General Mills, Inc. (GIS - Free Report) , a producer of branded consumer food recently reached a 52-week high of $42.61 on Feb 7, 2013, on the back of strong second quarter results.
General Mills’ strong market share position in some leading food categories, its growing international presence, strategic acquisitions and focus on innovation and brand support, along with the cost saving efforts are the drivers of the stock.
The company reported a strong second quarter fiscal 2013, beating Zacks Consensus Estimates by 8.9%, on the back of recent acquisitions, better-than-expected sales and profits in the U.S. retail business and lower interest expenses and favorable taxes.
Revenues mostly benefited from acquisitions, mainly the purchase of Brazilian food maker Yoki Alimentos (in August 2012) and Yoplait Canada. The company has outpaced earnings estimates in three out of the last four quarters.
The company upped its fiscal 2013 adjusted earnings guidance to a range of $2.65–$2.67 from prior expectations of approximately $2.65 a share. Both sales and operating profits are expected to increase in the mid-single digit range.
Importantly, however, the guidance now includes the benefits from the Yoki and Yoplait Canada acquisitions, which were previously excluded from the outlook. The U.S. retail business is expected to deliver low single-digit sales growth while operating profit is expected to grow faster than sales.
General Mills carries a Zacks Rank #3 (Hold).
Other stocks worth a look in the industry are Flowers Foods, Inc. (FLO - Free Report) , Inventure Foods, Inc. (SNAK - Free Report) and J&J Snack Foods Corp. (JJSF - Free Report) , each holding a Zacks Rank #1 (Strong Buy).