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General Mills (GIS) Gains But Lags Market: What You Should Know

Zacks Equity Research

General Mills (GIS) closed the most recent trading day at $55.20, moving +0.33% from the previous trading session. This move lagged the S&P 500's daily gain of 1.21%. Meanwhile, the Dow gained 0.97%, and the Nasdaq, a tech-heavy index, added 1.35%.

Coming into today, shares of the maker of Cheerios cereal, Yoplait yogurt and other packaged foods had gained 3.27% in the past month. In that same time, the Consumer Staples sector lost 0.66%, while the S&P 500 lost 3.6%.

Investors will be hoping for strength from GIS as it approaches its next earnings release. On that day, GIS is projected to report earnings of $0.77 per share, which would represent year-over-year growth of 8.45%. Our most recent consensus estimate is calling for quarterly revenue of $4.10 billion, up 0.08% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $3.37 per share and revenue of $17.44 billion, which would represent changes of +4.66% and +3.42%, respectively, from the prior year.

Any recent changes to analyst estimates for GIS should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. GIS is currently sporting a Zacks Rank of #2 (Buy).

Digging into valuation, GIS currently has a Forward P/E ratio of 16.33. For comparison, its industry has an average Forward P/E of 18.12, which means GIS is trading at a discount to the group.

Investors should also note that GIS has a PEG ratio of 2.33 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. GIS's industry had an average PEG ratio of 2.53 as of yesterday's close.

The Food - Miscellaneous industry is part of the Consumer Staples sector. This group has a Zacks Industry Rank of 151, putting it in the bottom 42% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

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