Campbell Soup Company (CPB) produces a cream of mushroom soup that is a holiday season staple, but Campbell Soup had disappointing sales in fiscal year 2014. Campbell Soup released its first quarter earnings last week. Are Campbell Soup sales heating up in fiscal 2015?
Campbell Soup – Company Profile
Founded in 1869 as a canning company, Campbell Soup Company has since expanded into a multinational soup and snacks giant that spans 120 countries. In addition to its famous line of soups in red-and-white cans, Campbell Soup is also responsible for the Pepperidge Farm, Inc. baked snacks brand as well as V8 fruit and vegetable juices.
In recent years, Campbell Soup has been on a buying spree. In the summer of 2012, Campbell Soup acquired Wm. Bolthouse Farms, Inc. for $1.5 billion, adding juices, salad dressings and fresh vegetables to its product portfolio. Then, during summer 2013, Campbell Soup purchased Plum Organics, a premium organic baby food maker and Kelsen Group, a Danish snack food company. CPB stock also pays a 2.8% dividend.
Campbell Soup – Earnings Buzz
On Tuesday, Campbell Soup reported a net income of $234 million or 74 cents per share, beating consensus estimates of 72 cents per share. First sales rose 4% to $2.26 billion from $2.17 billion last year, topping analysts’ estimates of $2.22 billion.
Looking ahead to fiscal year 2015, Campbell Soup adjusted its previous guidance and estimates adjusted earnings to be between $2.42 and $2.50 per on projected sales growth of 2%. Analysts’ estimate full-year earnings to be $2.47 per share on annual revenue decline of 0.2%.
Campbell Soup – Current Ratings
In the past 12 months, CPB has fluctuated between a “sell” and a “hold” rating, but just recently, CPB was upgraded to a “buy” rating. CPB currently earns a “B” for its Quantitative Grade, indicating a solid risk-to-return ratio. On the fundamentals side, CPB is struggling to earnings surprises (D), analyst earnings revisions (D), operating margin (C), sales growth (C), and cash flow (C).
However, Campbell Soup does pull off decent marks for earnings momentum (B), earnings growth (B) and return on equity (A). So, Campbell Soup earns a “B” for its overall Fundamental Grade. I consider CPB a “B-rated buy.”
Louis Navellier is a renowned growth investor. He is the editor of five investing newsletters: Blue Chip Growth, Emerging Growth, Ultimate Growth, Family Trust and Platinum Growth. His most popular service, Blue Chip Growth, has a track record of beating the market 3:1 over the last 14 years. He uses a combination of quantitative and fundamental analysis to identify market-beating stocks. Mr. Navellier has made his proven formula accessible to investors via his free, online stock rating tool, PortfolioGrader.com. Louis Navellier may hold some of the aforementioned securities in one or more of his newsletters.
