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General Mills (GIS) Gains As Market Dips: What You Should Know

Zacks Equity Research

General Mills (GIS) closed the most recent trading day at $52.77, moving +0.7% from the previous trading session. This change outpaced the S&P 500's 0.68% loss on the day. At the same time, the Dow lost 0.33%, and the tech-heavy Nasdaq lost 1.46%.

Coming into today, shares of the maker of Cheerios cereal, Yoplait yogurt and other packaged foods had gained 1.31% in the past month. In that same time, the Consumer Staples sector gained 1.56%, while the S&P 500 lost 1.19%.

Wall Street will be looking for positivity from GIS as it approaches its next earnings report date. On that day, GIS is projected to report earnings of $0.76 per share, which would represent a year-over-year decline of 3.8%. Meanwhile, our latest consensus estimate is calling for revenue of $4.22 billion, up 8.57% from the prior-year quarter.

GIS's full-year Zacks Consensus Estimates are calling for earnings of $3.14 per share and revenue of $16.93 billion. These results would represent year-over-year changes of +0.96% and +7.53%, respectively.

Any recent changes to analyst estimates for GIS should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.04% higher. GIS is holding a Zacks Rank of #2 (Buy) right now.

Looking at its valuation, GIS is holding a Forward P/E ratio of 16.68. This represents a discount compared to its industry's average Forward P/E of 19.84.

We can also see that GIS currently has a PEG ratio of 2.38. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Food - Miscellaneous was holding an average PEG ratio of 2.39 at yesterday's closing price.

The Food - Miscellaneous industry is part of the Consumer Staples sector. This industry currently has a Zacks Industry Rank of 151, which puts 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.

To follow GIS in the coming trading sessions, be sure to utilize Zacks.com.


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