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B&G Foods (BGS) to Report Q1 Earnings: What's in Store?
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B&G Foods Inc. (BGS - Free Report) is set to report first-quarter 2017 results on May 4, after market close.
Last quarter, this NJ-based shelf-stable and frozen food company posted a negative earnings surprise of 29.27%. However, the company missed estimates in only one out of the past four quarters, resulting in an average positive surprise of 7.45%.
Let’s see how things are shaping up for this announcement.
Factors to Consider
We are particularly concerned about B&G Foods’ weak base business growth. The company's base sales declined 2% in 2016, thanks to falling unit volumes. Also, the North American food industry has been witnessing sluggish growth and slowdown in consumption over the last few quarters due to a soft consumer spending environment.
For the to-be reported quarter, B&G Foods has seen one downward estimate revision versus no revision in the opposite direction, dragging the Zacks Consensus Estimate down to 55 cents a share (15.4% year over year decline) from 57 cents over the past 30 days. The stock also saw dismal trading over the past three months, with the share price slipping 6.5%.
However, we are encouraged by the company’s aggressive acquisition strategy, which has been a key growth driver for B&G Foods. In 2016, the company's sales increased 44%, primarily on acquisitions.
In Dec 2016, B&G Foods took over Victoria Fine Foods Holding Company and Victoria Fine Foods, LLC, for roughly $70 million in cash. This follows the acquisition of the spices and seasonings business of ACH Food Companies, Inc. in Nov 2016. These acquisitions are expected to contribute significantly to the soon-to-be-reported quarter. Notably, the Zacks Consensus Estimate for revenues is pegged at $416.5 million, implying an 18% increase.
Earnings Whispers
Our proven model does not conclusively show that B&G Foods will beat estimates this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. But that is not the case here, as you will see below. You can see the complete list of today’s Zacks #1 Rank stocks here.
Zacks ESP: B&G Foods’ Earnings ESP is 0.00% as both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 55 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: B&G Foods has a Zacks Rank #4 (Sell). Note that we caution against stocks with a Zacks Rank #4 or 5 (Strong Sell) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Peer Releases
Dr Pepper Snapple Group Inc. recently reported first-quarter 2017 results, with earnings beating the Zacks Consensus Estimate and revenues missing the mark. While sales were driven by 1% volume growth, unfavorable foreign currency translation and adverse segment mix hurt sales by 1%.
The Hershey Company’s (HSY - Free Report) first-quarter 2017 earnings beat the Zacks Consensus Estimate while sales missed the same by 3.9% and 1.1%, respectively. Earnings benefited from higher demand in the U.S.
PepsiCo, Inc. (PEP - Free Report) reported better-than-expected results in first-quarter 2017, with both earnings and revenues beating the Zacks Consensus Estimate. Positive price realization, cost-cutting initiatives and a healthier snacks lineup helped the company post better-than-expected results.
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Image: Bigstock
B&G Foods (BGS) to Report Q1 Earnings: What's in Store?
B&G Foods Inc. (BGS - Free Report) is set to report first-quarter 2017 results on May 4, after market close.
Last quarter, this NJ-based shelf-stable and frozen food company posted a negative earnings surprise of 29.27%. However, the company missed estimates in only one out of the past four quarters, resulting in an average positive surprise of 7.45%.
Let’s see how things are shaping up for this announcement.
Factors to Consider
We are particularly concerned about B&G Foods’ weak base business growth. The company's base sales declined 2% in 2016, thanks to falling unit volumes. Also, the North American food industry has been witnessing sluggish growth and slowdown in consumption over the last few quarters due to a soft consumer spending environment.
For the to-be reported quarter, B&G Foods has seen one downward estimate revision versus no revision in the opposite direction, dragging the Zacks Consensus Estimate down to 55 cents a share (15.4% year over year decline) from 57 cents over the past 30 days. The stock also saw dismal trading over the past three months, with the share price slipping 6.5%.
However, we are encouraged by the company’s aggressive acquisition strategy, which has been a key growth driver for B&G Foods. In 2016, the company's sales increased 44%, primarily on acquisitions.
In Dec 2016, B&G Foods took over Victoria Fine Foods Holding Company and Victoria Fine Foods, LLC, for roughly $70 million in cash. This follows the acquisition of the spices and seasonings business of ACH Food Companies, Inc. in Nov 2016. These acquisitions are expected to contribute significantly to the soon-to-be-reported quarter. Notably, the Zacks Consensus Estimate for revenues is pegged at $416.5 million, implying an 18% increase.
Earnings Whispers
Our proven model does not conclusively show that B&G Foods will beat estimates this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. But that is not the case here, as you will see below. You can see the complete list of today’s Zacks #1 Rank stocks here.
Zacks ESP: B&G Foods’ Earnings ESP is 0.00% as both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 55 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
B&G Foods, Inc. Price and EPS Surprise
B&G Foods, Inc. Price and EPS Surprise | B&G Foods, Inc. Quote
Zacks Rank: B&G Foods has a Zacks Rank #4 (Sell). Note that we caution against stocks with a Zacks Rank #4 or 5 (Strong Sell) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Peer Releases
Dr Pepper Snapple Group Inc. recently reported first-quarter 2017 results, with earnings beating the Zacks Consensus Estimate and revenues missing the mark. While sales were driven by 1% volume growth, unfavorable foreign currency translation and adverse segment mix hurt sales by 1%.
The Hershey Company’s (HSY - Free Report) first-quarter 2017 earnings beat the Zacks Consensus Estimate while sales missed the same by 3.9% and 1.1%, respectively. Earnings benefited from higher demand in the U.S.
PepsiCo, Inc. (PEP - Free Report) reported better-than-expected results in first-quarter 2017, with both earnings and revenues beating the Zacks Consensus Estimate. Positive price realization, cost-cutting initiatives and a healthier snacks lineup helped the company post better-than-expected results.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
See This Ticker Free >>