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Looking for a Solid Buy? Pick Central Garden & Pet (CENT)
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Central Garden & Pet Company (CENT - Free Report) looks promising on the back of its strategic efforts, robust earnings history and solid brand portfolio. This Zacks Rank #1 (Strong Buy) stock boasts a VGM Score of A with a long-term earnings growth rate of 10%.
In fact, shares of Central Garden & Pet have rallied 31.5% in the last one year, as against the industry’s decline of 1.8%. Meanwhile, the broader Consumer Discretionary sector that is currently placed at the top 31% of the Zacks classified sectors (5 out of 16), gained 13.4%.
Let’s now delve deep to get a detailed analysis for this promising stock.
Growth Initiatives
Central Garden & Pet is revamping its Pet and Garden segments. In fact, the company intends to have a balanced approach that encompasses revenue growth and cost reduction. Further, it plans to launch several products that appeal to customers as well as upgrade customer service.
Going forward, management expects its ongoing transformation efforts to yield results. Also, it is likely to gain market share in the home centers, mass market, grocery, specialty pet store and other independent channels.
Being the leading producer of garden and pet supplies products in the United States with a diversified brand portfolio, Central Garden & Pet is developing healthy commercial relationships with giant retailers such as Wal-Mart Stores, Inc. (WMT - Free Report) , The Home Depot, Inc. (HD - Free Report) and Lowe's Companies, Inc. (LOW - Free Report) . We believe this provides the company a significant opportunity to drive growth.
Stellar Earnings Streak & Performance
Central Garden & Pet has reported better-than-expected earnings for the 12th straight quarter in third-quarter fiscal 2017. Notably, the company has pulled off an impressive average positive earnings surprise of 122.2% in the trailing four quarters.
Central Garden & Pet Company Price, Consensus and EPS Surprise
Moreover, its top line has also surpassed the Zacks Consensus Estimate for the third straight quarter. Also, the top and bottom lines grew 11.7% and 21.6%, respectively, in the quarter.
Organic growth, value accretive acquisitions such as that of the pet bedding business and Segrest, along with divestment of non-strategic assets have been aiding the company to enhance portfolio, consequently resulting in improved performance.
In the reported quarter, the Pet and Garden segments delivered robust results. In fact, the company’s Pet segment recorded eighth successive quarter of organic sales growth primarily on the back of robust consumer brands performance.
Robust financial numbers also prompted management to provide an upbeat adjusted earnings projection for the fiscal year. Earnings per share are now anticipated to be $1.44 or more, up approximately 14.3% or higher from the prior year. It had earlier projected earnings of $1.37 per share.
Consequently, the Zacks Consensus Estimate of $1.51 for fiscal 2017 and $1.66 for fiscal 2018 moved up 6.3% and 4.4%, respectively, over the last 30 days.
Furthermore, the company’s gross margin has shown constant improvement since the last five quarters. The uptick can be attributed to its efforts toward improving manufacturing efficiency, exit from the holiday decor business.
Central Garden & Pet Vs Industry
From the above discussion, it is evident that Central Garden & Pet looks impressive and deserves a place in your portfolio now.
Since 1988, the Zacks system has more than doubled the S&P 500 with an average gain of +25% per year. With compounding, rebalancing, and exclusive of fees, it can turn thousands into millions of dollars.
But here's something even more remarkable: You can master this proven system without going to a single class or seminar. And then you can apply it to your portfolio in as little as 10 minutes a month.
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Looking for a Solid Buy? Pick Central Garden & Pet (CENT)
Central Garden & Pet Company (CENT - Free Report) looks promising on the back of its strategic efforts, robust earnings history and solid brand portfolio. This Zacks Rank #1 (Strong Buy) stock boasts a VGM Score of A with a long-term earnings growth rate of 10%.
In fact, shares of Central Garden & Pet have rallied 31.5% in the last one year, as against the industry’s decline of 1.8%. Meanwhile, the broader Consumer Discretionary sector that is currently placed at the top 31% of the Zacks classified sectors (5 out of 16), gained 13.4%.
Let’s now delve deep to get a detailed analysis for this promising stock.
Growth Initiatives
Central Garden & Pet is revamping its Pet and Garden segments. In fact, the company intends to have a balanced approach that encompasses revenue growth and cost reduction. Further, it plans to launch several products that appeal to customers as well as upgrade customer service.
Going forward, management expects its ongoing transformation efforts to yield results. Also, it is likely to gain market share in the home centers, mass market, grocery, specialty pet store and other independent channels.
Being the leading producer of garden and pet supplies products in the United States with a diversified brand portfolio, Central Garden & Pet is developing healthy commercial relationships with giant retailers such as Wal-Mart Stores, Inc. (WMT - Free Report) , The Home Depot, Inc. (HD - Free Report) and Lowe's Companies, Inc. (LOW - Free Report) . We believe this provides the company a significant opportunity to drive growth.
Stellar Earnings Streak & Performance
Central Garden & Pet has reported better-than-expected earnings for the 12th straight quarter in third-quarter fiscal 2017. Notably, the company has pulled off an impressive average positive earnings surprise of 122.2% in the trailing four quarters.
Central Garden & Pet Company Price, Consensus and EPS Surprise
Central Garden & Pet Company Price, Consensus and EPS Surprise | Central Garden & Pet Company Quote
Moreover, its top line has also surpassed the Zacks Consensus Estimate for the third straight quarter. Also, the top and bottom lines grew 11.7% and 21.6%, respectively, in the quarter.
Organic growth, value accretive acquisitions such as that of the pet bedding business and Segrest, along with divestment of non-strategic assets have been aiding the company to enhance portfolio, consequently resulting in improved performance.
In the reported quarter, the Pet and Garden segments delivered robust results. In fact, the company’s Pet segment recorded eighth successive quarter of organic sales growth primarily on the back of robust consumer brands performance.
Robust financial numbers also prompted management to provide an upbeat adjusted earnings projection for the fiscal year. Earnings per share are now anticipated to be $1.44 or more, up approximately 14.3% or higher from the prior year. It had earlier projected earnings of $1.37 per share.
Consequently, the Zacks Consensus Estimate of $1.51 for fiscal 2017 and $1.66 for fiscal 2018 moved up 6.3% and 4.4%, respectively, over the last 30 days.
Furthermore, the company’s gross margin has shown constant improvement since the last five quarters. The uptick can be attributed to its efforts toward improving manufacturing efficiency, exit from the holiday decor business.
Central Garden & Pet Vs Industry
From the above discussion, it is evident that Central Garden & Pet looks impressive and deserves a place in your portfolio now.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Zacks' 10-Minute Stock-Picking Secret
Since 1988, the Zacks system has more than doubled the S&P 500 with an average gain of +25% per year. With compounding, rebalancing, and exclusive of fees, it can turn thousands into millions of dollars.
But here's something even more remarkable: You can master this proven system without going to a single class or seminar. And then you can apply it to your portfolio in as little as 10 minutes a month.
Learn the secret >>