gains.
Image Source: Zacks Investment Research
Debt-Reduction Strategy
B&G Foods made significant strides in reducing its net debt by $335 million in 2023 through enhanced cash flow and proceeds from divestitures. This strategic debt reduction led to a lower pro-forma adjusted net leverage ratio, reflecting the company's disciplined approach to debt management and its commitment to improving its leverage profile as part of its long-term financial strategy to enhance shareholder value.
Furthermore, the company reported a substantial increase in net cash from operations, which soared from $6 million the previous year to $248 million in 2023. This surge, driven by stronger operational performance and effective working capital management, highlights B&G Foods' focus on boosting liquidity and operational efficiency.
Zacks Rank & Estimate Trend
Shares of this Zacks Rank #2 (Buy) company have gained 25.4% in the past six months compared with the industry’s 10.3% growth. The Zacks Consensus Estimate for earnings per share in the current and next fiscal years has increased by 5 cents each to 84 cents and 90 cents in the past 60 days, respectively.
Cost Hurdles
B&G Foods has faced challenges with rising selling, general, and administrative (SG&A) expenses. In the fourth quarter of fiscal 2023, the company’s SG&A expenses increased 2.7% to $53.2 million, driven by higher general and administrative costs, and consumer marketing expenses. As a percentage of net sales, SG&A expenses rose 0.9 percentage points to 9.2%.
Despite these challenges, the company has been committed to operational streamlining and enhancing financial performance, aiming for sustainable long-term success.
The Zacks Consensus Estimate for Celsius Holdings’ current financial-year sales and earnings suggests growth of 41.6% each from the year-ago reported numbers.
Vital Farms (VITL - Free Report) offers a range of produced pasture-raised foods. It currently carries a Zacks Rank #2. VITL has a trailing four-quarter earnings surprise of 155.4%, on average.
The Zacks Consensus Estimate for Vital Farms’ current financial-year sales and earnings suggests growth of 18.7% and 30.5%, respectively, from the year-ago reported figures.
Freshpet Inc. (FRPT - Free Report) is a pet food company. It currently has a Zacks Rank #2. FRPT has a trailing four-quarter average earnings surprise of 61.8%.
The Zacks Consensus Estimate for Freshpet’s current financial-year sales and earnings suggests growth of 24.3% and 110%, respectively, from the year-ago reported numbers.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
B&G Foods (BGS) Gains on Innovation and Operational Efficiency
B&G Foods, Inc. (BGS - Free Report) has enhanced its innovation pipeline by introducing the latest licensed seasoning and grilling blends under its well-known brands. The company has strategically advanced by reshaping its portfolio through divestitures, and concentrating on segments with higher margins and growth potential. These measures are crucial for aligning B&G Foods with prevailing market trends and consumer preferences, thus improving its competitive stance.
The company has reinvigorated its innovation pipeline with the introduction of the latest licensing seasoning and grilling blends under the Buffalo Trace, Fireball and Southern Comfort brands, which have been well-received in initial distributions. These launches underscore BGS’s commitment to diversifying its product lineup and maintaining relevance in evolving market trends. This strategy not only strengthens its competitive position but also creates opportunities for growth and consumer engagement.
The company achieved a significant inventory reduction in fiscal 2023, underscoring its dedication to optimizing inventory levels and enhancing service quality. This reduction resulted from strategic divestitures, decreased commodity costs and improved operational efficiencies.
In the fourth quarter of 2023, B&G Foods saw a notable improvement in profit margins, with a 130-basis-point increase in the adjusted gross margin to 21.9%, demonstrating its ability to effectively manage pricing amid rising costs and capitalize on productivity gains.
Image Source: Zacks Investment Research
Debt-Reduction Strategy
B&G Foods made significant strides in reducing its net debt by $335 million in 2023 through enhanced cash flow and proceeds from divestitures. This strategic debt reduction led to a lower pro-forma adjusted net leverage ratio, reflecting the company's disciplined approach to debt management and its commitment to improving its leverage profile as part of its long-term financial strategy to enhance shareholder value.
Furthermore, the company reported a substantial increase in net cash from operations, which soared from $6 million the previous year to $248 million in 2023. This surge, driven by stronger operational performance and effective working capital management, highlights B&G Foods' focus on boosting liquidity and operational efficiency.
Zacks Rank & Estimate Trend
Shares of this Zacks Rank #2 (Buy) company have gained 25.4% in the past six months compared with the industry’s 10.3% growth. The Zacks Consensus Estimate for earnings per share in the current and next fiscal years has increased by 5 cents each to 84 cents and 90 cents in the past 60 days, respectively.
Cost Hurdles
B&G Foods has faced challenges with rising selling, general, and administrative (SG&A) expenses. In the fourth quarter of fiscal 2023, the company’s SG&A expenses increased 2.7% to $53.2 million, driven by higher general and administrative costs, and consumer marketing expenses. As a percentage of net sales, SG&A expenses rose 0.9 percentage points to 9.2%.
Despite these challenges, the company has been committed to operational streamlining and enhancing financial performance, aiming for sustainable long-term success.
Other Food Bets
Celsius Holdings (CELH - Free Report) , which offers functional drinks and liquid supplements, currently carries a Zacks Rank #2. CELH has a trailing four-quarter earnings surprise of 67.4%, on average. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Celsius Holdings’ current financial-year sales and earnings suggests growth of 41.6% each from the year-ago reported numbers.
Vital Farms (VITL - Free Report) offers a range of produced pasture-raised foods. It currently carries a Zacks Rank #2. VITL has a trailing four-quarter earnings surprise of 155.4%, on average.
The Zacks Consensus Estimate for Vital Farms’ current financial-year sales and earnings suggests growth of 18.7% and 30.5%, respectively, from the year-ago reported figures.
Freshpet Inc. (FRPT - Free Report) is a pet food company. It currently has a Zacks Rank #2. FRPT has a trailing four-quarter average earnings surprise of 61.8%.
The Zacks Consensus Estimate for Freshpet’s current financial-year sales and earnings suggests growth of 24.3% and 110%, respectively, from the year-ago reported numbers.