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Performance of General Mills in a Competitive Market

Gabriel Kane

US Equity Market Update as of September 22

(Continued from Prior Part)

General Mills and its peers

Gross profit margins for General Mills (GIS), Kellogg (K), Pinnacle Foods (PF), Mondelez International (MDLZ), and PepsiCo (PEP) are 36.94%, 37.34%, 26.77%, 40.02%, and 55.11%, respectively.

EPS (earnings per share) for General Mills (GIS), Kellogg (K), Pinnacle Foods (PF), Mondelez International (MDLZ), and PepsiCo (PEP) are $0.69, $0.81, $0.38, $0.39, and $1.34, respectively.

The current ratios for General Mills (GIS), Kellogg (K), Pinnacle Foods (PF), Mondelez International (MDLZ), and PepsiCo (PEP) are 0.81, 0.74, 2.05, 0.71, and 1.07, respectively.

Below is an analysis of General Mills’ valuation:

  • The PE (price-to-earnings) ratios for General Mills (GIS), Kellogg (K), Pinnacle Foods (PF), Mondelez International (MDLZ), and PepsiCo (PEP) are 29.00x, 63.24x, 20.37x, 33.06x, and 21.33x, respectively.
  • The PB (price-to-book value) ratios of General Mills (GIS), Kellogg (K), Pinnacle Foods (PF), Mondelez International (MDLZ), and PepsiCo (PEP) are 6.86x, 8.93x, 2.98x, 2.77x, and 8.34x, respectively.

According to these findings, General Mills has outperformed its competitors based on gross profit margin, EPS, and PE.

ETFs that invest in General Mills

The PowerShares Dynamic Food & Beverage ETF (PBJ) invests 5.02% of its holdings in General Mills. PBJ tracks a multifactor, tiered, equal-weighted index of US food industry stocks.

The Guggenheim S&P 500 Equal Weight Consumer Staples ETF (RHS) invests 2.81% of its holdings in General Mills. RHS tracks an equal-weighted index of large-cap US consumer staples stocks drawn from the S&P 500.

The Consumer Staples Select Sector SPDR ETF (XLP) invests 1.88% of its holdings in General Mills. XLP tracks a market-cap weighted index of consumer staples stocks drawn from the S&P 500.

General Mills compared to its ETFs

The year-to-date price movements of General Mills (GIS), PBJ, RHS, and XLP are 9.65%, 6.66%, 4.45%, and -0.11%, respectively.

The PE (price-to-earnings) ratios of General Mills (GIS), PBJ, RHS, and XLP are 29.00x, 24.76x, 24.91x, and 23.54x, respectively.

The PB (price-to-book value) ratios of General Mills (GIS), PBJ, RHS, and XLP are 6.86x, 4.06x, 5.08x, and 5.76x, respectively.

According to these findings, General Mills is way ahead of its ETFs based on price movement, PE, and PB.

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