General Mills INC. (NASDAQ: GIS) has confirmed the release date for its quarterly earnings results, which will be on Wednesday, March 23, 2022, before the opening bell.
What to look for: The company is implementing its Accelerate strategy to create long-term, consistent, profitable growth and the highest shareholder returns. To get a competitive edge and win, the approach focuses on four pillars: aggressively developing brands, continuously innovating, unlocking scale, and becoming a big force. For the upcoming quarterly release, the company is expected to post growth in earnings.
Earnings: Stockearning’s Estimated EPS is pegged at $0.78 per share, representing a YoY increase of 4.88%. In the last quarter, the company released earnings of $0.99 per share, missing consensus estimates of $1.05 per share by $0.06. Historical EPS Performance for the past 12 quarters shows that the company has topped estimates 23 times (63%), missed four times (11%), and missed nine times (25%). For the full year, the company has set guidance of earnings of $3.71-$33.83 per Share.
Revenue: The company is expected to report revenue of $4.53 billion, an increase of 0.14% from the same period a year ago. In the second quarter, the company has sales of $5 billion, representing a YoY increase of 6%. In addition, the company anticipates organic net sales to grow 4-5% for the full year because of robust performance in the past quarters.
Stock movement: GIS shares have lost 10.9% since the company released its last earnings release. Interestingly, following the earnings release, the company's shares have in the past been UP in 30 quarters out of 47 quarters. So, the historical price reaction suggests a 53% probability of the share price going UP following the earnings release. According to the Stockearning algorithm, the predicted volatility on the first day is +/-3%, while the predicted volatility on the seventh day is +/-3%.
What analysts are saying: Deutsche Bank analyst Steve Powers lowered his price target on the stock from $74 to $71 and maintained a Buy rating on the shares. Powers told investors that the company is still dealing with broad-based inflation spanning materials, packaging, personnel, and shipping, which the Russia/Ukraine crisis has worsened. As a result, the analyst anticipates that investor concerns over price elasticity will grow in the near term.
According to Stifel analyst Christopher Growe, the company kicked off the yearly CAGNY summit by alerting that it now anticipates a high-single-digit to low-double-digit decrease in profit Q3 due to considerable shortages in key US product categories, but it maintained its full-year guidance and shifted more earnings to the fourth quarter than initially anticipated. The analyst, who cut his Q3 EPS forecast to 76c from 84c on the General Mill's update and upped his Q4 forecast by 5c, predicted that the stock would fall on the new. Growe has a Hold rating on the shares with a price target of 64 price target.
Morgan Stanley analyst Pamela Kaufman lowered her price target on the stock to $51 from $56 and maintained a Sell rating on the shares. According to Kaufman, the Packaged Food category lagged the industry over the past year but has witnessed a better performance in the past month because of sector rotation and an increase in COVID-19 cases, which supports short-term demand. However, she anticipates food multiples capping by a much more tough underlying view, and she favors firms linked to a post-COVID topline rebound, profit from cyclical growth tailwinds, and with enhanced pricing power.
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