39.75 -0.08 (-0.20%)
After hours: 5:01PM EDT
|Bid||39.68 x 4000|
|Ask||41.00 x 38500|
|Day's Range||39.73 - 40.52|
|52 Week Range||32.63 - 51.07|
|PE Ratio (TTM)||46.31|
|Earnings Date||Nov 19, 2018 - Nov 23, 2018|
|Forward Dividend & Yield||1.40 (3.50%)|
|1y Target Est||37.00|
Billionaire Dan Loeb doesn’t get in a proxy fight with Campbell Soup (NYSE:CPB) if he doesn’t think there’s money to be made owning activist stocks such as the iconic soup company. “If you decided to invest money in a random sample of activist hedge funds, you would have earned 12.4% before paying the hedge fund 2% per year plus 20% of that 12.4% upside,” wrote Roger Martin, director of the Martin Prosperity Institute, on August 20 in the Harvard Business Review. For example, the fact that Dan Loeb and Third Point LLC feels it’s worth having a proxy fight with Campbell Soup suggests at the very least that there’s some untapped value at the company that current management can’t or won’t extract for shareholders.
Wall Street analysts continue to have a favorable outlook on Conagra Brands (CAG) stock. They expect its recent acquisitions, higher net pricing, improving mix, and cost and productivity savings measures to drive its sales and earnings growth rate. A lower effective tax rate is also likely to cushion its earnings.
Conagra Brands (CAG) is slated to announce its first quarter of fiscal 2019 results on Thursday, September 27. Analysts expect it to sustain its sales and earnings growth momentum, but they expect the growth rate to decelerate, which could be a concern.
On September 19, Hormel Foods (HRL) was trading at a 12-month forward PE (price-to-earnings) ratio of 21.5x. However, the company is trading at a higher valuation multiple in comparison to peers. Tyson Foods (TSN) is trading at a 12-month forward PE ratio of 10.2x. Pilgrim’s Pride (PPC), Campbell Soup (CPB), and Conagra (CAG) are trading at 8.2x, 16.2x, and 16.3x, respectively, as of September 19.
Hormel Foods’ (HRL) current dividend yield is 1.9% based on the closing price of $39.66 as of September 19. In comparison, Tyson Foods’ (TSN) current dividend yield stands at 1.9%, while that of Sanderson Farms (SAFM) is 1.3%. Campbell Soup’s (CPB) current yield is 3.5%, and that of Conagra’s (CAG) is 2.3% based on its September 19 closing price. Dividend yield implies the cash flow received by the investor for each dollar invested in the company’s stock.
The majority of analysts have maintained a “hold” rating for Hormel Foods (HRL). Over the past 15 days, we have seen just one change in target price. On September 17, BMO upped the price target on Hormel Foods to $44.00 from $38.00.
Recently, McCormick’s (MKC) margins have been impressive. The company’s margins have expanded at a healthy rate in the past three quarters despite facing headwinds from higher distribution costs. During the last reported quarter, McCormick’s gross margin expanded by 340 basis points, while the operating margins improved by 330 basis points. Higher volumes, increased pricing, improved mix, and cost-saving measures more than offset the negatives stemming from cost inflation.
McCormick (MKC) is expected to announce its third-quarter results on September 27. Analysts expect the company to sustain its double-digit sales and EPS growth rate in the third quarter. McCormick’s top line will likely benefit from its recent acquisitions. Meanwhile, continued strength in the company’s underlying business, new products, higher net price realization, and expanded distribution should support its sales growth rate.
The J.M. Smucker Company (SJM) reported strong net sales and earnings in its last reported quarter. The company’s acquisition of Ainsworth significantly boosted its net sales growth rate. Meanwhile, its adjusted earnings jumped 17.9% year-over-year driven by a substantial fall in the effective tax rate.
This represents an increase in short interest as investors who seek to profit from falling equity prices added to their short positions on September 7. Over the last month, growth of ETFs holding CPB is favorable, with net inflows of $18.77 billion. This is among the highest net inflows seen over the last one-year and the rate of additional inflows appears to be increasing.
Analysts maintain a consensus “sell” recommendation on the Campbell Soup Company (CPB) stock. Campbell Soup’s management has announced that it’s looking to divest its noncore Fresh and International segments and that it plans to pay down its debt with the proceeds. Campbell Soup reported adjusted EPS of $2.87 in fiscal 2018.
General Mills (GIS) disappointed with its margins performance in its fiscal 2019 first quarter. Its adjusted gross and operating profit margins fell, reflecting continued inflation in input costs and higher supply-chain costs.
The Campbell Soup Company’s (CPB) worries are likely here to stay—at least for the next couple of quarters. The company’s top line is expected to gain from incremental sales from its Snyder’s-Lance acquisition. Meanwhile, Conagra Brands (CAG) announced its acquisition of Pinnacle Foods.
Shares of packaged food manufacturers have eroded a significant amount of investors’ wealth so far this year. Weak organic sales, low margins, and earnings pressures are taking a toll on the financials of these companies and, in turn, their stock prices.
Investing.com - Cannabis stocks were off to the races again midday after a regulatory announcement, while consumer staples were hit by a double whammy of trade tensions and weak earnings.
Bennett Dorrance, a descendent of the company’s founder, is in the cross hairs of activist investor Dan Loeb.
It had filed an earlier proxy seeking to replace only three directors and to push for a sale of the company, which it characterized as the only “justifiable outcome of a strategic review.” At the end of August, Campbell announced its intention to sell its fresh food units, including Bolthouse Farms, and its overseas brands Arnott’s and Kelsen. Birch Partners disclosed on Sept. 9 that it had entered into a voting agreement with (SAIC)(SAIC) to vote its stake of 17,920,892 shares, or 48.5% of Engility’s stock, in support of SAIC’s $1.5 billion merger bid for Engility announced on Sept. 10. Water Island Capital revealed an initial position in the apparel maker of 867,606 shares, or 5.5% of the publicly traded stock, over the time span from July 2 through Aug. 31 at prices ranging from $27.50 to $29.32 apiece.
Third Point, run by billionaire investor Daniel Loeb, launched a proxy fight last week to replace Campbell's 12-member board. Loeb's $18 billion hedge fund, which owns a 5.65 percent stake, said at the time that the soup-maker was in a "mess" and faulted its board for failing to take corrective action.
(Reuters) - Campbell Soup Co and hedge fund Third Point LLC on Friday filed preliminary proxy materials urging the food company's shareholders to vote in favor of two entirely different slates of board nominees. Third Point, run by billionaire investor Daniel Loeb, launched a proxy fight last week to replace Campbell's 12-member board. Loeb's $18 billion hedge fund, which owns a 5.65 percent stake, said at the time that the soup-maker was in a "mess" and faulted its board for failing to take corrective action.
Activist investor Daniel Loeb is testing the cohesion of the family that has controlled Campbell Soup Co. for more than a century with his push to unseat the board and potentially sell the company. Mr. Loeb’s campaign to replace the soup maker’s board, announced last week, needs backing from descendants of John T. Dorrance, the inventor of Campbell’s condensed soup. Additionally, two-thirds of shareholders would need to approve the full sale that Mr. Loeb has called for, according to Campbell’s charter.
Analysts maintained a neutral outlook on General Mills (GIS) stock before its earnings for the fiscal first quarter of 2019. Incremental sales from the Blue Buffalo acquisition, higher net price realization, cost and productivity savings, and lower taxes are expected to drive the company’s financials.
Campbell Soup Company (CPB) has been named to the Dow Jones Sustainability North America Index for the 10th consecutive year. “Campbell is honored to again be included on the Dow Jones Sustainability Indices,” said Dave Stangis, Campbell’s Chief Sustainability Officer.