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We issued an updated research report on premium meat products company, Hormel Foods Corporation (HRL - Free Report) , on Aug 23, 2016. The company produces and sells a variety of meat and food products globally. Although the company enjoys a high brand value, it remains exposed to certain business headwinds.
Bullish Factors
Hormel Foods is steadily improving its aggregate revenues. Demand for the company’s major branded products like Old Smokehouse bacon, Hormel Fire Braised meat, Muscle Milk Protein products, Skippy & Spam products and Wholly Guacamole dips has rapidly grown over time. Hormel Foods expects higher demand for these popular products to drive sales growth in the quarters ahead.
Moreover, the company is enhancing its profitability on the back of its balanced business model. Superior product and process innovation, solid sales of value-added products and greater operational efficiency have been supporting earnings growth. Based on these bullish trends, Hormel Foods has raised its fiscal 2016 adjusted earnings guidance to the range of $1.60–$1.64 per share from the earlier projection of $1.56–$1.60 per share. Also, the latest acquisitions of Justin’s, LLC and Applegate are expected to boost the top line and the bottom line in the near term.
Existing Risks
Hormel Foods conducts its business in a highly competitive industry. Intense competition enhances the bargaining power of consumers and exposes the company to risks of market share loss. Moreover, the company's strategy to grow revenues and margins via increased business internationalization exposes it to several economic, political and environmental headwinds.
Other Stocks to Consider
Hormel Foods currently carries a Zacks Rank #2 (Buy). Other well-ranked stocks in the industry include Sanderson Farms, Inc. , Tyson Foods, Inc. (TSN - Free Report) and Activision Blizzard, Inc. . While Sanderson Farms, Inc. currently sports a Zacks Rank #1 (Strong Buy), both Tyson Foods, Inc. and Activision Blizzard, Inc. hold a Zacks Rank #2 (Buy).
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Hormel Foods (HRL) Growth Prospects Bright, Risks Minimal
We issued an updated research report on premium meat products company, Hormel Foods Corporation (HRL - Free Report) , on Aug 23, 2016. The company produces and sells a variety of meat and food products globally. Although the company enjoys a high brand value, it remains exposed to certain business headwinds.
Bullish Factors
Hormel Foods is steadily improving its aggregate revenues. Demand for the company’s major branded products like Old Smokehouse bacon, Hormel Fire Braised meat, Muscle Milk Protein products, Skippy & Spam products and Wholly Guacamole dips has rapidly grown over time. Hormel Foods expects higher demand for these popular products to drive sales growth in the quarters ahead.
Moreover, the company is enhancing its profitability on the back of its balanced business model. Superior product and process innovation, solid sales of value-added products and greater operational efficiency have been supporting earnings growth. Based on these bullish trends, Hormel Foods has raised its fiscal 2016 adjusted earnings guidance to the range of $1.60–$1.64 per share from the earlier projection of $1.56–$1.60 per share. Also, the latest acquisitions of Justin’s, LLC and Applegate are expected to boost the top line and the bottom line in the near term.
Existing Risks
Hormel Foods conducts its business in a highly competitive industry. Intense competition enhances the bargaining power of consumers and exposes the company to risks of market share loss. Moreover, the company's strategy to grow revenues and margins via increased business internationalization exposes it to several economic, political and environmental headwinds.
Other Stocks to Consider
Hormel Foods currently carries a Zacks Rank #2 (Buy). Other well-ranked stocks in the industry include Sanderson Farms, Inc. , Tyson Foods, Inc. (TSN - Free Report) and Activision Blizzard, Inc. . While Sanderson Farms, Inc. currently sports a Zacks Rank #1 (Strong Buy), both Tyson Foods, Inc. and Activision Blizzard, Inc. hold a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.Click to get this free report >>