Camden County, New Jersey-based soup and snack maker Campbell Soup reported lower-than-expected revenue in the fiscal second quarter as COVID-19 restrictions eased and consumers went out to eat more, which affected processed food sales.
The Camden, New Jersey-based company reported quarterly adjusted earnings of 0.69 cents per share, below Wall Street consensus estimates of $0.78 per share. Additionally, the company said its revenue fell more than 3% to $2.2 billion from a year earlier. It also missed analysts’ expectations of $2.24 billion.
“Volumes are under more pressure than expected, but promotions have increased in snacks, driving up prices. FY’22 guidance reiterated. H2 implied EPS of $1.17-1.27 vs. $1.15 of consensus, with delta driven by margin improvement; consensus close to mid-term sell-off guidance. The stock is likely flat today given the recent pullback,” noted Rob Dickerson, equity analyst at Jefferies.
The soup and snack maker expects full-year adjusted earnings of between $2.75 and $2.85 per share.
At the time of writing, Campbell Soup stock was trading up 1.6% at $42.98 on Wednesday. However, the stock has fallen 0.20% so far this year after falling more than 10% in 2021.
“High exposure to age-defying soup category: shelf stable soup (26.5% of sales) faces headwinds given shifting preferences towards better-for-you and fresh foods, private label competition and pricing pressure,” noted Pamela Kaufman, equity analyst at Morgan Stanley.
“Snack brands are well positioned, but face competitive pressures: Milano, Goldfish, Farmhouse and Snyder’s-Lance have strong brand equity, but face strong competition from PEP and MDLZ. Significant organizational changes over the past two years have refocused the business and are promising: the divestment of non-core businesses and new management refresh the company’s strategic plan, allowing the company to focus on its segments and key geographies. »
Campbell Soup Stock Price Forecast
Seven analysts who offered stock quotes for Campbell Soup over the past three months forecast a 12-month average price of $46.00 with a high forecast of $50.00 and a low forecast of $43.00 .
The average price target represents a change of 8.75% from the last price of $42.30. Of these seven analysts, one rated ‘Buy’, six rated ‘Hold’, while none rated ‘Sell’, according to Tipranks.
Morgan Stanley gave the base price target at $45 with a high of $61 in a bullish scenario and $22 in a worst-case scenario. The investment bank gave shares of the packaged food company an “equal weight” rating.
Several analysts also updated their stock outlook. Deutsche Bank raised the target price from $45 to $46. JPMorgan reduced the target price from $45 to $44. Piper Sandler raised the price target from $43 to $45. Credit Suisse raised the target price from $41 to $43.
However, technical analysis suggests that it is good to sell, as the 100-day moving average and the 100-200-day MACD oscillator show a selling opportunity.
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