Shelf-stable Foods Stock Q1 Highlights: General Mills (NYSE:GIS)
The end of earnings season is a good time to take a step back and see who shone (and who didn't shine so much). Let's take a look at how shelf-stable food stocks performed in the first quarter, starting with General Mills (NYSE:GIS).
As America industrialized and moved away from an agricultural economy, people became increasingly demanding on their time. Packaged foods, such as canned goods and snacks, emerged as a solution to provide convenience to the evolving American household. Today, Americans are looking for high-quality, reliable, and affordable brands. In addition, there is an increasing emphasis on health-conscious and sustainable food options. Packaged food stocks are considered resilient investments. People will always need to eat, so these companies will enjoy steady demand as long as they keep up with changing consumer preferences. The industry ranges from multinational corporations to small specialty businesses and is subject to food safety and labeling regulations.
The 21 shelf-stable food stocks we track had decent first quarter performance, with sales beating analyst consensus estimates by 0.5% on average. Meanwhile, next quarter sales guidance was 1.6% below consensus estimates. While many growth stocks' valuation multiples have yet to return to their early 2021 highs, subsiding inflation led to market optimism at the end of 2023. The start of 2024 was different as mixed signals led to market volatility, with some shelf-stable food stocks faring a little better than others, but overall they fell, with stock prices down an average of 3.4% since their last earnings release.
General Mills (NYSE:GIS)
Best known for its portfolio of strong breakfast cereal brands, General Mills (NYSE:GIS) is a packaged foods company that also makes a name for itself in cereal, baking products, and snacks.
General Mills reported sales of $5.1 billion, down 0.5% year over year but beating analyst expectations by 2.7%. It was a strong quarter for the company, beating analysts' organic sales growth expectations by a large margin and beating profit forecasts by a large margin as well.
“General Mills' strategic focus on brand building, innovation and in-store execution contributed to improving volume and market share trends in the third quarter,” said Jeff Harmening, General Mills chairman and CEO.
General Mills Total Revenue
The stock has fallen 3.1% since the earnings release and is currently trading at $66.55.
Is now the time to buy General Mills? You can get a free full analysis of earnings results here.
Best of Q1: Hershey (NYSE:HSY)
Best known for its milk chocolate bars and Hershey's Kisses, Hershey (NYSE:HSY) is an iconic company known for its chocolate products.
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Hershey reported that sales rose 8.9% year over year to $3.25 billion, beating analyst expectations by 4.5%. It was a strong quarter for the company, which also beat analysts' gross margin expectations by a large margin.
Hershey Total Revenue
The stock has fallen 7.2% since the earnings release and is currently trading at $181.9.
Is now the time to buy Hershey's? You can get a free full analysis of earnings results here.
First quarter's weakest stock: Lamb Weston (NYSE:LW)
Best known for its “Grown in Idaho” brand, Lamb Weston (NYSE: LW) produces and sells frozen French fries, mashed potatoes, and other potato products.
Lamb Weston reported sales of $1.46 billion, up 16.3% from a year ago and 11.8% below analyst expectations. It was a weak quarter for the company, with full-year sales guidance coming in below analyst expectations and operating margins also below analyst expectations.
Lamb Weston had the worst performance relative to analyst expectations and the weakest full-year guidance update of the group. The company's shares have fallen 19.1% since the earnings report and are currently trading at $81.75.
Read the full analysis of Lamb Weston's results here.
Sunopta (NASDAQ:STKL)
Committed to clean-label foods, SunOpta (NASDAQGS:STKL) is a sustainability-focused food and beverage company that specializes in sourcing, processing, and packaging natural and organic products.
SunOpta reported that sales increased 18% year over year to $182.8 million, beating analyst expectations by 8.3%. It was a strong quarter for the company, with full-year sales guidance exceeding analyst expectations and gross margins also well ahead of analyst expectations.
SunOpta beat analyst expectations the most and also raised its full-year guidance by the most among its peers. The company's shares have fallen 0.5% since the earnings report and are currently trading at $5.61.
Read our full actionable report on SunOpta for free here.
McCormick (NYSE:MKC)
McCormick (NYSE:MKC) , a competitor to the classic red Heinz ketchup bottle, sells food flavoring products such as condiments, spices and seasoning mixes.
McCormick reported that sales increased 2.4% year over year to $1.6 billion, beating analyst expectations by 3.3%. The company significantly beat analysts' organic sales growth expectations and also beat earnings estimates by a large margin, making it a very strong quarter for the company.
The stock has fallen 1.9% since the earnings release and is currently trading at $68.56.
Read our full, actionable report on McCormick for free here.
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